SERBA Dinamik Holdings Bhd's rebound continues to gain traction as it attempt to resume the dominant uptrend on the price chart.
Following a correction, the stock embarked on a recovery on Feb 4. That positive momentum has followed through to the most recent trading session.
Looking at the daily price chart, the bulls remain in control as the share price remains trading above all the key simple moving averages (SMA), which face upwards to reflect the growing price trend.
However, there remains an obstacle in the way of the bulls. At Wednesday's closing price, the share price rested just higher than the top end of the immediate resistance at RM2.35. Short of a convincing breach, the resistance could serve to keep the stock under consolidation pressure.
Tellingly, the slow-stochastic momentum index has descended to the neutral area after briefly crossing into overbought territory.
However, this pause is expected to be temporary. Further buying interest and a breach of this mark would confirm the strength of the bulls, and on the back of sustained buying interest, see them roam towards the historical high of RM2.52 that was achieved on Jan 6.
It remains promising that the daily moving average convergence/divergence (MACD) line shows an intact uptrend. The MACD is also on the verge of crossing above the signal line, which would indicate the return of bullish momentum.
The 14-day relative strength index also remains healthy as it continues to rise at 65 points.
To the lower end of the chart, support is found at RM2.25. The 50-day SMA is also rising near RM2.20 to suggest further support. In the event of a negative breach, the stock will find itself at risk of resuming its correction phase as it heads towards RM2.15.
The comments above do not represent a recommendation to buy or sell.