However, the positive technical picture will only be affirmed by a weekly close above the all-time high weekly close of RM1.20. That will see a violation of the 4-year old resistance level, and a strong move is always expected on breakout from a long-term resistance level. A price of RM1.80 is not impossible, but a conservative projection could see it testing RM1.60, a measured move based on the 2009-2011 rally. Minor resistance is expected at RM1.40, a projection based on the 2010 rally. Strong support is clearly at the 2011 low of above RM0.97, which also exhibits the most oversold weekly RSI level since early 2009, and a close below that level can be employed as a stop. Thus, positions can be initiated at the current level or if possible, on pullback towards the support level. A close below RM0.97 will invalidate the trade, and the price may trade at best sideways, between the wide range of RM0.60 and RM1.20.
Friday, November 25, 2011
UNICO - Approaching 4-year Resistance (OSK)
Unico continued to outperform the benchmark FBM KLCI since the price has started resuming its firm upward run in early 2010. The share price is now within touching distance of the 4-year resistance level and a good break above that level should see it accelerating even higher, leaving many laggards in its trail.
However, the positive technical picture will only be affirmed by a weekly close above the all-time high weekly close of RM1.20. That will see a violation of the 4-year old resistance level, and a strong move is always expected on breakout from a long-term resistance level. A price of RM1.80 is not impossible, but a conservative projection could see it testing RM1.60, a measured move based on the 2009-2011 rally. Minor resistance is expected at RM1.40, a projection based on the 2010 rally. Strong support is clearly at the 2011 low of above RM0.97, which also exhibits the most oversold weekly RSI level since early 2009, and a close below that level can be employed as a stop. Thus, positions can be initiated at the current level or if possible, on pullback towards the support level. A close below RM0.97 will invalidate the trade, and the price may trade at best sideways, between the wide range of RM0.60 and RM1.20.
However, the positive technical picture will only be affirmed by a weekly close above the all-time high weekly close of RM1.20. That will see a violation of the 4-year old resistance level, and a strong move is always expected on breakout from a long-term resistance level. A price of RM1.80 is not impossible, but a conservative projection could see it testing RM1.60, a measured move based on the 2009-2011 rally. Minor resistance is expected at RM1.40, a projection based on the 2010 rally. Strong support is clearly at the 2011 low of above RM0.97, which also exhibits the most oversold weekly RSI level since early 2009, and a close below that level can be employed as a stop. Thus, positions can be initiated at the current level or if possible, on pullback towards the support level. A close below RM0.97 will invalidate the trade, and the price may trade at best sideways, between the wide range of RM0.60 and RM1.20.
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