Category Archives: KSL

The Hot and Sizzling Property Sector

Property shares have been in the limelight for almost a quarter and most have sky-rocketed to a very dangerous level. At this stage, the risk-to-reward ratio is definitely at the high side and we should not chase after these stocks. Having said that, there are still plenty of opportunities to profit from the swings. We shall look at the current situation of a few property stocks from the technical point of view and see how we can attempt to profit from them in the near future at low risk. Let’s start our analysis with Tebrau [1589].

After moving within an upward channel for close to 2 months, Tebrau’s share price managed to break above the the ascending broadening wedge with high volume on the 15th of March, sending the share sky-high in subsequent days. Despite supported by volume, its share price has moved too much in too short a period (an average of 7% a day for the past 5 days), making a correction very likely in the near term. The correction that follows should be one of high magnitude since a parabolic movement can be clearly seen in Tebrau’s share price. Reflexivity is obviously at work and any slight uncertainty will trigger the first batch of selling, which will create fears in others to take profit or to cut loss, thereby reinforcing the downward movement. The uptrend could continue for a day or two, but at this juncture the risk is much higher than its reward and thus interested party that are looking to take a long position should refrain themselves from joining the herd in the next 2 days. Remember, losing the opportunity is always better than losing the money. Do not bet on overbought shares, thinking that they would the next big thing. The best strategy now would be to enter only after the share price has retrace to a much lower level, possibly at the 50% retracement level of the most recent up wave, or at RM1.05, a major support level. Next, we take a look at KSL [5038].

Stock to Watch: KSL [5038]


Why is it that KSL is attractive on the 13th of March when it is trading at such a high price compared to the past few months? In making our analysis on this property company, we shall employ day-to-day bar analysis as well as candlestick pattern. We start from 7th of March, when price shot up and closed above RM1.75 with high volume, indicating bullishness. The day after, a doji with long tail is formed, reflecting a possible reversal. For a reversal to be confirmed, the share price must close below the immediate support of RM1.75 in the next few days. On the 11th of March, the share price opened higher and closed lower at the immediate resistance, making the reversal very likely. At this point we should be expecting another black candlestick on the next day that will bring the share lower and thus confirm the downtrend. But instead of moving down, it moved up and managed to close near the high on the 12th of March. This price development that went against the expectation signaled a possible continuation of trend. The bullishness is further supported by its ability to not just stay above the immediate support of RM1.75 but also closed near its high on the 13th of March, when the broad market shed more than 10 points. Let’s check its relative volume density (RVD) as well.