KUALA LUMPUR (Jan 30): CIMB Equities Research has a technical buy on Xingquan International Sport at 83.5 sen at which it is trading at a FY13 price-to-earnings of 1.9 times and price-to-book value of 0.6 times.
It said on Monday that the stock closed above its 50-day SMA on Friday on rising volume.
The research house said even though the stock is still in a downtrend, it believes that it may have hit a significant bottom in December following a surge in trading volume at the low. The burst in volume suggest a selling climax.
“Indicators are showing signs of improvement with its MACD moving back into positive territory while its RSI is starting to rise once more,” it said.
CIMB Research said the stock is a buy now with a stop placed below 74 sen. Prices could climb towards the resistance trend line at 92 sen in the near term. It added that there is a cluster of resistance between 92 sen and 99 sen, making it a likely stopping point.
“A breakout further would send prices shooting towards RM1.06-RM1.14 next,” it said.
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