PMETAL (Trading Buy, TP: RM3.49, SL: RM2.97). PMETAL has been undergoing a consolidation phase after reaching a high level of RM3.20 back in early-May. Yesterday, the share price surged 14.0 sen (4.68%) to stage a breakout away from its downtrend resistance line to close at RM3.13 on strong trading volume. MACD histogram showed signs of resurgence just above its zero-line, while strong uptick in RSI and Stochastic are indicating that buying momentum is piling up. With the positive technical outlook, we reckon it could look to retest its immediate resistance of RM3.20 (R1) before attempting RM3.52 (R2) next in the near-mid-term. We advocate interested investors to place a protective stop-loss 3 bids below its immediate support level of RM3.00 (S1) at RM2.97 with a target objective of RM3.49 (3 bids below the R2 level). Meanwhile, the next level of support is located at RM2.83 (S2).

BTECH (Not Rated). BTECH rose to a five-year high yesterday with a 5.0 sen (14.9%) surge to RM0.385. Trading volume expanded to six times the 30-day average at 5.9m shares. Chart-wise, BTECH has broken out of a “Rectangle” pattern. This indicates that the share price is poised for a strong upswing after being stuck within the RM0.22-RM0.35 trading range for more than a year. This follows the earlier buy signal by the MACD (last week) which had broken out above the trendline/zero-line to reflect a sudden shift in momentum from bearish to bullish. From here, expect a further move to RM0.41 (R1) before completing the “Rectangle” measurement objective at RM0.48 (R2). Strong support is envisaged at RM0.35 (S1) where traders may look to buy on weakness. The technical picture is deemed bullish until and unless the RM0.20/0. 22 (S2) support is violated in a decisive manner.

Source: Kenanga Research - 9 Jun 2016