Media Prima is exhibiting signs of indecision at the 200-day MAV line last
Friday. Meanwhile, bulls and bears are still fighting for domination at this
critical moving average line, which now lies at the RM2.63 level. In view of
the significance of this line since October last year, we would like to highlight that a clean breakdown of
this line would likely trigger panic selling which would drag its share
price to the next strong support level of RM2.41.
Media Prima was consolidating the Sept-Oct 2011 rebound at
below the 200-day MAV line from Nov 2011 to Jan 2012. The stock then broke
above the moving average line in Feb 2012, which signalled the end of the
consolidation phase. Nevertheless, the breakout only led to a sideways trend at
above the moving average line and it is at great risk of returning back below
the line.
Its volume increased drastically while the stock was trading
at the 200-day MAV line last Friday. Meanwhile, bulls and bears are still
fighting for domination at this crucial level.
The importance of this line is highlighted by the circles in the above daily
chart. From the chart, we could observe that the stock experienced four obvious
failed breakout attempts at the 200-day MAV line. The high volume on last
Friday, during which the stock was testing the moving average line, also
confirms that many traders are indeed watching the line closely.
Last Friday, the stock closed right at the 200-day MAV line,
which is situated at the RM2.63 level. We
would like to emphasize that if this line is violated decisively, strong selling
pressure is expected to emerge which will likely drag the stock towards the
next strong support of RM2.41. And should the RM2.41 level be violated too,
look for another strong support at the RM2.31 level. To the upside, look for an
immediate resistance at the RM2.78 level, followed by RM2.97.
Source: OSK188
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