KESM (Trading Buy, TP @ RM11.34). KESM has bucked four straight days of market decline, finishing 35.0 sen up (4.0%) to RM9.15 yesterday. Recall that earlier last month, we recommended that investors should consider taking profit on KESM when the share price was having trouble getting past the RM10.00 key resistance (report dated 21st Oct). Indeed, the share price subsequently retreated to as low as RM8.53 before showing signs of bottoming out. Yesterday, KESM offered yet another fresh buy-signal after it confirmed a “Hammer Reversal” candlestick which coincides with the uptrend line. With this, we believe that KESM is poised for a near-term rebound from here. Overhead resistances include the aforementioned RM10.00 (R1) level and RM11.40 (R2) further up. Downside support is located at RM8.53 (S1) and RM8.20 (S2) below.

SENDAI (Not Rated). SENDAI rose 4.5 sen (8.57%) on stronger trading volume to break out from its multi-month resistance-turnedsupport level of RM0.54 (S1), closing higher at RM0.57. With a ‘golden cross’ formed across all its key moving averages, the underlying outlook is looking positive from here. Bullish convergence displayed by the MACD histogram above the zero-line, as well as up-trending RSI and Stochastic that reflects the increased bull momentum on the stock, are supporting the positive-bias outlook ahead. Near-term overhead resistance level could be found at RM0.58 (R1) followed by RM0.63 (R2) next. While the technical picture looks rosy at this point, we do not discount the possibility of a slight retracement in the near-term to neutralise the overbought condition. Thus, interested investors could look for an entry point around the RM0.54 (S1) level, while keeping in mind of the next support level at RM0.50 (S2).

Source: Kenanga Research - 11 Nov 2016