SUPPORTLINE by FONG MIN YUAN

BERJAYA Sports Toto Bhd saw continued advance in share price on Monday, following Friday’s jump on positive news. The presence of a ‘death cross’ since early October due to the negative crossings of the 50-day and 100-day SMAs offer a long-term negative outlook on the share price. The stock has been on a decline since falling off a peak of RM2.62 on June 10. While there was one prior attempt to reverse the downtrend in September, the recovery was brief, resulting in a subsequent pullback to a bottom of RM2.01 on Oct 24. Monday’s push to an intra-day high of RM2.28 helps to confirm that the rebound has taken root. The momentum indicators are looking positive, suggesting that this advance has legs. The slow-stochastic momentum index, however, has taken a descending angle at 70 points, suggesting slowing strength. The 14-day relative strength index has breached the overbought line at 73 points but remains in a positive trajectory. The daily moving average convergence/divergence line is also rising off the signal line after issuing a ‘buy’ signal. The recovery may see the share price cross the long-term 100- and 200-day SMAs to approach the target of RM2.33. This would serve as an opportunity for investors to take a breather from the advance, but if buying interest should resume, the next target could lie at the the September high of RM2.38. The stock sees lower support at RM2.13 with further support resting at RM2.06.

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

Note: This article first appeared in StarBiz Premium yesterday.