Technical Highlights

A positive trend was seen recently with the stock surging, sending the share price to trade above all of its EMA lines. A large green candle was formed at closing, breaking past the 2-month-long rectangular pattern with considerable momentum (RSI>70), denoting the possibility of further upward potential.

The recent golden cross shown by the MACD, paired with both the RSI and 20-EMA line facing upward, indicates positive momentum going forward.

With the growing momentum, we think the stock could potentially put the RM1.650 resistance and the subsequent RM1.850 resistance to the test (appertaining to the difference of RM0.20 between the high and low of the rectangular pattern). Conversely, a fall below RM1.430 (a few points below the recent downswing) could signal the start of a correction phase.

Entry – RM-1.620 – RM1.630

Stop Loss – RM1.420

Target Price – RM1.650 – RM1.850

Source: Mercury Securities Research - 17 Jul 2024