Stock Fundamental Analysis 1. Introduction to the stock 1.1 Company Stock Summary 1.2 Historical Stock Price Charts (Short-term 1 year) 2.1 Technical Analysis 2.1.1 Support & Resistance or Trendline 2.1.2 Volume Analysis 2.1.3 Candlestick Patterns 2.1.4 Price Pattern 2.2.Technical and Momentum Indicators 2.2.1 Rate of Change (ROC) 2.2.2 Moving Average Convergence Divergence (MACD) 2.2.3 Bollinger Bands 2.2.4 Relative Strength Index (RSI) 2.4 Price Forecast (Short-term perspective) 2.5 Overall sentiment TABLE OF CONTENTS 1 Introduction to the stock 1.1Company Stock Summary Company Name : Top Glove Corporation Bhd Company Website : https://www.topglove.com/home Market : Main Market Industry :Medical Specialties Sector : Health Care Date Listed in KLSE: August 2001 Enter Main Board :May 16, 2002 Symbol : TOPGLOV Stock Code : 7113 ABSTRACT Analyst: Iffah Izzati Binti Muhamad Sulung @ Malik Report Date: 08/ 07 / 2022 TOP GLOVE CORPORATION BHD Health Care This report is made to give a clear sign to buy and sell in Top Glove Corporation Bhd. In order to make the right decision, Firstly, we will use technical analysis by determining the support level, resistance level, trendline, and volume analysis to know the stock performance and whether it is good to invest in. Besides, there is also information on the stock candlestick pattern and price pattern. Moreover, the most important thing while doing technical analysis s to do the technical and momentum indicators. I have chosen bollinger bands, rate of change, moving average convergence divergence, bollinger bands, and relative Strength Index. Thus, I believe all of the information given will be useful for the investor to analyze the stock for investing. BUY (MYR) Target Price : 2.805 Entry Price : RM 1.030 Stop Loss: RM 0.805
Analyst: Iffah Izzati Binti Muhamad Sulung @ Malik TOP GLOVE CORPORATION BHD Health Care 1.2 Historical Stock Price Charts 1( short-term - 1 year) Diagram 1 :1 year Top Glove Stock (Jun2021 - Jun2022) The chart above is the historical Top Glove Price chart from Jun 2021 until Jun 2022. Based on the charts, indicate that the price is going downturn. This happened may be due to the demand for masks and gloves getting lower as the Covid-19 pandemics are getting better in almost all countries including Malaysia. The range price from Jun 2021 - Jun 2022 was RM0.95 - RM4.72. RM4.72 is not the higher stock price ever reached, the higher the stock reached is RM9.34 which is on October 2020 due to the pandemic that give a positive effect on Top Glove stock. On 23rd Jun 2021, the stock price is RM4.45 and the opening price was RM7.00. It is quite high compared with the current price which on 23rd Jun 2022 is RM1.04 and the opening price was RM1.02. However, the stock price on 23rd Jun was increasing by 2.97% from the previous price, RM1.01. Besides, the current opening price was RM1.02 while the closing price was RM0.92. From 23rd Jun 2021, it is the highest price during this period which is RM4.45 while on July 7, 2021, the price started bearish to RM3.72 then tried to upward back to RM4.10. When it enter the new month which is September, it started a downtrend until November which reach RM2.26. Besides, as you can see from the chart, in December 2021, the candlestick suddenly uptrend, and it will be suggested to sell the shares during that period. After entering the new year which is 2022, it shows a downtrend or bear market of the stock. On 1st July 2022, the price of the stock was RM2.47 then it keeps going downtrend to RM1.71 and the current price was RM1.07 which indicates a continuously decreasing and proves a downtrend. Moreover, the opening price in 2022 was only around RM2.73 to RM0.94. Report Date: 08/ 07 / 2022 (MYR) Target Price : 2.805 Entry Price : RM 1.030 Stop Loss: RM 0.805
Analyst: Iffah Izzati Binti Muhamad Sulung @ Malik TOP GLOVE CORPORATION BHD Health Care 2.1 Technical Analysis 2.1.1 Support, Resistance and Trendline Diagram 2 : Technical Analysis of Top Glove Stock Daily This is the trendline on daily basis with the current price is RM1.04. Firstly, need to identify the resistance level and the support level. In order to identify resistance level and support level, it must have at least have 2 or more candlestick touches together. Thus, as we can see the resistance level is at the top as it is a higher level of price and will continue to rise until hits a ceiling. Based on the chart, the resistance level was RM2.54. Meanwhile, the support level is on the bottom as it is represented as a lower level of the price which at RM1.005. On the support level, usually, people will enter as a buyer while sellers will enter at the resistance