Wednesday, June 29, 2011

CIMB Research has Buy on Gadang

KUALA LUMPUR: CIMB Equities Research has a technical'' Buy on GADANG HOLDINGS BHD [] at 69.5 sen at which it is trading at a price-to-book value of 0.6 times.

It said on Wednesday, June 29 that Gadang is still consolidating in a descending wedge pattern but it believes the correction tone is at its tail end.

'The candles are now sitting above its 50-day SMA, waiting for a breakout above the wedge resistance. Follow through momentum should pick up once prices swing past the RM0.70 level. The following resistance levels are RM0.765 and RM0.805,' it said.

CIMB Research said traders with higher risk appetite may want to get in here with a stop placed below the RM0.63 level.

MACD has staged a golden cross, pushing its histogram bars into the positive territory. RSI has also bounced off its low to above the 50pts mark.

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