Good-buy stock (2011-04-13 Maanshan Irom&Steel analysis)

Hang Seng Index was down 1.34% yesterday, falling below 24,000. It looks like it is moving towards the support level I mentioned at around 23,700. If the index reaches this point, there would probably be a large buying-force and we can seize this opportunity to hold some stocks.

Yesterday I discovered a good stock that worths holding. Let's see.



The above is the daily chart of Maanshan Iron & Steel Co. Ltd. (0323.HK). Obviously, its major functionality is to manufacture and sell iron & steel products.

Despite of HSI's great slump, this stock was still able to gain a bit yesterday. It shows that the buying-power was definitely strong enough to resist the bearish power.

Technically, we can see that the stock price has just broken out the pennant. This pennant was formed in past 4 months and is definitely a strong one. Breaking-out of it means a lot to the stock.

Therefore, I am quite optimistic with 0323.HK. Regarding the fundamentals, China's infrastructure development is absolutely a major wealth generation for Maanshan Iron & Steel; but another source of income could probably be from Japan as they have to buy the two materials for rebuilding the cities collapsed during earthquakes.

Back to technical analysis, the next resistant level will be at 4.59, but I think it will break it and reach around 5.0. This is definitely a good-buy stock.