Technical Buy

UMS Ltd – Weekly timeframe  

*Entry Price: 0.870    Stop loss: 0.770   Take profit : 0.985

*UMS Ltd will be added to the Phillip 20 Portfolio once the trade is triggered

Current Sentiment: Bullish

Support 1: 0.775                   Resistance 1: 0.945

Support 2: 0.745                   Resistance 2: 0.985

Since hitting a record high of 1.36 in March, price has been in a steep downtrend for the past five months. Price has fallen as much as –42% from the 1.36 high to the yearly of 0.775. Interestingly, after forming a new yearly low at 0.775 in June, that level has held up firmly for the past four weeks. Each test of the 0.775 level was relentlessly rejected showing some early sign of strength.

Moreover, on the weekly timeframe, the bullish rejection off the 0.775 support area on the week ended 13/07/18 has resulted in price forming a Bullish Engulfing Bar signalling for a reversal higher. In addition, the bullish rejection also broke price above the downtrend line with increasing volume further validates the bulls are getting back control.

Expect price to rebound higher next for the 0.775 support area to be the next Higher Low (HL) point for the long-term uptrend. For this rebound, price should be targeting the 0.945 resistance area followed by 0.985.