Ex­pec­ta­tions

Finweek English Edition - - INVESTMENT -

ter­mi­na­tion rates also play­ing a piv­otal role. It has also em­barked on a jour­ney to bring fi­bre-to-the-home to neigh­bour­hoods, al­low­ing for broad­band speeds of up to 100 Mbps. All this has con­trib­uted to the spike in the price. POS­SI­BLE OUT­COME: The monthly rel­a­tive strength in­dex (RSI) is ex­tremely over­bought. How­ever, Telkom could still test both the 4 700c/share and the 5 030c/ share lev­els – be­fore en­coun­ter­ing re­sis­tance that should trig­ger a pull-back – pos­si­bly through the sup­port trend­line of the cur­rent up­trend. A re­ver­sal be­low 3 940c/share should sound the alarm bells. How­ever, we ex­pect sup­port to re­main firm at 3 030c/share and prompt a re­cov­ery that should see Telkom re­sume its bull trend to­wards the 6 210c/share– all-time high. This pull-back would of­fer in­vestors an­other buy­ing op­por­tu­nity, and given that Telkom is only trad­ing in the first phase of its pri­mary bull trend, there is plenty of room for the sec­ond and third phases to form to new Fi­bonacci highs in the long term. AL­TER­NA­TIVE SCE­NARIO: Telkom will retest its all-time high de­spite is mega-over­bought po­si­tion on the monthly chart – thereby in­creas­ing the prob­a­bil­ity of an even sharper and rapid pull-back. Ei­ther way, Telkom needs to cor­rect!

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