level. Both of these levels are important to identify which price is suitable before buying or selling it. Next, we will take a look at the movement of the candlestick. Clearly here, the candlestick was moving downtrend with the lower-low and lower-high. Since the chart indicates a downtrend, it was good to enter the stock as a buyer at RM 1.040 on 23rd Jun 2022. Then, I will expect the price to rebound to resistance and at this point, we should sell it as it at the higher price which is RM2.54. If we sell at RM2.54, thus we will exit the stock. However, if we set the profit target at RM2.50 and when the price reaches it, we will automatically out from the stock and gain a profit of RM1.46 for 1 stock. Besides, in order to avoid any loss, we need to set our stop loss due to the movement of the stock price is unpredictable. Therefore, as we enter as a buyer, the stop loss will be below the support level. Since we buy the stock at RM1.040, if the price hits RM0.90, we will loss if we are not set the stop loss there. Report Date: 08/ 07 / 2022 (MYR) Target Price : 2.805 Entry Price : RM 1.030 Stop Loss: RM 0.805
Analyst: Iffah Izzati Binti Muhamad Sulung @ Malik TOP GLOVE CORPORATION BHD Health Care 2.1.2 Volume Analysis Volume analysis is to look at how many shares or contracts of security have been traded within a specific time period. The volume of the stock for Oct 2021 - Jun2022. The higher volume is in December 2021. The high volume indicates more buyer is buying the stock. It also indicates a strong market as the price and volume are high. Then, from April to May, the volume shows a small pattern compared to December 2021. This may due to the stock are not active during that period. Moreover, we can see from June to July, the volume is higher but the price chart is close to the support level. This indicates the market is weak and advises the trend will not hold longer and can be reversed. However, the weak market won't be long, the stock price will be rises back to the good stock condition. Report Date: 08/ 07 / 2022 Diagram 3 : Stock Volume Analysis (MYR) Target Price : 2.805 Entry Price : RM 1.030 Stop Loss: RM 0.805
Analyst: Iffah Izzati Binti Muhamad Sulung @ Malik TOP GLOVE CORPORATION BHD Health Care 2.1.3 Candlesticks patterns Hammer In the trendline above, the hammer pattern can be seen on 28th June 2022 at RM1.035. A bullish hammer is a single candle on a price chart that indicates a bullish reversal where buyers are momentarily in control. The pattern creates a hammer-shaped candlestick with a short green candle and a long bottom shadow indicating that the market is refusing to accept lower pricing. The length of the wick is at least 2 times the body. The hammer usually appears at the support level as we can see from the candlestick above. The long the wick indicates the better the price rejection. Moreover, it also tells us that the buyers have come a long way and pushed the price back all the way up to higher. The sight of the hammer gives possibilities for traders to enter into a long position. However, this does not suggest that they should make all of their purchases at once. A bullish trading pattern indicates a stock has found its bottom and is ready for a trend reversal. When sellers enter the market during a price decrease, the hammer candlestick appears. After that, buyers absorb selling pressure and drive the market price near the starting price by the time the market closes. The close price might be above or below the opening price, but it should be around the open to keep the real body of the candlestick small. Diagram 1: Hammer Report Date: 08/ 07 / 2022 (MYR) Target Price : 2.805 Entry Price : RM 1.030 Stop Loss: RM 0.805
The price pattern of Top Glove Corporation is double top. A double top shows an 'M' shape which indicates a bearish reversal in trend. The tops are peaks that occur when the price reaches a particular level that cannot be breached. The price will briefly reverse its steps after reaching this level before coming back to test it once again. If the price bounces off that level once more, a double top will appear. The double top usually appears for a longer period of time. The chart above indicates a double top of Top Glove Corporation from Jun 2020 to Mar 2021. The high price reached is RM9.765 which is the resistance level while the support level is RM4.480. As the price has decreased, we will enter the stock as a seller at RM6.115 on 5th February 2021. After that, when entering as a seller, the target price will be lower than the price entered, thus the target price is RM2.620.When the price hit this level, it will automatically out from this trend and gain profit from the entry price. It is by the entry price minus target profit, equal to RM3.495. for one stock. Besides, the stop loss is needed in order to avoid any losses. When hitting this stop loss level, you will out from it without facing any losses. Analyst: Iffah Izzati Binti Muhamad Sulung @ Malik TOP GLOVE CORPORATION BHD Health Care 2.1.4 Price Patterns Diagram 2 : Double Top Price Patterns Report Date: 08/ 07 / 2022 (MYR) Target Price : 2.805 Entry Price : RM 1.030 Stop Loss: RM 0.805
