CSC STEEL Holdings Bhd forged ahead on positive momentum on Wednesday to rise above the short-term descending trend line that has been in place since May 2017.
At its day’s high of RM1.65, the counter rose above the 100-day simple moving average (SMA) and hit an immediate resistance formed by a downside gap left behind in November 2017.
While the stock was seen struggling to breach this resistance level on Wednesday, another day of buying interest will see it enter more bullish trading levels moving forward.
Trading volume in the counter has picked up over the last two sessions, signaling improved buying interest, while the technical indicators show a positive signal.
The slow-stochastic momentum index has crossed into overbought conditions, but is moving ahead in a positive trajectory.
The daily moving average convergence/divergence histogram crossed into a “buy” signal on Tuesday, and is on the verge of passing the zero line into positive territory, signalling an uptrend. Meanwhile, the 14-day relative strength index is also moving bullishly ahead.
Based on the daily price chart, the stock could be looking for higher ground around the RM1.71 mark, and perhaps attempt to challenge the uppermost 200-day SMA at RM1.73.
To the downside, the counter could return below the short-term descending trend line at RM1.60. The short-term SMAs are presently converging near the RM1.50 mark, which should act as a supporting level in the event of a loss of momentum.
Breaking this level, the stock will see further support nearby at RM1.53, as the the counter closes a positive momentum gap left behind on Tuesday.
The comments above do not represent a recommendation to buy or sell.
Note: This article first appeared in StarBiz Premium yesterday.