KUALA LUMPUR (Nov 22): CIMB Equities Research has a technical sell on DRB-Hicom at RM2.12 at which it is trading at a FY12 price-to-earnings of 10.6 times and price-to-book value of 0.8 times.
It said on Tuesday that DRB-Hicom could potentially be forming a head & shoulders (H&S) pattern with the current rally being the right shoulder.
“It is now testing its strong support turned resistance levels of RM2.19-RM2.28. The recent reversal after touching this resistance band does not augur well for the bulls,” it said.
CIMB Research said the MACD has just issued a sell signal while its RSI has turned down after failure to breakout into overbought levels.
The research house said any more rallies into the said resistance band is a chance to sell.
“Aggressive traders should take profits now with a buy stop placed above RM2.30. Any closing below the 50-day SMA would mean that prices are likely to head back to retest the H&S neckline at RM1.70,” it said.
It said on Tuesday that DRB-Hicom could potentially be forming a head & shoulders (H&S) pattern with the current rally being the right shoulder.
“It is now testing its strong support turned resistance levels of RM2.19-RM2.28. The recent reversal after touching this resistance band does not augur well for the bulls,” it said.
CIMB Research said the MACD has just issued a sell signal while its RSI has turned down after failure to breakout into overbought levels.
The research house said any more rallies into the said resistance band is a chance to sell.
“Aggressive traders should take profits now with a buy stop placed above RM2.30. Any closing below the 50-day SMA would mean that prices are likely to head back to retest the H&S neckline at RM1.70,” it said.
