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DSONIC (5216) - Eye on stock: Datasonic Group

AFTER finding shelter at the one-year low of RM1.11 in late February during the previous correction phase, Datasonic Group Bhd (Dsonic; Code: 5216) shares staged a rebound in the wake of renewed bargain hunting.

However, the recovery was short-lived as the upward momentum lasted only two weeks before pucturing at RM1.34 on March 13, followed by a brief and mild pullback.

Shortly after, Dsonic made another effort to advance, but could not attract follow-through interest, which saw prices fizzling out at the RM1.33 level earlier this month.

In the latest attempt, Dasonic shares hit a high of RM1.32 during intra-day session on Thursday before turning range-bound while the bulls generally paused for a breather yesterday.

Based on the daily chart, it appears the young bulls are having some difficulties keeping the posture above the uppermost 200-day simple moving average (SMA) line due to lack of follow-through interest and hence, the momentum could not be sustained in March and April.

Unlike the previous two occasions, the bulls may be lucky this time round, with trading volumes building up apparently.



Elsewhere, the oscillator per cent K and the oscillator per cent D of the daily slow-stochastic momentum index were ticking down after triggering a short-term sell near the overbought area on Thursday.

In stark contrast, the 14-day relative strength index rose from a reading of 34 on April 19 to settle at the 70-point level yesterday.

The daily moving average convergence/divergence histogram climbed above the daily signal line to issue a buy signal yesterday.

Except for the daily slow-stochastic momentum index, other indicators are painting a positive landscape, implying a positive breakout of the 200-day SMA of RM1.33 is imminent.

The next upper hurdle is pegged at the RM1.45 level, of which a clear penetration will see the bulls becoming more aggressive, probably en route to the RM1.70 mark.

Current support is anticipated at RM1.20 and concrete floor is set at the 99.5 sen-RM1 area. – By K.M. Lee

The comments above do not represent a recommendation to buy or sell.


DSONIC (5216) - Eye on stock: Datasonic Group
http://www.thestar.com.my/business/business-news/2017/04/29/eye-on-stock-datasonic-group/
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