ASB (Not Rated). Yesterday, ASB’s share price rose 2.5 sen (14.7%) to RM0.195 on high trading volume of 47.5m shares. Historically an illiquid stock, ASB has seen rising trading interest since the release of its FY16 report card in February (FY16 Net Profit of RM8.6m compared to FY15’s net loss of RM10.8m). Since then, the share price had rallied to as high as RM0.18, before entering into a meaningful consolidation phase back towards RM0.155. Nevertheless, yesterday’s bullish move marks a breakout of a “Flag formation” to signal a resumption of its prior uptrend after a brief 3-week pause. Concurrently, the MACD has also crossed above its Signal line to reflect a shift in momentum from bearish to bullish. Hence, we expect further gains ahead over the coming weeks towards RM0.205 (R1), and RM0.235 (R1) and finally the “Flagpole” measurement objective of RM0.24. Downside support is located at RM0.165 (S1) although a move below RM0.155 (S2) would be highly negative for the stock.

EAH (Not Rated). EAH rose 1.0 sen (11.76%) to stage a breakout from its 1-year resistance-turned-support line to close at RM0.095 yesterday. The primary trend of the stock is looking positive, as the share price is currently trending above all its key SMA. MACD is also setting a higher high to lay a hand on the positive trend outlook. Nonetheless, we observe that the daily RSI has been lurking at its overbought levels for the past few weeks. Thus, we do not discount the possibility of any healthy pullback in the immediate term to neutralise its overbought condition. Buy-on-weakness level at the RM0.085 (S1) will be a more compelling entry level, while any decline below the RM0.075 (S2) would trigger a sell signal. Overhead resistance is capped at RM0.10 (R1) followed by RM0.125 (R2).

Source: Kenanga Research - 11 Apr 2017