Analyst: Iffah Izzati Binti Muhamad Sulung @ Malik TOP GLOVE CORPORATION BHD Health Care The rate of change is simply a momentum oscillator indicator. It measures the percentage change in price between the current price and the price a certain number of periods ago. This indicator has a little bit the same as RSI as it also looks at the overbought and oversold line. If the ROC line move over the overbought line, it is a sell signal for investor meanwhile, if the ROC line move over the oversold line, it is a buy sign. When the ROC is positive and rising, the buying pressure is increasing as happened in December 2021. Besides, when investors saw the ROC line was declining to cross the oversold, they believe the price will increase later. This can be seen in June 2022, it is a buying signal and the investor will enter as a buyer at RM1.08 and set the target market at RM2.09 in order to gain a profit of RM1.01. Thus, using this indicator need to look at the line movement either move to overbought or oversold. 2.2 Technical and Momentum Indicators 2.2.1 Rate of Change (ROC) Diagram 1 : Rate of Change 9 days Report Date: 08/ 07 / 2022 (MYR) Target Price : 2.805 Entry Price : RM 1.030 Stop Loss: RM 0.805
Analyst: Iffah Izzati Binti Muhamad Sulung @ Malik TOP GLOVE CORPORATION BHD Health Care 2.2.2 Moving average convergence divergence (MACD) Moving average convergence divergence has 3 things which is the MACD line, signal line and histogram. The MACD line is the blue colour and the signal line is the orange colour. The crossover of the MACD line and the signal line will indicate the sell and buy signal. When the MACD line falls across the signal line, it indicates a sign to sell. Meanwhile, when the MACD line rises above the signal line, it's shown a buy sign. MACD has MACD crossover which we can see on the MACD line and signal line, bullish and bearish divergence, and MACD rises or falls. Based on the chart above, the higher price is RM3.42 in November 2021. After that, the price started to go downtrend until July 2022 and reach its lowest price, RM1.02. The MACD line and the signal line shows that the line is going down. The histogram is also indicate more red colour than green colour which shows a downtrend price. When looking at the histogram from April 2022 to July 2022, the graph is not high since the price is going downtrend. Diagram 2 : Moving Average Convergence Divergence (MACD) Report Date: 08/ 07 / 2022 Enter as a buyer at RM1.095 (MYR) Target Price : 2.805 Entry Price : RM 1.030 Stop Loss: RM 0.805
Analyst: Iffah Izzati Binti Muhamad Sulung @ Malik TOP GLOVE CORPORATION BHD Health Care 2.2.3Bollinger Bands Bollinger Bands is a technical indicator. Its help to determine if relative price levels are high or low. It has three lines, with the middle one being the moving average and an upper and lower line being the standard deviations. To use this indicator, we identify the buy and sell signal by looking at the candlestick. When the candlestick moves over the upper or lower line, it shows a sell or buy sign. The probability of a significant price move in either direction increases when the bands close during a time of low volatility. This could be the start of a trend. A false move in the other direction that reverses before the correct trend starts should be avoided. The volatility rises and any current trend may be coming to an end when the bands diverge by an unusually high amount. The resistance level was at RM2.80 then the trend is clearly shown a downtrend starting from December 2021 until July 2022. Thus, on June 14, 2022, the candlestick was go down over the bollinger bands line which indicate a buy sign at RM1.09. Investor enter as a buyer at RM1.09. We can put the target profit at RM1.575 to get a profit of RM0.51. Lastly, pegged the stop loss at RM0.098 which will automatically exit the trend. Clearly, this is how bollinger bands works. Sell Diagram 3 : Bollinger Bands Report Date: 08/ 07 / 2022 (MYR) Target Price : 2.805 Entry Price : RM 1.030 Stop Loss: RM 0.805
