VS (Trading Buy, TP: RM1.65, SL: RM1.45). VS’s share price rose 3 sen (2.0%) yesterday to a 12-month high of RM1.51. With the bullish move, VS has broken an “Ascending Triangle” pattern, depicted by a horizontal upper resistance (RM1.48) and a lower ascending trend line. This bullish pattern signals that the share price is poised for an uptrend continuation after facing strong resistance at the RM1.48 level. From here, we expect further gains towards RM1.56 (R1) and finally the “Ascending Triangle” measurement objective of RM1.68 (R2). Aim to take profit 3 bids below R2 at RM1.65, while placing a strict stop-loss level just below the RM1.48 support at RM1.45).

GTRONIC (Not Rated). GTRONIC rose 12.0 sen (3.03%) to stage a breakout from its resistance-turned-support level of RM3.97 to close at RM4.08. Yesterday’s price action has confirmed a ‘rounding bottom’ chart pattern on the back of strong trading volume, while the bullish convergence display by MACD line and uptick in daily RSI are supportive of the positive-bias outlook. Shall there be follow through buying, GTRONIC could set sights at RM4.40 (R1) and RM4.60 (R2) next. Nonetheless, with the deep overbought condition showcased by both RSI and Stochastic, we do not discount the possibilities of a consolidation pullback in the immediate term to neutralise its overbought condition. Downside levels are capped at RM3.97 (S1) followed by RM3.50 (S2) further south

Source: Kenanga Research - 27 Jan 2017