Stock Of The Week : AirAsia

BUDGET airline AirAsia Bhd sustained its upward thrust amid continuous buying momentum, pushing to a high of RM3.13 during intra-day session before trimming advances slightly to close at RM3.06, up six sen, bucking the generally frail primary market yesterday.

Based on the daily bar chart, the stock had penetrated the historical peak of RM3.04 to establish a new all-time high on bigger trading volumes and according to the books, such a convincing major breakout would most likely clear the way for more uptrend going forward. Perhaps traders can consider taking a position, if one is optimistic.

Turning to the indicators, the daily slow-stochastic momentum index appeared pretty firm, with the oscillator percent K and the oscillator percent D flirting at the bullish extended-mode territory.

Likewise, the 14-day relative strength index maintained the posture above the 70-point line to stay positive.
In addition, the daily moving average convergence/divergence histogram continued to expand upward against the daily signal line to retain the bullish note. It issued a buy on April 21.

The technical landscape is looking good. Combined with encouraging price action, they suggest AirAsia shares may climb on follow-through interest, targeting the RM3.50 - RM3.60 band in the near term.

Support is pegged at the RM2.90 level, of which a clear violation would signal weakness in the prevailing trend. - By K M Lee of biz.thestar.com.my

The comments above do not represent a recommendation to buy or sell.