SYSTECH has formed a “Descending Triangle” chart pattern followed a consolidation mode over the past two months. We notice that the stock has started garnering investors' interest as depicted by the increasing trading volume. Indicator-wise, the Stochastic indicator has emerged from its oversold territory to suggest a potential breakout. RSI indicator is also showing signs of upwards trend. The current share price could be a good entry point, underpinned by the strong support formed over the past two months. Should there be a high volume (c.2-3x the 15-day average volume) traded in the next few days, it would trigger a technical bullish breakout, and thus could lead the share price resuming its previous uptrend. Hence, we are issuing a “Trading Buy” call on the stock with TP of RM0.39 (R1) with a strict stop-loss set at RM0.30 (S1).

Source: Kenanga