PERDANA Petroleum Bhd, (formerly known as Petra Perdana Bhd) rebounded moderately from a nine-year low of 48 sen on May 23 to a high of 67.5 sen on June 18, coincidentally, also the 200-day simple moving average (SMA) on renewed bargain hunting before retreating slightly to trade range-bound on consolidation due mainly to overbuying. The stock finished up two sen to 63.5 sen yesterday.
Based on the daily bar chart, Perdana Petroleum appears to be making an effort to recover after a long bearish phase and chances are great that prices could develop further to the upside, as investors are seen trotting back to this counter on growing trading volume.
Perhaps, investors can consider accumulating while the shares are consolidating, if one is optimistic of a breakthrough going forward, which may see the fate of this stock turning brighter, enroute to the 78.5 sen or the 86 sen-90 sen heavy resistance band.
Apparently, the oscillator per cent K and the oscillator per cent D of the daily slow-stochastic momentum index are on the slide, ending at about 60% and 37% respectively. It had issued a sell at the top on Tuesday.
Meanwhile, the 14-day relative strength index retraced from a reading of 85 on Monday to a low of 62 points before ticking up slightly to settle at the 65 points level. Elsewhere, the daily moving average convergence/divergence histogram retained the posture sharply above the daily signal line to retain the bullish note.
Technically, prices are likely to extend the sideways consolidation process, but with a mild upward bias, seen as giving investors an opportunity to nibble until a positive breakout is detected.Support floor is pegged at the 14-day SMA, now resting at 57.5 sen and still rising. - By K.M. Lee
● The comments above do not represent a recommendation to buy or sell.
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