OSK – 5053: Remains in downtrend.
Chart 1: OSK – 5053 (12/02/2010 ~ 09/06/2010 )
As shown on chart 1, price of OSK remains in the T1 downtrend, which lasted for 2 months. During the downtrend, price technically rebounded a few times, but remained resisted by the T1 downtrend line. Whenever price tested the T1 line, it formed another lower-high, re-affirming the downtrend formation.
Meanwhile, other than the T1 downtrend line, the 14, 21, 31 EMA is still serving as the dynamic resistance for OSK, and technically, provided that price is still resisted by the dynamic resistance, the technical outlook shall remains weak.
In short, price of OSK has to break above the T1 line as well as the 14, 21, 13 EMA in order to break free from the downtrend. This is because whenever price is still moving below the 14, 21, 31 EMA, it means all investors who bought during this downtrend are mostly making losses, thus their will to break even is stronger than to make money. In other words, a downtrend is a fear dominant market, in which selling pressures are high. Nevertheless, OSK immediate support is at RM1.25 level while the next support is at RM1.14 WinChart Automatic Fibonacci Retracement.
| 4 Q Rolling PER | 6.05 | Dividend Yield | 6% |
| Dividend | Dividend Yield | Net Profit Ratio | |
| 31/12/2009 | 7.5 sen | 6.1% | 13.73% |
| 31/12/2008 | 7.5 sen | 7.58% | 16.59% |
| 31/12/2007 | 20 sen | 8.62% | 21.38% |
| 31/12/2006 | 12.5 sen | 6.38% | 23.84% |
| 31/12/2005 | 7.5 sen | 7.85% | 13.52% |
Table 1: OSK – 5053, yearly dividend, dividend yield, and net profit ratio.
LBS – 5789: Breaking away from downtrend.
Chart 2: LBS – 5789 (20/01/2010~09/06/2010)
As shown on chart 2, price of LBS formed a T1 downtrend which lasted for 5 months, and during the downtrend, many technical rebounded took place, and tested the T1 line, but failed. Therefore, it formed several lower-highs repeatedly, re-affirming the downtrend.
As indicated by A, price breaks above the T1 line for the first time in 5 months, as well as breaking above the 14, 21, 31 EMA dynamic resistance. This is a positive signal, but it is yet to be confirmed of a reversal, as price retreated at RM0.57 level due to profit taking activities.
If price could stay above the 14, 21, 31 EMA, and formed a higher low, it would have the reversal condition, and the next condition would be a strong volume when price starts rally. If price could then break above the RM0.57 resistance, it would be a reversal signal, then the 14, 21, 31 EMA would be serving as trailing stop reference for this possible uptrend.
However, if price should remains sideways while volume is still low, it would extend its consolidation. Immediate support for LBS is at the 14, 21, 31 EMA, while the next support is at RM0.45 WinChart Automatic Fibonacci Retracement.
| 4 Q Rolling PER | 0 times | Dividend Yield | 0% |
| Dividend | Dividend Yield | Net Profit Ratio | |
| 31/12/2009 | 0sen | 0% | -8.28% |
| 31/12/2008 | 0 sen | 0% | 5.79% |
| 31/12/2007 | 0 sen | 0% | 2.14% |
| 31/12/2006 | 0 sen | 0% | 1.41% |
| 31/12/2005 | 3.3sen | 8.05% | 8.11% |
Table 2: LBS – 5789, yearly dividend, dividend yield, and net profit ratio.
Revision of last week's Case Study: BJCorp – 3395: Downtrend, breaking new low.
Chart 3: BJCorp – 3395 (11/02/2010~09/06/2010)
As indicated by A, price of Bjcorp was supported by the RM1.45 level, and consolidated there for about two weeks, but finally, price broke below the RM1.45 support level, making a 3 months low. Technically, when price should be this support level, it means that the T1 downtrend remains, and the technical outlook remains weak. Meanwhile, the 14, 21, 31 EMA continued serving as a dynamic resistance for Bjcorp.
Since price breaks below the RM1.45, it means that all investors who had bought their share above the RM1.45, and are still holding, are all making losses. Therefore, it is assume that the will to break even is stronger than the will to make money as these investors are having losses instead on profit which they had anticipated when they bought their shares. Therefore, there will be ready sellers near the RM1.45 level, and the selling pressure is likely to be strong. Nonetheless, immediate support is at RM1.32 WinChart Automatic Fibonacci Retracement while the next support is at RM1.15 WinChart Automatic Fibonacci Retracement.
| 4 Q Rolling PER | 0 times | Dividend Yield | 2.45% |
| Dividend | Dividend Yield | Net Profit Ratio | |
| 30/04/2009 | 3.35 sen | 3.99% | -0.83% |
| 30/04/2008 | 9 sen | 8.11% | 17.20% |
| 30/04/2007 | 0 sen | 0% | 5.75% |
| 30/04/2006 | 0 sen | 0% | -24.33% |
| 30/04/2005 | 0 sen | 0% | -3.03% |
Table 3: BJCorp – 3395, yearly dividend, dividend yield, and net profit ratio.
Conclusion:
Generally, it takes time for a stock to reverse its trend. First, a technical rebound, with strong volume, breaking above the downtrend line of the dynamic resistance, then a formation of a higher-low. Then only the required conditions are met. Therefore, if market should rebound with strong volume, there is a better chance for many stocks to reverse.
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