TECHNICAL BUY

Chip Eng Seng Ltd – Daily timeframe  

*Entry Price: 0.945                             Stop loss : 0.880                   Take profit : 1.050

*Chip Eng Seng Ltd will be added to the Phillip 20 Portfolio once the trade is triggered

Current Sentiment: Bullish

Support 1: 0.900                   Resistance 1: 0.995

Support 2: 0.885                   Resistance 2: 1.050

Price has been moving in a sturdy uptrend since January 2017 after it broke above the 0.660 range high. The uptrend went for another leg higher subsequently in August after price broke above the 0.745 range high and 0.765 ceiling.

However, after testing the 0.995 resistance area on 24/10/17, price went into a correction mode.

Nonetheless, the uptrend remains intact as price found a near-term base at the confluence of 60 day moving average, 38.2% Fibonacci retracement level and 0.900 resistance turned support area. Moreover, the double bottom rejection off the 0.900 support area on 16/11/17 and 07/12/17 proved the importance of the support area. In addition, the subsequent bullish follow through on 11/12/17 succeeded in closing price above the immediate pullback line and 20 day moving average suggests a reversal back into the uptrend.

Expect the uptrend to resume next for price to test the 0.995 resistance area followed by 1.050.

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