As the KCLI retreated after being resisted by the 1532 level, many blue-chip counters were affected, some even breaks below their dynamic support. Nevertheless, despite the technical correction, the KLCI has not shown any signal of a downtrend formation. Below are this week's case studies.
Revision of last week's case study: Gamuda – 5398: Weak technical outlook.
Chart 1: Gamuda – 5398 as at 16/11/2010.
As shown on chart 1, price of Gamuda fell below RM 3.80, and had a sharp decline, but it found its temporary support at RM3.45 level and technical rebounded then. As indicated by A, if price of Gamuda should remain resisted by the 14, 21, 31 EMA, it would form another lower-high.
Technically, as long as price is still resisted by the 14, 21, 31 EMA, the technical outlook shall remain weak. Generally, it is a dangerous move to try to catch the falling price.
In short, if price should resume its uptrend, it must first break above the 14, 21, 31 EMA, and later forming a higher-Low, together with the increased of volume, then it is only an ideal buy signal. In the contrary, if price should break below RM3.45 support, it would be making a new low, and the next support will be at RM3.30.
| 4 Q Rolling PER | 25.52 times | Dividend Yield | 3.38% |
| Dividend | Dividend Yield | Net Profit Ratio | |
| 31/07/2010 | 12 sen | 3.16% | 11.43% |
| 31/07/2009 | 8 sen | 2.38% | 7.10% |
| 31/07/2008 | 25 sen | 9.26% | 13.52% |
| 31/07/2007 | 46 sen | 5.90% | 12.23% |
| 31/07/2006 | 16 sen | 4.57% | 13.74% |
Table 1: Gamuda – 5398, yearly dividend, dividend yield, and net profit ratio.
TA – 4898: Technical Correction, testing dynamic support.
Chart 2: TA – 4898 as at 16/11/2010.
As shown on chart 2, after forming a higher-Low on the 20th of October, price of TA formed an uptrend, and at the same time, supported by the 14, 21, 31 EMA, and therefore, the 14, 21, 31 EMA is still serving as the dynamic support as well as the trailing stop reference.
As indicated by A, after the rally, price of TA pulled back as investors take profit, but price of TA is supported by the the 14-day EMA. If price should rebound from the 14, 21, 31 EMA, then it would form another higher-Low, thus a signal suggesting a continuation of the uptrend. Therefore, those who follow the 14, 21, 31 EMA could continue to hold, and ride with the uptrend with the lowest risk.
As for new buyers, an ideal buy signal would be a formation of a higher-Low, and the first cut-loss point would be at RM0.71 level. If price should break below RM0.71, it means that the uptrend has failed to form. Therefore, the RM0.71 is the bottom line of new buyers. If price should continue its uptrend after one should entered, then one should apply the 14, 21, 31 EMA as the trailing stop reference.
Nevertheless, we should always refer to the major market trend, and if the broad market could resumes its uptrend, then there is a better chance for the stocks which stays in uptrend to continue their uptrend. In contrary, should the broad market to continue its technical correction, then many the uptrend of many individual stocks would be affected.
| 4 Q Rolling PER | 20.95 times | Dividend Yield | 0.00% |
| Dividend | Dividend Yield | Net Profit Ratio | |
| 31/01/2010 | 0 sen | 0.00% | 20.89% |
| 31/01/2009 | 4.5 sen | 7.32% | 9.65% |
| 31/01/2008 | 10 sen | 7.94% | 7.77% |
| 31/01/2007 | 7 sen | 7.95% | 8.92% |
| 31/01/2006 | 3 sen | 6.34% | 10.42% |
Table 2: TA – 4898, yearly dividend, dividend yield, and net profit ratio.
AMMB – 1015: Testing important dynamic support.
Chart 3: AMMB – 1015 as at 16/11/2010.
As shown on chart 3, after hitting its peak at RM6.40 on the 1st of November, price of AMMB retreated as profit taking took place, and the correction of regional markets also affected the performance of AMMB.
As indicated by A, price of AMMB is now testing the 14, 21, 31 EMA dynamic support, and this is an important support. Ever since price of AMMB returning to above the 14, 21, 31 EMA in June, it has been supported by the 14, 21, 31 EMA, and therefore, it stayed in an uptrend.
If price should break below the 14, 21, 31 EMA, it would mark an end to the uptrend. However, even if price should break below the 14, 21, 31 EMA, it does not mean that price of AMMB would form a downtrend right away, unless it forms a lower-high.
Nevertheless, as for those who are already holding AMMB, it is a good idea to continue to hold as long as the 14, 21, 31 EMA is still supporting the uptrend. Also, it is a good idea to also allow some room for this correction, just to avoid over reacting and selling too early. Therefore, investors could set a bottom line of RM 6.00 as the cut-loss point.
| 4 Q Rolling PER | 15.22 times | Dividend Yield | 1.71% |
| Dividend | Dividend Yield | Net Profit Ratio | |
| 31/03/2010 | 10.5 sen | 2.10% | 14.77% |
| 31/03/2009 | 8 sen | 3.07% | 14.69% |
| 31/03/2008 | 6 sen | 1.74% | 11.13% |
| 31/03/2007 | 5 sen | 1.33% | -3.38% |
| 31/03/2006 | 5 sen | 1.77% | 7.34% |
Table 3: AMMB – 1015, yearly dividend, dividend yield, and net profit ratio.
Conclusion:
Despite technical correction in the broader market, the uptrend remains intact, and generally, there is no need to take profit too early. As long as the trailing stops and trading plan is in place, one should follow his or her own plan.
Copyright © 2009 Straits Index (M) Sdn BhdImportant Disclaimer:These content provided by Straits Index (M) Sdn Bhd is solely for education and information purposes only, and do not suggest any investment advices. All information displayed are believed to be accurate and reliable. Interpretation of the data or analysis is at the reader's own risk. Straits Index (M) Sdn Bhd reserves the rights but obligations to update, admen, or even terminate the materials. 重要声明:以上的内容由海峡指数(马)私人有限公司提供,纯粹是教育性质, 并不是任何的投资忠告。所有资料显示认为是准确和可靠的。对数据或分析的解释和用途是在于用户自己的风险。海峡指数(马)有限公司持有保留及义务更新,甚 至终止材料的权利。
