Capitaland Ascendas REIT Faces Bearish Reversal: A Technical Sell Recommendation

Date of Report
October 15, 2024

Broker Name
CGS International Securities

Company Overview

CapitaLand Ascendas REIT (CLAR) is an industrial real estate investment trust. The Trust invests in various types of properties, including:

• Business and science park properties
• Integrated development, amenities, and retail (IDAR) properties
• High-specifications industrial properties and data centers
• Light industrial and flatted factories
• Logistics and distribution centers

These diverse property investments give CLAR a significant footprint across various segments of the industrial real estate market.

Technical Analysis and Market Performance

As of the report’s publication on October 15, 2024, CapitaLand Ascendas REIT is facing bearish pressure. A sell recommendation was issued due to the following key technical signals:

1. Price Action: The stock has broken below the support turned resistance level at S$2.89, confirming a rounding top bearish reversal pattern.
2. Ichimoku Indicator: Two out of three bearish death crosses were observed, indicating a continuation of downward momentum.
3. MACD/Signal Line: A crossover is likely to occur at the top, with the histogram showing negative values.
4. Stochastic Oscillator: An overbought crossover occurred after the indicator fell below the 80-line, further supporting the bearish outlook.
5. Rate of Change (ROC): The 23-period ROC has dipped below the zero line, another bearish indicator.

Recommended Trading Strategy

The broker recommends initiating a sell position based on the overbought momentum and bearish price action. The stock has shown signs of a larger degree corrective structure, and the following levels are highlighted for reference:

• Entry Prices:

  • S$2.78
  • S$2.88
  • S$2.94

• Support Levels:

  • Support 1: S$2.73
  • Support 2: S$2.56

• Resistance Levels:

  • Resistance 1: S$2.89
  • Resistance 2: S$2.99

• Target Prices:

  • Target 1: S$2.62
  • Target 2: S$2.53
  • Target 3: S$2.35
  • Target 4: S$2.30

Analyst Contact Information

The report’s analysis was conducted by:

• Analyst: Chua Wei Ren, CMT
• Contact:
  • Phone: +65 6210 8612
  • Email: weiren.chua@cgsi.com

Conclusion

Based on the technical analysis and indicators mentioned above, CapitaLand Ascendas REIT is expected to face further bearish momentum. Investors are advised to follow the sell recommendation with the outlined entry, support, and target price levels.