GADANG (Trading Buy, TP: RM2.67). GADANG has been on a medium term uptrend with the share price rallying from a low of RM1.13 in August to RM2.08 yesterday. Strong earnings growth aside, wire news had also reported that the company is confident its construction order book could surpass the RM1b mark for FY16. Of note, GADANG’s share price broke above its short-term resistance level yesterday and is now poised to commence an accelerated upswing. Increased volume and a bullish signal by the MACD are also indicative of a move higher. From here, traders may consider buying into the stock, with a price objective of RM2.67 (3 sen below measurement objective), Meanwhile, a conservative stop-loss should also be placed just below the uptrend support at RM1.85 (3 sen below RM1.88 support/20-day SMA). Expect resistance levels to be present at RM2.35 (R1) and RM2.75 (R2) and support levels at RM2.00 (S1) and RM1.88 (S2).

EDUSPEC (Not Rated). EDUSPEC has been on a short-term uptrend reversal pattern, after staging a rebound play on late-August. The share price surged 2.0 sen to rebound from its 50-day SMA level on the back of high trading volume to close at RM0.33 yesterday. We observe that the 50-day SMA level has acted as a strong support/resistance indicator historically (circled on Figure 4), while an uptick in Stochastic has also implies that a potential rebound play is on the cards. Shall there be follow through buying interest, we expect the share price to ride on the bullish momentum to retest its immediate resistance level of RM0.36 (R1) and possibly RM0.40 (R2) next. Meanwhile, downside is supported at RM0.30 (S1) and RM0.27 (S2). 

Source: Kenanga Research - 10 Dec 2015