Back in November 2013, ECS announced a set of disappointing 9M13 results due to unfavourable foreign exchange rates. This triggered analysts' downgrades, which also drove the stock from its November high of RM1.40 to RM1.10 as recent as early this week. However, ECS caught our attention yesterday, when it rebounded from its year-long down trending channel. It surged by 6 sen to RM1.18 and appears poised to commence a major up-cycle. Based on the chart pattern, we believe that ECS could potentially extend its gains towards RM1.45. We suggest that traders look to take profit 3 bids below this targeted level at RM1.42. Meanwhile, a stop-loss of RM1.07 should also be employed as a safeguard.

 

Source: Kenanga