FARLIM is currently a cash-rich company after it disposed off its Penang lands for RM112.5m. Yesterday, FARLIM rose 5 sen (+8.27%) to close at RM0.72 with a “Marubozu” candlestick pattern. Despite a lack of high trading volume at this juncture, FARLIM’s technical chart remains attractive. The stock has been stuck in a bullish trend channel for the past seven months between RM0.40-RM0.75, and we believe that now is a good timing to buy into the stock after it breaks out from the short-term consolidation phase. The bullish outlook was further reinforced with a MACD-Signal line crossover, indicating strong buying support at the current level. We expect follow-through buying to persist over the next few days, carrying the share price towards its channel resistance level of RM0.85.

 

Source: Kenanga