SERSOL, a manufacturer and trader of industrial coating products had recently attracted investors’ interest as seen from its above-average (20-day average) trading volume. The share price gapped up from its strong support level of RM0.28 (S2) to break above its 20-day SMA level, hence putting an end to its recent downtrend. Key indicators are also supportive of the reversal trend, as the Stochastic indicator has surfaced strongly from its oversold territory while RSI indicator is trending up bullishly. With all the positive signs, we are assigning a Trading Buy’ call on the stock with expectations that follow-through buying interest will emerge to rally the share price towards its 50-day SMA level (which coincides with its mean Bollinger-band level) at RM0.34 (R2) in the near-term.
Source: Kenanga Research - 5 Jun 2015
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