Technical Highlights

Yesterday, the surge in the trading volume (57.6x higher than its 90-day average trading volume) sent the share price to jump above its 200-day EMA line. More upside may be in the offing especially with the formation of a large green candle at closing, which has broken through the 16-month long double-bottom pattern with considerable momentum (RSI just surged above the overbought territory today.).

The momentum is linked to the recent golden cross on the MACD. Short-term bullishness is also supported by an upward-pointing 20-EMA line.

With the share price broke through the neckline of the double-bottom pattern at RM 0.220, we think the stock could potentially test the resistance at RM0.280 first and subsequently at RM0.340 (52-week high). These target prices are formulated from the RM0.06 difference between the peak and trough of the double-bottom pattern. Conversely, consolidation happens if the share price dips below the RM0.200 support.

Entry – RM-0.240 – RM0.245

Stop Loss – RM0.195

Target Price – RM0.280 – RM0.340

Source: Mercury Securities Research - 17 Jul 2024