HEVEA (Not Rated). HEVEA’s share price rose for the fourth straight day, yesterday finishing up by 6.0 sen (4.2%) at RM1.49. Chart-wise, the share price has just broken out of a “Double-Bottom” pattern, which signals the end of a four month downtrend. Other tell-tale signs include the MACD which has also been showing signs of bullish convergence. Hence, we expect further gains ahead towards RM1.58 (R1) and finally the measurement objective of RM1.62 (R2) beyond. Any weakness back to the RM1.45 (S1) trigger-line can be viewed as an opportunity to buy-on-weakness, failing which, the 100-day SMA at RM1.40 (S2) should also offer a solid level of support.

MIECO (Not Rated). Similarly, chip-board maker MIECO saw its share price climbing 5.5 sen (4.2%) to RM0.97 on elevated trading volume. Last year, the share price kicked-off a strong uptrend in May which saw investors tripling their money within a year. Nevertheless, the share price subsequently entered into a three-month sideways hover until this week. Note that yesterday’s gain signals a consolidation breakout, accompanied by the momentum indicators which have also hooked upwards. From here, we expect a re-test of the RM1.00 (R1) psychological level, before a move to retest April’s RM1.07 (R2) high. Downside support appears solid at RM0.88 (S1), although a break below the next resistance of RM0.84 (S2) would be a huge negative.

Source: Kenanga Research - 5 Jul 2017