VIS (Trading Buy, TP @ RM0.77). VIS surged 11.5 sen (23.47%) to stage a technical breakout from its ‘Ascending Triangle’ chart pattern to close at RM0.605 yesterday. In tandem with the strong trading volume, the MACD is looking to stage a bullish crossover from its signal line. The hook up by RSI is also signalling a positive outlook for the stock in the immediate term. From here, VIS could look to gear higher up towards RM0.64 (R1) and possibly our target price objective of RM0.77 (3 bids below the RM0.785 (R2) level) in the near-to-mid term based on Fibonnaci measurement. Meanwhile, we do not discount possibility of VIS undergoing a healthy pullback in the near-term given the overdone surge and deep overbought Stochastic display, where any pullback could be a good time to accumulate the stock. Support levels could be found at RM0.50 (S1) followed by RM0.43 (S2), while our stop-loss is placed 3 bids below the S1 level at RM0.475.

SALUTE (Not Rated) SALUTE has undergone a commendable rally over the past 2 weeks to stage multi breakouts from a cluster of overhead resistances. Yesterday. SALUTE rose another 5.0 sen (3.33%) to close at a fresh record high level of RM1.55 on strong trading volume. The hooking up of all its SMAs are suggesting the primary uptrend of the share. MACD line is also displaying a strong bullish convergence away from its zero-line to lay a hand on the positive near-to-mid-term outlook. Nonetheless, we observe that the recent rally could be overdone given the deep overbought RSI and Stochastic. Thus, we do not discount the possibility of a healthy share price retracement. Any retracement towards the RM1.50/1.45 (S1) would be a good level to accumulate. Key overhead resistances are seen at RM1.60 (R1) and RM1.70 (R2) next.

Source: Kenanga Research - 14 Feb 2017