Traditionally, a defensive counter, Axiata's share price has
been steadily inching higher since the start of the year. In the past two months
though, the stock has formed a short term top in the absence of any positive
newsflows. On Monday, Axiata rose 21 sen to close at RM6.20. The volatility
breakout of the upper bollinger band confirmed what resembles an ascending
triangle pattern, accompanied by the MACD histogram crossing again into the positive territory. Along with the
MACD-Signal line crossover, the
indicator suggests an increase in upward momentum as well as a
continuation of the uptrend. With the breakout, the measurement objective is
now at the region of RM 6.60/70 with a stop-loss level placed just below the
resistance-turnedsupport level of RM 6.10.
On the weekly chart, Axiata formed a "Long White
Candlestick" pattern, indicating that buyers have overcome sellers after a
brief tussle. The rise in the share price
came in a timely manner, having grazed at the short term support line. The move was necessary to prevent
further deterioration of the short term
technical picture. As it stands, the medium to long term technical outlook
remains solid with momentum and relative strength likely to continue.
Source: Kenanga
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