MAXIS BERHAD (Technical Buy)

• Maxis Berhad (MAXIS) closed at RM3.75 yesterday, registering a gain of 2.46%, signalling a potential recovery from its recent low of RM3.62. The stock is currently testing its 50-day SMA, which has turned from resistance into support at RM3.74. A successful hold above this level, followed by a breakout above RM3.77, could point toward a stronger uptrend.
• From a technical standpoint, the stochastic oscillator remains low at 13.16, still in oversold territory but showing upward momentum, indicating increasing buying interest. The Tom Demark Pressure Ratio (TDPR) remains stable at 49.95, suggesting that selling pressure is easing. The RSI is also trending higher at 48.43, edging closer to neutral territory, which signals the potential for continued upward movement.
• Key levels to watch include resistance at RM3.77 (aligned with the 5-day SMA), and a critical resistance at RM4.00, which serves as a psychological level. On the downside, strong support is positioned at RM3.63, with an additional cushion at RM3.50, both providing solid protection against potential dips.
• For traders looking to capitalize on this breakout opportunity, accumulating positions near current levels, or close to the 5-day SMA around RM3.73, could present a strategic entry point. A take-profit target at RM3.98 offers an upside potential of approximately 6.7%, while a stop-loss set at RM3.60 limits downside risk to around 3.5%. This setup presents a favorable risk- reward profile for short-term traders looking to ride the potential uptrend in MAXIS.

Source: Kenanga Research - 16 Oct 2024