Technical Highlights

The stock experienced a strong uptrend in early 2024, before entering a period of sideways movement from March through July. In August, it shifted into a downtrend while quietly forming a triangle pattern. Last week, the stock broke out of the triangle and successfully completed a pullback above the downtrend line. With yesterday’s impressive 4% rebound, the stock is now trading above all three key EMAs, signaling a potential return to bullish momentum.

Momentum indicators are flashing positive signs. The RSI currently stands at 56 and is trending upward, leaving plenty of room before reaching overbought levels. Interestingly, even during the recent downtrend, the RSI formed higher lows, indicating underlying strength. The MACD is also moving upward with sustained bullish momentum.

An ideal entry point for this stock would be within the RM1.79 to RM1.85 range. The first resistance is set at RM1.90, and if the stock breaks this level, it could challenge RM2.08, a major resistance point. A breakthrough beyond RM2.08 could push the stock toward its 52-week high if momentum continues. On the downside, if the stock falls below RM1.68, it will indicate a false breakout, likely triggering a correction toward RM1.55, a previous accumulation zone.

Entry – RM1.79 – RM1.85

Stop Loss – RM1.68

Target Price – RM1.90 – RM2.08

Source: Mercury Research - 1 Oct 2024