Eye on stock; Felda Global Ventures

SHARES of Felda Global Ventures Holdings Bhd (FGV; Code: 5222) touched an all-time low of RM1.18 on Aug 26 last year.

After a long bearish move, prices turned sideways briefly before they embarked on a recovery phase in the wake of fresh bargain hunting momentum.

However, the plan was aborted 10 weeks into the rally at a peak of RM2.04 on Nov 6, last year, because FGV could not attract solid follow-through interest but profit-taking activity.

Consequently, the shares retreated gradually, but just when it appeared frail and in great danger of falling back to test the floor or making a new lows sometime in May this year, another bout of fresh nibbling emerged from the sidelines, helping prices recover to the RM1.59 level.

Thereafter, they traded mostly mostly range-bound on consolidation.

It looks like the worst for this counter may be over, with the sightings of sporadic buying on the tracking system recently, meaning smart hands may be accumulating.

If the recent buying is real, the next phase would be the recovery story. Perhaps, investors can consider taking a positive while prices were still flirting at an attractive level.

Strong resistance is pegged at the RM2.04 barrier, of which a successful breakout would see the fortune of FGV turning brighter. When that happens, FGV will be good for a long position.

Initial support is anticipated anticipated at RM1.45, followed closely by the RM1.42 level.

The next lower support of RM1.30 will act as an important floor.

Elsewhere, the 14-day relative strength index firmed to a reading of 62 yesterday, up from the 43 points level the prior week.

Though the daily moving average convergence/divergence histogram still flirting below the daily signal line, the former line had indicated a strong convergence pictogram and may climb above the latter line in the next few days to trigger a buy signal.

Technically, indicators are improving, suggesting FGV shares may drift sideways to marginally higher until a clearer picture emerges. 

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