Friday 17 August 2012

Highlights / Stock Pick of the Day - Alam Maritim Resources Berhad


Alam Maritim's share price soared 6.5 sen on Tuesday following its impressive 2Q quarter results that saw its net profit more than double year-on-year. From a technical perspective, Alam Maritim has confirmed a "Double Bottom" reversal pattern, breaking above the trigger line with 23m shares changing hands. The price action subsequently formed a bullish engulfing pattern over the next two days, signaling a continuation of the upward momentum. The former trigger line (RM0.55) has now turned support and we reckon any weaknesses in the share price would be bought up just north of that level. Our measurement objective for the immediate term is RM0.62.

On the weekly chart, the MACD Signal line has just managed a bullish crossover while the histogram has now turned positive. The Stochastics indicator and the RSI have also hooked  upwards from oversold levels, indicating the bullish momentum is likely to continue. That said, strong resistance will likely present itself in the region of RM0.65- RM0.70 where the long term resistance line  is situated. Any gains would likely be capped at those levels.   

Source: Kenanga

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