· PADINI (Trading Buy, TP: RM2.16). PADINI’s share price has been consolidating for over the past week to form a ‘Flag’ chart pattern after reaching a high of RM1.90 (R1). Yesterday, the share price has surged 6 sen (+3.3%) to break out from its ‘Flag’ chart pattern on the back of strong trading volume. The underlying near-term outlook is positive as it currently trades above its 20-day SMA level. RSI indicator has also shown an uptick to imply that buying momentum is piling up. Hence we reckon that the share price could possibly rally on follow through buying interest towards our ‘Flagpole’ measurement objective level of RM2.16 in the near-term. Resistance levels are capped at RM1.90 (R1) and RM2.16 (R2), while support is marked at RM1.80 (S1) and RM1.63 (S2).

· VS (Not Rated). VS have recently garnered investors’ interest after the company reported a strong earnings report two days ago. On the back of a spike in trading volume, the share price rose 4 sen (+2.55%) to stage a gap up to settle at RM1.61. Currently, the share price is poised to retest its immediate resistance level of RM1.62 (R1). Nevertheless, the rolling over of Stochastic indicator is suggesting that the aforesaid resistance level could be hard to break. Shall the share price fail to stage a breakout from the RM1.62 (R1) level convincingly, we anticipate that the share price could be dragged into a consolidation phase. Hence we advocate interested investors to look out for a convincing technical breakout from the RM1.62 (R1) level before entering the stock.

Source: Kenanga Research - 17 Dec 2015