Technical Highlights

The consolidation phase (following the previous 52-week high) came to an end yesterday when the stock surged and closed at a new 52-week high price of RM1.18. Additionally, the stock had also been trading above all its 20-EMA lines over the past 1 month. Momentum was still keeping up, especially with the formation of green candle that broke through the 2-month long pennant pattern with strong momentum (RSI is near approaching the overbought territory). With these positive signals, we think that upswing potential may still be in play. . Yesterday, the MACD exhibited a golden cross, which denotes strong momentum going forward. Additionally, the upward-pointing 20-EMA line confirms its short-term bullishness.

Given the pattern break-out with momentum, we think the share could test the new 52-week high resistance at RM1.41 first and subsequently at 1.50 resistance. Conversely, consolidation starts if the share price dips below the RM1.06 support.

Entry – RM-1.18 – RM1.20

Stop Loss – RM1.05

Target Price – RM1.41 – RM1.50

Source: Mercury Securities Research - 2 Aug 2024