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Monday, September 7, 2009

Eastern & Oriental (EAST MK; RM1.50) - BUY (CIMB)

FY10P/E: 28.3x, P/BV: 1.1x

• The uptrend channel since Mar-09 is still intact. However, it may be poised for a short breather after recent strong rally. The formation of a “Doji” last Friday shows that buying momentum has slowed.

• MACD has staged a positive crossover but RSI is fast approaching the overbought territory. A healthy consolidation would help to neutralise these indicators.

• Accumulate on weakness, preferably near the RM1.40 and RM1.25 supports. There is a minor resistance at RM1.53, followed by RM1.60 and RM1.70.

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