Technical Highlights

The recent formation of a double large green candle and double gap-up sent the share price to trade above all the EMA lines. Last Friday, a Marubozu candle was formed as the share price surged at closing with considerable trading volume (3.6x higher than its 90-day trading volume), breaking past an approximately 5-week-long flag pattern, signifying that more upswing may be underway.

With MACD hooking up and the RSI hovering above the overbought territory, this confirms the upward momentum and short-term bullishness.

With significant momentum, we think the stock could potentially test the resistance at RM2.370 first and subsequently at RM2.495 (determined by the difference of RM0.125 between the high and low of the flag pattern). Conversely, consolidation happens if the share price dips below the RM2.030 support (a few ticks below the recent downswing).

Entry – RM-2.260 – RM2.270

Stop Loss – RM1.930

Target Price – RM2.370 – RM2.495

Source: Mercury Securities Research - 15 Jul 2024