Technical Highlights

The stock broke above a downtrend line yesterday, accompanied by the highest buying volume since June 2024. It’s currently trading above the 20-day EMA and has just touched the 50-day and 200-day EMAs following the breakout. The EMA zone around RM2.42 will be crucial to monitor in the coming days, as it could serve as a key support or resistance level. Momentum indicators look positive for the stock. The RSI is at 54 and moving upward, suggesting strengthening momentum. Additionally, the MACD previously formed a golden cross, which is now trending higher. If this upward momentum continues, we may see another golden cross soon, adding to the bullish outlook. An ideal entry range is between RM2.38 and RM2.43. The first resistance level is at RM2.52; if this level is breached, the next target will be RM2.73. Should the stock clear this second resistance, it may challenge its 52-week high at RM2.83. However, this could take time due to previous consolidation in this area, which will require strong turnover to break. On the other hand, if the stock struggles to challenge all three key EMAs, it could decline toward major support at RM2.23. A drop below this support level will indicate the beginning of a correction.

Entry – RM2.38 – RM2.43

Stop Loss – RM2.23

Target Price – RM2.52 – RM2.73

Source: Mercury Securities Research - 26 Sep 2024