PMETAL (Trading Buy, TP @ RM4.97). Yesterday, PMETAL has confirmed a uptrend resumption after surging 6.0 sen (1.37%) above the RM4.33/RM4.44 level to mark a fresh closing high at RM4.45. In tandem with the increasing trading volume, the bullish bias outlook is well supported by the bullish convergence seen by the MACD histogram as well as uptrending RSI indicator. The resurgence of buying interest could see the stock resume its prior uptrend towards RM4.53 (R1) and possibly our target objective of RM4.97 (3 bids below the psychological RM5.00 (R2) level) in the near-to-mid term. On the downside, the stock could look to consolidate further shall it fails to takeout the immediate R1 level in the near term. Downside support could be found at RM4.33 (S1) and further south at RM4.20 (S2). A protective stop-loss is placed at RM4.30 (3 bids below S1) to negate any further loses from a technical breack down.

KESM (Trading Buy, TP @ RM9.46). KESM surged to a fresh all-time high yesterday, with a 52 sen (+6.6%) gain to RM8.45. Chart-wise, the share price began its uptrend in June and subsequently rose to a high of RM8.19 within a short period 3 months before consolidating sideways. Nevertheless, renewed buying interest emerged yesterday, resulting in a “Pennant” formation breakout. This indicates that KESM is poised to resume its bullish run after a pause for breath. The MACD has also crossed above its Signal line to reflect a shift to bullish momentum. From here, expect the share price to be positively biased with a “Flagpole” measurement objective of RM9.52. Resistance levels to look out for are RM9.17 (R1) and RM9.78 (R2) while support is envisaged at RM7.80-RM8.00 (S1) and RM7.50 (S2)

Source: Kenanga Research - 13 Oct 2016