Cypark appears to have ended its downtrend last month afterclosing above RM1.75, breaking the series of lower highs. Consolidationnaturally takes over  at thisjuncture  and the broken resistance hasturned into support. Together with other positive indications, a continuationof the uptrend is to be expected as long as the stock stays above RM1.75.

The stock's downtrend since reaching its peak in April lastyear may be over soon. The stock's downward movement is clear from the seriesof lower highs, where the 50-day MAV line acted as a dynamic resistance.However, the technical picture has turned around and it is getting increasinglybullish going into 2012. The downward momentum eased after the stock could notconvincingly break below  the Oct2011-low of RM1.36 in Dec 2011. This was followed by the successful violationof the 50-day MAV line, with a high volume 'Long White' candle, in late Jan2012. Follow-through buying in February saw it breaking above both  the Oct 2011 high and 200-day MAV line.  This breakout should mark the end of the9-month decline. The month-long rally saw the stock rise to its 6-month high byhitting RM2.07, which is the high of Aug 2011 and low of May 2011. The positivelong-term indicator of a 'Golden Cross', where the 50-day MAV line crosses overthe 200-day MAV line, is about to occur too.

Finally, an upside bias is seen from the shallow sidewaysconsolidation to the Jan-Feb rally, correcting less than 50% of the rally.Thus, buying support is expected to come above the 50% level at RM1.75, alsothe level where the 'Golden Cross' will likely occur. In view of the positiveindications, purchases can be made above RM1.75 with a price below as the stoploss. A new high above RM2.07 will confirm the continuation of the rally and ameasured move target based on the Jan-Feb rally could see the stock at RM2.65.Resistance is also expected at Fibonacci levels of the April-Dec 2011 declineat RM2.30 and RM2.55, also the highs of July and June 2011 respectively.However, note that the upside bias will be significantly reduced should theRM1.75 level be violated, after which a sideways move will likely ensue.

Source: OSK188