· SCGM (Trading Buy, TP: RM3.00). Yesterday, SCGM rose 13.0 sen or 5.10% to settle at an all-time high level of RM2.69 on strong buying volume following the break-out from its four-month resistance-turned-support of RM2.60. Recall that we issued a “Trading Buy” call on the stock on 14 August premised on its share price’s weakness and oversold position with a TP of RM2.62. Despite hitting our target price, the technicals continue to showcase a favourable outlook following the break up from its “Ascending Triangle” pattern suggesting a near-term bullish outlook. This is also underpinned by key indicators such as stochastic indicator and RSI heading up. Thus, we decided to revise our target price further to our objective measurement of RM3.00 with a stop-loss placed at RM2.50.

· TOMYPAK (Not Rated). After achieving an all-time high of RM2.39, TOMYPAK took a few days to digest the gains and forming a ‘Flag’ chart pattern in the process. The share price has just barely broken out from the aforesaid chart pattern recently, but closed at RM2.32 with a ‘Doji’ candlestick yesterday. Nevertheless, we deem its technical picture to be neutral underpinned by its low trading volume and flattish momentum indicators. Should the share price manage to garner follow-through buying interest to swiftly take over the RM2.40 (R1) level, we reckon the share price could trend towards our measurement objective of RM2.60 (R2). 

Source: Kenanga Research - 23 Oct 2015