Sunday, January 15, 2012
BJCORP(3395)
Technical Analysis:
BJCORP is one of my favorite counter. Some trader only focus on this type of stock. They build a strategy call it swing trading, can make money as long as market volatility existing. However, today we evaluate our case study using RSI indicator. RSI is a one of the famous technical analysis tool to ensure the over brought and over sold of each stock. It is use for short term and it can detect the future movement before bullish and pick a best chance for entry price.
For our case study, now it showing the RSI moving below 30% and it is lowest price in pass if it is near 0%. That is why this counter is consider oversold, we always can pick up the lowest price when there is oversold by panic selling investor. In the case, I think the boss, Vincent Tan try to control his stock in this fluctuation way to panic investor. The fair value for this counter is RM 1, any price below is consider value investing for fundamental trader. However for technical analysis, we always enter the price when there is a buy signal.
In this case, you can see the blue arrow is the best chance to enter when RSI cross over 30% from below. Vice versa, the best sell signal occur when RSI crossing 70% from top, shown by red arrow. Lately, the RSI enter a oversold stage and improving toward 30%. We can by once the RSI touching 30% horizontal line. If not, we still need to wait long time until the best timing.
Strategy:
Buy: 0.93 or below
Sell: 1.02 or 1.05 once break 1.02
Cut lose: 0.9 (last panic selling resistant)
