Eye On Stock

ALAM Maritim Resources Bhd touched a low of 49 sen on Aug 13, the worst level since March 30, 2009 during the recent extended correction process. Thereafter, the shares turned rangebound on consolidation, lasting slightly more than a month before bouncing off in the wake of fresh bargain hunting buying momentum. This stock finished at a five-month high of 64 sen, up one sen yesterday.

Based on the daily chart, the gains in Alam Maritim over the past couple of weeks were supported by encouraging volumes. Other glaring positive development was prices had penetrated the important 200-day simple moving average (SMA) for the first time since June last year. These are supported by the ascending 14-day SMA and the 21-day SMA. As long as long as the two rising moving averages are intact, the prevailing short-term uptrend could be enhanced into a solid bullish wave going forward.

Elsewhere, the oscillator per cent K and the oscillator per cent D of the daily slow-stochastic momentum index were ticking up after triggering a short-term buy at the 67% level. Likewise, the 14-day relative strength index improved moderately from a reading of 64 in mid-week to end at the 76 points level. The daily moving average convergence/divergence histogram climbed in tandem with the daily signal line to retain the bullish note. It had issued a buy signal earlier of the month.

Amid promising landscape, Alam Maritim is set to firm on follow-through nibbling, with significant resistance seen at the 67 sen-70 sen band, of which a successful penetration would clear the way for the bulls to challenge the upper stiff barrier, resting at the 86 sen-90 sen range.

Pivotal support is pegged at the 14-day SMA of 57.5 sen. The lower 21-day SMA of 55.5 sen would act as the trailing stop-loss exit. —

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