· UEMS (Trading Buy, TP @ RM1.37). UEMS has been trending along its upward regression channel, as it looks to stage another rebound play off its -2SD regression level after breaking out from a ‘Flag’ chart pattern. Key momentum indicators are suggesting that the property developer could be poised to retest its trend channel resistance level of RM1.37 (R2) in the near-term, underpinned by the bullish divergence of the MACD, as well as the upwards trending RSI and Stochastic. Despite key indicators (RSI and Stochastic) being relatively near their respective overbought territory, we deem this as acceptable given that they had been hovering around this level for over the past 1.5 months. However, should there be lack of follow-through buying interest, we do not discount that the share price could consolidate towards its RM1.15 support (S1).

· OWG (Not Rated). OWG garnered investor’s interest to stage a gap-up and breakout from its ‘Triangle’ chart pattern to settle at RM2.47 (+7.39%), after consolidating over the past few months. On the back of the stronger trading volume, the sudden surge in Stochastic and uptick in RSI reinforces the view that the share price could look to rally further to retest its previous high level of RM2.99 (R2). Nevertheless, we do not discount the possibility that the share price could look to retrace post its strong surge to cover the gap-up. We believe a swift recapture of the RM2.52 (R1) level would reaffirm its uptrend trajectory. 

Source: Kenanga Research - 15 Oct 2015