CRESCENDO CORPORATION BHD (Technical Buy)

• Crescendo Corporation Bhd (CRESNDO) closed at RM1.29, up by 10.3% yesterday, marking a strong rebound from recent lows. The stock managed to break out of its consolidation phase and cross above its key support level of 200-day SMA at RM1.22, indicating a potential bullish trend reversal on the horizon.
• Technically, the stochastic oscillator is trending upward from oversold territory at 16.33, signalling renewed buying interest. The RSI is increasing at 51.37, hinting at a neutral-to-positive momentum shift. Both weekly stochastic and RSI indicators reflect similar upward trends. Additionally, the Tom Demark Pressure Ratio (TDPR) at 21.77 suggests decreasing selling pressure, reinforcing the possibility of an upward reversal.
• Key resistance levels to watch include RM1.41 (50-day SMA) and RM1.43, aligning with the 23.6% Fibonacci retracement level. A breakout above these levels could drive the stock towards RM1.53, paving the way for further gains. On the downside, immediate support lies at RM1.22 (200-day SMA) with additional support around RM1.15, marking the lower boundary of the consolidation range.
• For traders seeking to capture this potential recovery, we recommend accumulating around RM1.29 with a take-profit target at RM1.40, offering an upside potential of about 8.5%. To mitigate risk, setting a stop-loss at RM1.20 limits downside risk to around 7.0%, establishing a balanced risk-reward ratio for those aiming to capitalize on the possible uptrend.

Source: Kenanga Research - 19 Nov 2024