Following the recent selloff in the local market, CIMB's share price was not
spared as well. The share price ended 12 sen lower on Tuesday, contributing to
a 1.7-point drag to the index amid high
volume. It also broke below the upward sloping trend line the day before, and
we believe that this is likely a precursor to more downsides ahead. As the
share price approaches the RM7.10 trigger line on the daily chart, we expect
some degrees of support at these levels. That said, should CIMB stage a rebound
from here, we expect any gains to be limited by the RM7.40 support-turned-resistance
level.
On the weekly chart, CIMB has just broken below the trend
channel support at RM7.40, accompanied by
a negative crossover of the MACDSignal line. The ability of the share
price to end the week above the RM7.40 level is pivotal for the uptrend to
remain intact. Failing which, the 23.6% Fibonacci Retracement Line at RM7.15
would likely be retested. Further downside support is seen at RM6.80, while
immediate resistance can be found at RM7.40/50 and RM7.80.
Source: Kenanga
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