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TMCNet:  DiGi likely to test immediate overhead resistance [New Straits Time (Malaysia)]

[May 04, 2014]

DiGi likely to test immediate overhead resistance [New Straits Time (Malaysia)]

(New Straits Time (Malaysia) Via Acquire Media NewsEdge) TECHNICAL rebounds on the Wall Street and regional stock markets provided the impetus for the local bourse to stage a follow-through rebound last week.

The FTSE Bursa Malaysia KLCI (FBM KLCI) posted a follow-through technical rebound. The FBM KLCI stayed above its downside support of 1,850 points when it closed at 1,869.08 points on Friday.

Once again, select heavyweights continued to play pivotal roles in lifting up the FBM KLCI above 1,860 points.

The benchmark index stayed above its downside support of 1,850 points when it hit an intra-week low of 1,852.27 points on April 29.

The FBM KLCI hit its intra-week low of 1,852.27 last Tuesday before rebounding to an intra-week high of 1,871.69 on Friday, with an intra-week trading range of 19.42 points.

It closed at 1,869.08 points last Friday, with a week-on-week gain of 8.10 points, or 0.44 per cent.

The FBM Small Cap Index lost 339.69 points, or 1.91 per cent, to 17,432.39 points while the FBM ACE Market Index tumbled 326.49 points, or 4.72 per cent, to close at 6,558.85 points on Friday.

In New York, the New York Stock Exchange staged a technical rebound last week. The Dow Jones Industrial Average closed higher at 16,512.89 points on Friday, with a week-on-week gain of 0.93 per cent.

The tech stock-heavy Nasdaq Composite Index moved in tandem with the broader market sentiment last week. It closed higher at 4,123.90 on Friday, with a week-on-week gain of 47.34 points, or 1.16 per cent.

Hong Kong stock market closed marginally higher last week. The Hang Seng Industrial Index closed at 22,260.67 points on Friday, with a week-on-week gain of 37.14 points, or 0.17 per cent. In the meantime, the Tokyo stock market rebounded in tandem with Wall Street last week.


The Nikkei 225 Index closed marginally higher at 14,457.51 points, with a week-on-week gain of 28.25 points, or 0.20 per cent.

On the home front, mobile services provider DiGi.Com Bhd staged a technical rebound last week.

Its daily price trend rebounded to close at RM5.53 last Friday, with a week-on-week gain of 18 sen, or 3.36 per cent.

Following are the readings of some of DiGi's technical indicators:- Moving Averages: DiGi's daily price trend stayed above its 10-, 20-, 30-, 50-, 100- and 200-day moving averages.

Momentum Index: Its short-term momentum index continued to stay above its neutral reference line .

On Balance Volume (OBV): Its short-term OBV stayed above the support of its 10-day moving averages.

Relative Strength Index (RSI): Its 14-day RSI stayed above 50 per cent. Its technical reading stood at 74.23 per cent on Friday.

Outlook Select heavyweight counters' technical rebounds continued to provide the thrust in sending the FBM KLCI to a brief re-test of its overhead resistance of 1,870 points.

Key heavyweights made some interesting market plays. DiGi was one of these counters with a week-on-week gain of 18 sen, or 3.36 per cent.

DiGi is part of the Telenor Group. The company is a global telecommunications services provider.

The company provides mobile voice, Internet and digital services in Malaysia.

Chartwise, DiGi's monthly price trend staged a decisive technical breakout of its immediate overhead resistance last week.

Its weekly price trend staged a decisive breakout of its immediate overhead resistance (See DiGi's weekly price chart - B1:B2).

DiGi's weekly price trend continues to stay within the confines of its intermediate-term uptrend channel (B1:B2 and B3:B4).

DiGi's daily price trend staged a technical breakout of immediate overhead resistance (See DiGi's daily price trend - C3:C4) and stayed above it on Friday.

Its daily, weekly and monthly fast MACDs (moving average convergence divergence) continued to stay above their respective slow MACDs at the market close last Friday.

Its 14-day RSI stood at 74.23 per cent last Friday. Its 14-week and 14-month RSI were at 71.19 per cent and 69.41 per cent respectively.

Following the successful breakout of its immediate overhead resistance on its weekly (B5:B6) and daily (C3:C4) price charts.

DiGi's price trend is now poised to move towards its immediate overhead resistance zone which is likely to be between RM5.55 and RM5.85.

The subject expressed above is based purely on technical analysis and opinions of the writer. It is not a solicitation to buy or sell.

(c) 2014 ProQuest Information and Learning Company; All Rights Reserved.

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