SUPPORTLINE by FONG MIN YUAN

TOP Glove Corp Bhd is rising towards the 50-day simple moving average (SMA) on positive momentum as it continues its recovery from a sharp pullback on April 25 and 26. The stock hit bottom on April 26 at RM8.85, which breached the support in the form of the 100-day SMA, but managed a rebound shortly after. Climbing its way back up, Top Glove’s share price arrived at Wednesday’s session high of RM9.70. The counter looks poised for a positive crossing of the 50-day SMA at RM9.80, which would help to confirm a return to an uptrend. In the event of a crossing, Top Glove will reach for the upper ranges of the price chart as it next looks towards a crossing of the RM10 mark. Developments on the technical indicators are lending support to the bullish movement on the daily price chart. The indicators looks mostly positive for the stock with an improvement in the slow-stochastic momentum index as it crossed the 50-point mark to suggest growing bullishness. The 14-day relative strength index also also looking healthy as although its rise has tapered out at 42 points. The daily moving average convergence/divergence line remains below the zero line due to the recent pullback. However, it has slowed its decline and further growth in the share price over the following sessions will see a return to a northwards trajectory. The stock has been on an uptrend since September 2017, and given the sustained bullishness, is experiencing rising support from the long-term SMAs, especially the 100-day SMA that now rests at RM9.13. However, falling through this mark, the counter could see a further pullback to the RM8.60 line and the next support at RM8.20.

The comments above do not represent a recommendation to buy or sell.

Note: This article first appeared in StarBiz Premium yesterday.