The recent selldown in OCBC seems to be hard done. It all started when the news of a potential acquisition is in the cards.
We do think this stock is a mid to long term play as we believe there is a chance STI might have seen a bottom at 2950. If we are wrong, we think that there is limited downside left.
Whenever we think STI is cheap, I am always looking at the banks as a mid to long term play.
OCBC is the most selldown and of course it should be one of the most watched then. Speculators are always more short sighted in merger and acquisitions. And we think the expectation of the acquisition has already been priced in.
$9 is quite a good support, and it does look strong these few days.
A slightly longer duration play for me...
Target 1: $9.67
Target 2: $9.95
Stop loss: $8.95