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Vard Holdings: Will It Continue The Uptrend After Consolidation?
Trend Spotting | 20 September 2013
By: Robin Han
Articles (102) Profile

Vard Holdings had been declining for close to a year, over the September 2012 to August 2013 period. The counter, however, showed signs of uptrend in the past two months – it formed a bottom pattern as well as a skeleton for uptrend by posting some higher highs and higher lows, in addition, both the moving averages and MACD histogram are giving out bullish signals.

In the past few days, when the Straits Times Index kept rising, the counter did not rally and this gives us an opportunity to buy on weakness. This recent pull back does not mean that the counter is weak, on the contrary, it may be preparing to break the key resistance at $1.00. Notably, such buying on weakness has lower risk than chasing high. Furthrmore, given the new contracts secured in late-August and early-September, higher market expectations may provide impetus for it to rise higher.

One may consider buying the counter if it declines to the recent low at around $0.915, setting a stop loss below support level at around $0.885. Do note that its recent quarterly financial results were not overly positive, hence the stock may revert to downtrend after a mid-term rebound. As such, one should follow stop loss closely to be well-protected.

Daily Chart Of Vard Holdings

 

Robin Han is a Ph.D in Department of Chemical and Biomolecular Engineering and has got a solid foundation in the financial markets.

Please click here for more information about this author.


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