SUPERMX (Trading Buy, TP: RM4.17). As per our strategy to focus more on export-oriented counters and beneficiaries of the stronger greenback, we are highlighting SUPERMX, which is one of the hot stocks among the rubber sector yesterday where it surged 26.0 sen (8.2%) to close at RM3.45 on the back of strong trading volume. During the second half of yesterday’s trading session, the share price garnered strong investors interest as it staged a technical breakout from its ‘Flag’ chart pattern. RSI indicator has shown a strong uptick to suggest that buying momentum has piled up, while MACD is staging a bullish convergence to reinforce the bullish picture. Thus, we are placing a trading buy call on the stock with targets set 3.0 sen below our ‘Flagpole’ measurement objective level of RM4.20 (R2) at RM4.17. Meanwhile, we are placing a strict stop-loss at the RM3.07 (3.0 sen below the recent low level of RM3.10).

SEACERA (Trading Buy, TP: RM1.32). Yesterday, ceramic tile maker SEACERA saw its share price rally 11.0 sen (10.7%) to RM1.14 on high trading volume. The share price began its uptrend in early December after it was reported that the company would be submitting its tender for the Menara Warisan Merdeka project. Following a brief pause, the share price is poised to resume its uptrend with yesterday’s breakout of a “Bullish Flag” formation. From here, we expect follow-through buying with an upside target of RM1.32 (3.0 sen below the “Flagpole” measurement objective). Traders may consider buying now, with a stop-loss at RM0.97 (3.0 sen below the RM1.00 support (S1)). Immediate resistance levels to look out for are RM1.18 (R1) and RM1.42 (R2) while support levels are RM1.00 (S1) and RM0.86 (S2).

CANONE (Not Rated). For the day, CANONE’s share price surged 29.0 sen (6.3%) to close at a fresh all-time-high of RM4.88. The share price had earlier broke out of a “Bullish Pennant” chart pattern (23 Dec 2015) to signal a continuation of its prior uptrend. However, it wasn’t until yesterday that the November high of RM4.70 was penetrated in a decisive manner. Taken in tandem with the buy signal from the MACD-Signal line, we expect follow-through buying to continue in the coming weeks. Traders may consider buying now with an upside target of RM5.94 (3 bids below the measurement objective). At the same time, losses should be contained with a stop-loss at RM4.17 (3 bids below Pennant support). Immediate resistance levels to look out for are RM5.34 (R1) and RM6.00 (R2) while support levels are RM4.50 (S1) and RM4.20 (S2).

Source: Kenanga Research - 7 Jan 2016