RENEWED bargain hunting nibbling pushed Silk Holdings Bhd shares to a high of 42.5 sen during intra-day session.The recovery came about following a lengthy correction process. It started out from the 32 sen level on Dec 17, last year in volatile fashion but the trend only became more evident and promising in the past couple of days.
Based on the daily chart, it appears prices are mounting a fresh attempt to challenge the 49.5 sen-54.5 sen upper heavy resistance band. If the latest significant increase in the trading volumes is a reliable sign of growing interests and optimism among investors in this counter, there is a high possibility that a major bullish breakout would happen over the next several days.
Apparently, the oscillator per cent K and the oscillator per cent D of the daily slow-stochastic momentum index were on the rise. It had triggered a short-term buy at the neutral area on Thursday.
Mirroring the uptrend, the 14-day relative strength index improved moderately from a reading of 47 to settle at the 71 points level yesterday.
Meanwhile, the daily moving average convergence/divergence histogram expanded sharply against the daily signal line to stay bullish. A buy signal was triggered on March 11.
Technically, indicators are pretty encouraging, implying the share price of Silk Holdings are likely to firm in the short term.
If an earlier mentioned major breakthrough come to light, the next endeavour would be to test the greater resistance, resting at the 70 sen-80 sen range.
Current support is anticipated at the 35.5-sen level. An additional support is pegged at the recent lows of 32-sen floor.
By K.M. Lee, thestar.com.my
● The comments above do not represent a recommendation to buy or sell.
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