DAILY TRADING STOCKS: KPS Consortium, AT Systemisation

KPS’ daily chart

KPS’ share price may trade higher if it can break above the resistance level. The stock’s uptrend that  started since Sept 2011 was reaffirmed last week when it printed a 52-week high just below the  RM0.40 level. Selling ensued but  this  was proven  to be shortlived as the stock  was again testing the resistance level.  The higher close yesterday was accompanied by a gap up, highlighting the strong upward sentiment. Higher prices are thus expected but a prudent trade may  involve  waiting until a close above the psychological RM0.40 before initiating a position, as this would erase the negative bias of the 29 March “Bearish Engulfing” candle. This confirms the high volume yesterday was indeed buying action. A close below yesterday’s gap low of RM0.38 can be employed as a stop loss. A measured move based on the year-long sideways move could see the price reaching RM0.60, provided that  the  2011-high of RM0.45 and the psychological RM0.50 are violated. The upward bias will be nullified if the stock fails to break RM0.40, with a close below RM0.35,  the  low of last week, as  the  confirmation. Strong support is expected at RM0.30, the low of March.

AT’s daily chart

AT’s share price may trade lower if it fails to break the resistance level. We looked at this stock  in late February as there was a likelihood of it moving higher. The stock has moved favourably and even breached the second target of RM0.27, but it  subsequently met with a clear resistance at RM0.30, with the “Shooting Star”-like candle of 23 March and “Bearish Engulfing” candle of 26 March highlighting the selling pressure.  A similar  pattern appeared yesterday when it formed a  “Doji” with  an  “Upper Shadow”.  The lower volume also suggests weak buying support. This increases the likelihood of a  failed test, and an aggressive trade may  involve liquidating below RM0.30. A more conservative trade may  involve waiting until a close below yesterday’s low of RM0.28 before exiting. Weakness has to be confirmed by a violation of last week’s low of RM0.25, with  the  price targets at RM0.19 and RM0.16,  the Fibonacci levels of the Jan-Mar rally. However, the negative bias will be nullified should  the stock close above RM0.30, after which look for it to continue to climb. Resistance should come in at RM0.40, a measured move based on the Feb-March rally.  

Source: OSK188