RSAWIT: Technical rebound amid grossly oversold position

• RSAWIT’s recent correction from 52-wk high of RM1.22 (10 Feb) to RM0.99 (16 May) has nearly reached the weekly lower Bollinger band at RM0.98 and we think a temporary base has been formed and a rebound is in the pipeline.
• If prices can continue to consolidate upwards after recent breakout from its downtrend channel (FIG3), there is a good chance that RSAWIT may reclaim RM1.07 (50% FR) and RM1.10 (38.2% FR) levels. A breakout above RM1.10 will spur prices to retest RM1.12 (23.6% FR) and 3M high at RM1.16. Significant resistance is RM1.22.
• Supports are RM0.97-0.99 and RM0.97 (100-d SMA). Cut loss below RM0.96.

Source: Hong Leong Investment Bank Research - 18 June 2012