The year 2018 was a staggering year for Jaks, the stock plummeted -76.96% from RM1.80 to RM0.415. Traders without technical analysis knowledge would have held this stock not knowing when is the next bounce. Cut lost is vital in stocks trading. For example, the death cross is a good indicator of cutting lost especially for long term investors. You may set 10-day moving average (blue) and 65-day moving average (red) as your cut lost point. The picture shows the death cross was RM1.64, -8.94& from RM1.80.
If the trader did not manage to sell above RM1.50, the next opportunity is the bounce on 21st May 2018. The stock penetrated 65-day moving average with low volume but it did not ease further after 10-day moving days touched 65-day moving average. 10-day moving average below 65-day moving average is a strong indicator of selling is on the way. The bearish pattern was established with a gap down day on 30th May 2018. Here, the selling climate persisted for 7 months.
Strong demands rushed in to accumulate the stock on 30th November 2018. Although the stock fell another -16.55% in mid-December 2018, the higher volume compared to the previous 7 months hinted large operators continued to accumulate the stocks in the market. It was well supported above RM0.40 and the retest in January 2019 marked the possibility of supply.
The stock rallied 12.09% on 10th January 2019 and the consolidation showed the continuous rally might carry on. Here, the rally penetrated the downtrend line on 21st February with high volume, it revealed the stock was bottomed and prepared to ascend. The rise persisted for 1.5 months and the stock maintained above RM0.729. The stock penetrated RM0.865 resistance on 10th October and rallied until RM1.06 on 1st November.
The increasing quarter profits and the news of the ongoing power plant construction will enhance the demands of this stock. The stock has increased by 12.89% for the past 3 trading days. It would be a wise choice to wait for the price to settle and retest the next support. Patience is the key to success.