PESTECH’s share price has been on a roll since the company released its FY12 earnings on the 22nd of February. Within this two-month timeframe, the share had rallied more than 80% to yesterday’s closing price of RM1.95. Even so, we believe that the share price has further distance to go. PESTECH broke out of a short term consolidation phase (RM1.76-RM1.80) last week on increased volume, and the share price has now confirmed a “Bullish Flag” pattern on the daily chart. The technical indicators have also inched deeper into bullish territory, and we reckon that the share price could potentially advance towards the RM2.18 “Flagpole” target price in the coming weeks (target 3 bids below this level). In the meantime, support remains at the RM1.76 - RM1.80 former congestion zone, and traders who are looking to buy into the stock should place a stop-loss at RM1.73.

 

Source: Kenanga