Stock Of The Week: DUFU

DUFU Technology Corp Bhd fell to an all-time low of 27 sen on August 9 on extended liquidation pressure during the previous bearish cycle. Thereafter, the shares fluctuated between a narrow range on consolidation and it lasted for three months before changing for the better in the wake of fresh bargain hunting, driving the stock to a high of 41 sen during intra-day session yesterday.

Based on the daily bar chart, prices had penetrated the bearish descending line and they now are holding up by all the moving averages on our radar screen, implying the worst is over. With trading volumes on the rise, indicating investors are making a comeback to this counter, there may be more upside potential going forward.

Elsewhere, the oscillator per cent K and the oscillator per cent D of the daily slow-stochastic momentum index continued to climb after triggering a short-term buy at the neutral area in mid-week. Likewise, the 14-day relative strength index sustained the upward thrust from the mid-range to end at the 73 points yesterday.
Meanwhile, the daily moving average convergence/divergence histogram expand sharply and positively against the daily trigger line to retain the bullish momentum.

Technical indicators are looking good. Combined with the encouraging price action, they suggest Dufu Technology Corp shares are poised to advance in the immediate term. A push above an initial resistance of 42.5 sen is likely to drive prices higher to challenge the next upper hurdle of 50 sen - 50.5 sen band. Greater resistance is resting at 65 sen, followed by the 73 sen mark.

Current support is envisaged at 37.5 sen. An additional floor is pegged at the 14-day simple moving average of 35 sen. - By K.M. Lee