Technical Buy

Chip Eng Seng Ltd – Daily timeframe (Update from 12 December 2017)

*Entry Price: 0.975     Stop loss : 0.880     Take profit : 1.040

*Chip Eng Seng has been added to the “Phillip 20 Portfolio“ since 12 December 2017

Current Sentiment: Bullish

Support 1: 0.920                   Resistance 1: 0.995

Support 2: 0.885                  Resistance 2: 1.040

Price rose as expected after the last update but failed to sustain the bullish momentum.  After hitting a high of 1.07 on 23/01/18, price began to move into a correction. That was more or less in line with the 1.05 psychological round number capping the upside movement.

However, with the past seven weeks of selling, price seemed ready to rebound back into the uptrend. The confluence of support at 38.2% Fibonacci retracement level and 0.92 support area succeeded in halting the selloff since 07/03/18. Additionally, the bullish follow-through since then has succeeded in breaking price above the pullback line and 20, 60 day moving average on 20/03/18 suggests an increasing bullish momentum. Moreover, the bullish break on 20/03/18 was backed by increasing volume.

Expect the uptrend to resume next for price to test the 0.995 resistance area followed by 1.040.

Note: Our current fundamental view on Chip Eng Seng is a Buy rating with a fair value of $1.21.