MISC has been trending lower after peaking in 2007 but thestock's recent record trading volume opens up the possibility of a  change in its  5-year trend. However,  the stock must hold  at the current  psychological support  at  RM5.00 and successfully violate the 200-dayMAV line to confirm the change in its longer term trend.

There is no doubt that MISC is on a longer-term downtrend,which is clearly illustrated by the series of lower highs and the declining200-day MAV line. The downtrend saw the stock shedding  by half its 2007 peak  price  of RM10.00. However, a change in trend couldbe in store if the share price can hold above its recent low at thepsychological RM5.00. The stock's recent record volume would certainly havecaught the attention of bottom-fishers as this could signal the return ofbuyers and the flushing out of weak hands by strong hands. In fact, steadybuying was seen throughout March, during which the gradual rise in volumeculminated in the recent one-day volume spike. The candles formed last weekalso indicate buying, with a 'Long Legged Doji' and 'Dragonfly Doji' appearingon 14 and 15 March respectively. The pair of 'Dojis' highlights the lack offollow-through selling as the pair came after the 'Long Black' of 13 March.

Nonetheless, in light of the longer term trend, only ashort-term bottom can be expected at the moment. This expectation will requirea close above the 'Long Black' candle high of RM5.25, which happened yesterdayvia a 'Long White' candle. Thus,  a  purchase can be made  now or on a pullback towards the stop loss at the  psychological RM5.00level. The price target is the gap of 23 Feb at RM5.75, which is a recoup of62% of the Feb-March decline.

The possibility of a change in the longer term trend willrise if the stock can break above RM5.75. This change in trend will only beconfirmed if the price violates the 200-day MAV line, which now lies at RM6.50.Resistance is also expected at the 100-day MAV line ' now at RM6.00 ' whichacted as the dynamic resistance level a number of  times last year. However,look for thedowntrend to continue should the stop loss be triggered, with RM4.40 as thenext target, which is a measured move based on the Nov-Dec 2011 decline.

Source: OSK188