Analyst: Iffah Izzati Binti Muhamad Sulung @ Malik TOP GLOVE CORPORATION BHD Health Care 2.2.4 Relative Strength Index (RSI) The relative strength index is a momentum oscillator. The RSI oscillates between zero and 100. It is usually to indicate the speed and change of price movements. To identify the signal of buy or sell, firstly, we need to spot the oversold and overbought. The oversold will be below 30 while oversold will be 70 - 100. When the graph crosses either the oversold or overbought line, it will indicate a potential entry or exit signal. Based on the chart above, the RSI peak at 50% rather than 70% during a decline, which might be used by investors to more accurately predict bearish conditions. The oversold indicates a buy signal. When the line crosses the overbought line, it's shown the sell signal. Besides, when the RSI line declines until below the oversold line, it indicates a buy signal. The RSI also indicates a buy signal as the RSI was previously below 50 and then increased to 50 or above. This happened at the uptrend alert area. Lastly, it can be seen as the price and the RSI were moving in the opposite direction. As the RSI falls to the oversold which is less than 30 and then it increases back above 30 which has been shown on the green text box indicating a buy signal. An investor can buy the stock at a price of RM1.66 in March 2022. Thus, the trendline of Top Glove Corporation suggested buying the stock during the line crosses the oversold line which is less than 30. Diagram 4 : Relative Strength Index Report Date: 08/ 07 / 2022 (MYR) Target Price : 2.805 Entry Price : RM 1.030 Stop Loss: RM 0.805
Analyst: Iffah Izzati Binti Muhamad Sulung @ Malik TOP GLOVE CORPORATION BHD Health Care (MYR) Target Price : 2.805 Entry Price : RM 1.030 Stop Loss: RM 0.805 2.4 Price Forecast (short term perspective) Based on the graph above, we can see that the price was a downtrend. It reached its peak price at RM3.44 in December 2022. After that, the price was only around RM2.00 to RM0.90. As the price was in a downtrend situation, investors will predict the price will decrease due to weak market performance. It can be see as the volume are high but the price are low. The RSI also indicate the RSI line is about to go down. When the RSI move below 50, it shows there is more sellers than buyers which will bring the price down. Thus, from 06 July, 2022, the price forecast pegged the price will decrease starting on 9 July 2022. Besides, on the MACD, we can see that the MACD histogram are above the base line which show many seller then will bring the price decrease. Therefore, the price forecast is it will continue decrease as many sellers than buyers after the entry price. Report Date: 08/ 07 / 2022 Diagram 5 : Price Forecast
Analyst: Iffah Izzati Binti Muhamad Sulung @ Malik TOP GLOVE CORPORATION BHD Health Care 2.5 Overall Sentiment The overall sentiment is all of the indicators shows a buy signal in June. The most accurate, easier, and useful indicator based on my opinion is moving average convergence divergence. It is because the line is easy to see the price movement as well as the histogram. Thus, based on the MACD, investor can enter the stock at RM 1.085 on June 21, 2022. Then, pegged the target price above the entry price which is at RM2.20 which will enable to obtain profit of RM1.115 for 1 quantity. Lastly, we need to set the stop loss to avoid losses occurs, the stop loss is RM1.03. Thus, we the price hits the stop loss level, investor will automatically exit the trade. Report Date: 08/ 07 / 2022 (MYR) Target Price : 2.805 Entry Price : RM 1.030 Stop Loss: RM 0.805
Analyst: Iffah Izzati Binti Muhamad Sulung @ Malik TOP GLOVE CORPORATION BHD Health Care References Report Date: 08/ 07 / 2022 1.Day Trade The World, THE 6 BEST ENTRY AND EXIT INDICATORS FOR DAY TRADERS from https://www.daytradetheworld.com/trading-blog/best-entry-and-exit-indicators. 2. Lucas Downey (2021) Pattern , Retrieved May 30, 2021 from https://www.investopedia.com/terms/p/pattern.asp 3. Cory Mitchell (2022), Hammer Candlestick Retrieved March 02, 2022 from https://www.investopedia.com/terms/h/hammer.asp 4. Investor (2010-2022), TOP GLOVE CORPORATION BHD from https://klse.i3investor.com/web/stock/financial-quarter/7113 5. Bursa Malaysia Top Glove from https://www.bursamalaysia.com/market_information/announcements/company_announceme nt/announcement_details?ann_id=3208629 6. Ahmad Fauzi, Price and Chart patterns from https://heyzine.com/flipbook/b65a6078a8.html 7. Dan Blystone (2022) Use the RSI Indicator to See If a Stock Is Overbought or Oversold Retrieved June 19, 2022 from https://www.investopedia.com/articles/activetrading/042114/overbought-or-oversold-use-relative-strength-index-find-out.asp (MYR) Target Price : 2.805 Entry Price : RM 1.030 Stop Loss: RM 0.805