KCB has had a very impressive run over the years. But fundamentals state that demand must meet supply at equilibrium. After its long rally, price is finally starting to ‘balance out’ in the chart as we saw price break out of the triangular wedge and did a huge sell off to the downside as it tries to reach equilibrium (green zone). As price comes down, it will also take out the consolidation zone highlighted in red.
This won’t be a quick process. I anticipate this to go on for the subsequent months. It could go for as low as 5Ksh if the sell off persists. This is also catalyses by the prevailing market conditions which isn’t favoring any buys for now, the market sentiment has shifter to a bear market as it is already evident in the chart.
Considering the company has a solid asset base and financial muscle to manage its operations, coupled with its expansion outside Kenya, it still has a chance to regain its lost glory but first, we need to consider the matter in hand, which is market balancing out before we think about buying and holding in the long term.
This won’t be a quick process. I anticipate this to go on for the subsequent months. It could go for as low as 5Ksh if the sell off persists. This is also catalyses by the prevailing market conditions which isn’t favoring any buys for now, the market sentiment has shifter to a bear market as it is already evident in the chart.
Considering the company has a solid asset base and financial muscle to manage its operations, coupled with its expansion outside Kenya, it still has a chance to regain its lost glory but first, we need to consider the matter in hand, which is market balancing out before we think about buying and holding in the long term.