· KAREX (Not Rated). Recently, industry reports highlighted that KAREX is likely to post better results due to gains from operating efficiency improvements, favourable product mix with higher margins, stronger US dollar and brighter prospects from its recent acquisition of Medical Latex Dua Sdn Bhd. Chart-wise, its share price broke out from a descending triangle chart pattern weeks ago and was riding on an upward trend after a short consolidation phase. Indicators displayed mixed signals, with MACD traded above the positive Signal line and RSI hooking up strongly, despite Stochastic Indicator has made a sharp entry into the overbought zone. Should the buying momentum accelerate further on its bullish prospects, we reckon the share price may rally towards its immediate resistance level of RM3.66 (R1). Meanwhile, the immediate support level is placed at RM3.44 (S1).

· EUPE (Not Rated). EUPE, a leading property developer in Kedah recently attracted investors’ interest on its venture into the Klang Valley’s vicinity. The group is poised to launch the first phase of its Bangsar South project this month, with the remaining two phases by mid-2016. On the back strong trading volume, EUPE has put a halt to its downtrend trading pattern by staging a breakout from its multi-month downtrend resistance line. The underlying outlook is promising as the share price is trading above all its SMA levels (which are also hooking upwards). Despite the overbought situation shown in the Stochastic, the uptick in RSI is implying stronger buying momentum. Should follow-through buying interest remain, we reckon that the share price could look to retest its immediate resistance of RM0.93 (R1) and RM1.00 (R2) next.

Source: Kenanga Research - 3 Nov 2015