Over the past three months, SCOMI had retested the 36 sen resistance level on multiple occasions. However, it wasn’t until yesterday that the share price finally punched through this crucial level to signal a bullish trend reversal. At 38.5 sen, the share price was up by 2.5 sen for the day. Indicator-wise, the MACD has just crossed above the Signal-line (this reflects a pick-up in bullish momentum), while the 14-day Stochastic and RSI are also on a bullish incline. As such, we reckon that the technical picture is firmly supportive of a move higher, and SCOMI could potentially extend its gains towards October’s high of 44.5 sen next. Downside also

appears limited, though a stop-loss just below the 36 sen resistance-turned-support should still be placed.

 

Source: Kenanga