Friday, August 26, 2011

CIMB Research has Technical sell on KLK

KUALA LUMPUR: CIMB Equities Research has a Technical Sell on Kuala Lumpur Kepong at RM21.48 at which it is trading at a FY12 price-to-earnings of 16.4 times and price-to-book value of 3.4 times.

It said on Friday, Aug 26 that prices appear to be forming a bearish wedge pattern here where there is one more short push to complete this pattern. Prices would also have a tough time taking out the moving averages.

'Hence, in the near term, gains are likely to be capped at RM21.80 to RM22.20. Near term indicators are still positive, which supports the final upward push,' it said.

CIMB Research said traders would likely be better off taking profits on strength. Once this bearish wedge pattern ends, its expect prices to tumble below the RM19.74 levels. And in breaking this key support, the stock would have a RM16.00 target for the medium term.

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