Aduh, the entire rubber glove makers' prices are continue to drop like nobody, including the leader. Overall, they have dropped around 23 to 38%. Harta has the strongest resistant so far, where share price only fallen around 23%, where Latexx and Supermx have fall 38% respectively.
The selling pressure continues after our hot topic discussion, and even worst on yesterday, thanks to OSK Investment downgraded from overweight to neutral, neutral call for Topglov, as well as Ringgit continues to strengthen up to RM3.09 today, the highest since the previous Asian crisis. And yet, still no buy back action from management.
With the deep fall of the prices, most of us are concerning whether the rubber glove industry is facing sunset and their prices will continue to fall. In fact, there are currently too many negative impacts on these glove makers, so selling pressure are unavoidable. But if we apply our common sense, it looks like they have been oversold. 5 to 10% of profit retraction doesn't mean the stock price should fall like waterfall, even close to 40%! These stocks fundamental remain okay, perhaps in mid to long run.
From technical analysis point of view, most of the stocks were broken the 2nd strong support line, except Adventa and Kossan. Meaning some of them might having the possibility to continue to fall. Perhaps a buy call is there, but we unable to catch the right timing. Perhaps technical analysis is helpful for a better entry cost.
Back to Supermx, if the price stabilize on tomorrow, it should has a chance to rebound. Else, we shall anticipating the price to be weaken to either RM4 or RM3.75. As for Topglov, RM5.26 should be a strong support line for it. Else, RM5 or 4.80 would be the next.
Between, Mudajaya dropping like shit today. What is the problem? Genting and GenM could be the next. Anyway, we have another 2 exciting trading days to go before weekend. Gambadeh!
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