Tenaga Nasional

Tenaga Nasional (Tenaga) is the electricity utility company in Malaysia and is mainly involved in the generation, transmission and distribution of electricity. Tenaga manages the electricity grids in both Peninsular Malaysia and Sabah.

Standard and Poor's (S&P) said in his stock commentary today that "We reiterate our Strong Buy recommendation and 12-month target price of MYR13.00". Risks to our recommendation and target price include Tenaga being made to absorb higher gas prices, the continued upward spiraling of non-gas fuel costs and weaker-than-expected electricity demand growth.

Tenaga Nasional Weekly Chart

Above is Tenaga Nasional weekly chart and I will put my comment on this counter. The 200 SMA is used to separate bull territory from bear territory. Since end of July 2006 Tenaga stock trading below 200 SMA which showing that it is in bear or downtrend mode. Technical indicator 14-weeks RSI set a new low while the indicator is not. This is triple bullish divergence. But I'm still thinking that the price will be at intermediate support at RM8.50 which at the same time relate to fibonacci 261.8% level. Patience is the key to success and we should waiting the confirmation signal for trading and take small risk that acceptable.

Additionally, Tenaga Nasional slid 20 sen or 2.1% to 9.25 ringgit after the company reported a lower-than-expected fourth-quarter net profit due to foreign exchange losses. Investors were also worried that higher power purchase costs and a potential increase in fuel costs may impact Tenaga's outlook next year.

Trading is on your own risk. Happy learning and happy trading!