Last Thursday, Alam announced that it has secured a RM69.2m contract to provide a workboat to a local oil and gas company. The news was a boon for the stock, and the share price consequently rose 17% over the course of two days to settle at 62.5 sen on Monday. Having previously taken out a crucial resistance level, we believe that Alam has significant upside potential from a technical perspective. The SMAs have completed a golden crossover and the share price appears to have formed a medium term bottom at 49 sen. That said, the run-up in recent days have brought the 14-day Stochastics and RSI indicators to overbought levels. The 'Spinning Top' candlestick formed on Monday also indicates that the share price may consolidate in the near term which  in our view should present investors with a renewed buying opportunity. Investors should then buy on weakness with the immediate targets of 68 sen and 78 sen.

Source: Kenanga