FOCUS POINT HOLDINGS BHD (Technical Buy)

• Focus Point Holdings Bhd (FOCUSP) closed at RM0.795 yesterday, marking a gain of 1.92%. The stock rebounded from its critical 200-day SMA and managed to close above all key short-term and long-term SMAs, indicating a potential bullish trend reversal. The convergence of these SMAs suggests the stock may be gearing up for a directional move.
• From a technical standpoint, the stochastic oscillator is emerging from oversold conditions, indicating early signs of rising buying momentum. The Tom Demark Pressure Ratio (TDPR) is stabilizing around 33.95 hinting at the possibility of upward movement as momentum builds. Additionally, the RSI is trending upward at 54.22, reflecting improving sentiment and supports the potential for further price gains.
• Immediate resistance lies at RM0.805 (38.2% Fibonacci retracement) and a breakout above this level could drive the stock toward higher resistance at RM0.835 (23.6% Fibonacci retracement) and its recent high of RM0.845. Conversely, key support levels are at RM0.785 (50-day SMA), RM0.774 (200-day SMA) and RM0.765 (61.8% Fibonacci retracement).
• We recommend entering the stock near RM0.795 and setting a take-profit target at RM0.840, offering an upside potential of approximately 5.7%. To mitigate risk, a stop-loss should be placed at RM0.760, limiting potential losses to about 4.4%.

Source: Kenanga Research - 20 Nov 2024