Technical Highlights

Since early 2024, this stock has been trending downward, but within this decline, a bullish falling wedge pattern has been formed. Last week, the stock managed to break out of this pattern but initially moved sideways for a few days. However, yesterday the stock has fully confirmed the breakout with the highest buying volume since early August. Currently, the stock is trading above the 20-day EMA, indicating short-term strength, though it remains below both the 50-day and 200-day EMAs.

Momentum indicators are showing a positive outlook. The MACD saw a golden cross in early September and continues to trend upward, with the potential for another golden cross if buying momentum strengthens. The RSI, which stayed in neutral momentum for several months, has now risen to 53 following yesterday’s breakout and is moving higher, reflecting renewed bullish momentum.

Waiting for a slight pullback to the RM4.17–RM4.23 range could present an ideal entry point. The first resistance to watch is RM4.44, and if it breaks, the stock could aim for the next target at RM4.65. This level, previously a strong support, now acts as a significant resistance. A breakout above RM4.65 would suggest a shift into a sustained uptrend. On the downside, if the stock falls below RM4.01, it could trigger a major correction, as this level has been a key support since 2021.

Entry – RM4.17 – RM4.23

Stop Loss – RM4.01

Target Price – RM4.44 – RM4.65

Source: Mercury Securities Research - 1 Oct 2024