· PESTECH (Take Profit @ RM5.86). To recall, we placed a “Trading Buy” call on PESTECH on 3 July 2015, where the share price has surged above the downtrend line. PESTECH registered an all-time high and closed at RM5.86 (+3.17%) yesterday. Chart-wise, the share price gapped up and formed a white “Marubozu” candlestick in yesterday trade, suggesting the strong buying momentum. However, both Stochastics and RSI are in the overbought territory, suggesting a potential short-term consolidation. As the share price had met our target price, we are taking profit on PESTECH at RM5.86 and may re-visit this stock should the technical picture turns compelling again.

· PRESBHD (NR). A black “Marubozu” candlestick has appeared in the daily technical chart, indicating that sellers controlled yesterday’s trade. A ‘Dead Cross’ resulting from the 20-SMA breaking below the 100-SMA, reaffirms the bearish view. Moreover, Stochastics is in the overbought territory, suggesting that a near-term pullback is imminent. Nevertheless, we advocate investors to keep an eye on PRESBHD. Investors may look into accumulate this stock, should the share price consolidate towards the recent low key support level of RM2.20, while immediate resistance is capped at RM2.60 (R1).

· HEVEA (NR) is retreating after it hit its all-time high of RM1.17 (R1). The underlying trend remains up, as the share price is supported by all three SMAs. However, key momentum indicators such as Stochastics and RSI are in the overbought territory, indicating near-term consolidation is possible. Selling pressure was strong yesterday, which is shown by the black “Marubozu” in the daily technical chart. Having said that, we view that RM1.00 (S1) support level could be a good entry price to lock in position. Thus, investors interested in HEVEA could buy into this stock should the share price consolidate towards the abovementioned support level. 

Source: Kenanga Research - 28 Jul 2015