PELIKAN (Not Rated). PELIKAN surged 5.0 sen (5.59%) to RM0.945 yesterday to stage a rebound play from its recent correction. Upticks in RSI and Stochastic, with the latter emerging from its oversold position, are indicating that momentum has started to pick up. Nonetheless, with the lower-than-expected trading volume observed, the rebound play could rather be short-lived. If there is strong volume follow-through buying today, the stock could set a sight to retest its multi-month high level of RM1.06 (R1) and possibly RM1.14 (R2) if the R1 level is breached. On the flip side, the stock could potentially experience a ‘dead cat bounce’ if there is absence of convincing follow-through buying, resulting in potential consolidation play with supports envisaged at RM0.93 (S1) and RM0.88 (S2).

FAJAR (Not Rated). FAJAR has been rallying for two straight days on high volume, following Thursday’s AGM. Yesterday alone, the share price was up 3.0 sen (5.6%) to RM0.565. On the daily chart, the share price punched through its downtrend channel last week, and this was promptly followed by yesterday’s crucial breakout above the 100-day SMA (a feat last seen in Sep 2015 before a 48%-odd rally). The MACD has also crossed above the zero-line to reflect a shift in momentum from bearish to bullish. With these, we expect FAJAR to be biased to the upside from here. Immediate resistances to look out for are RM0.60 (R1) and RM0.62/0.64 (R2) while downside support levels are RM0.53 (S1) and RM0.50 (S2)

Source: Kenanga Research - 1 Nov 2016