Technical Highlights

With the recent multiple swing, the stock seems to have found the EMA 20 line as support. The stock surged yesterday, and formed a large green candle at closing. More upswing potential may be on the card especially with the large green candle gapping up, breaking through the approximately 2-month long triangle with considerable momentum (RSI>70) and substantial trading volume (21.9x more than its average 90-days trading volume).

The golden cross happened yesterday with MACD line crossing above the signal line, signifies strong positive momentum going forward. Similarly, short-term bullishness is affirmative with both SMA 20 and RSI line facing upward.

We think the stock could potentially put the RM0.830 resistance and subsequently RM0.925 resistance to the test, which are derived based on the difference of RM0.095 of the high and low of the 2-month long triangle pattern. Conversely, a dip below RM0.590 could signal the commencement of a correction phase.

Entry – RM-0.735 – RM0.745

Stop Loss – RM0.585

Target Price – RM0.830 – RM0.925

Source: Mercury Securities Research - 12 Jul 2024