Exactly a
month back, we highlighted that SUNWAY had broken out of a Triangle resistance
(report dated 21 Feb). We revisited the stock yesterday and were pleasantly
surprised to find that the share price had gained 31 sen or 12% over the
one-month period to RM2.83. Even so, we believe that the share price could
potentially advance further. Yesterday, SUNWAY confirmed a "Bullish
Flag" formation after surging 9 sen. The "Bullish Flag" is
categorised as a continuation pattern, and typically represents the halfway
point of an overall move. As such, we reckon that the decisive breakout signals
a resumption of the uptrend, and that the bullish momentum could carry the
share price towards the "Flagpole" measurement objective of RM3.10.
Traders who intend to buy into the stock should also place a stop-loss just
below the recent low of RM2.70.
Source: Kenanga
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