Technical Highlights

Over the past five months, the stock has been steadily forming a symmetrical triangle pattern, reflecting a period of consolidation as the price tightened into a narrowing range. Last Friday, this pattern was broken out with a significant 13% surge, marking a strong breakout from the previous consolidation. The breakout has now pushed the stock above all three key EMAs, signalling a potential shift in momentum to the upside.

Momentum indicators are aligning well with this breakout. The RSI is currently sitting at 62, moving upward from a recent bounce off the 50 level. Though not yet in overbought level, this upward momentum indicated continued buying interest. Additionally, the MACD also has seen a sharp upward turn, supported by increasing buying volume, reinforcing the stock's current bullish sentiment.

Looking ahead, a pullback to the range of RM0.210 to RM0.215 could offer good entry points. The first resistance stands at RM 0.235. A successful break above this level would set the stage for a move toward the next resistance at RM 0.265. If the stock can maintain support above RM 0.265 for a sustained period, it has the potential to climb even higher. On the flip side, if the stock dips below RM 0.185, it will be pulling the price back into the accumulation zone.

Entry – RM0.210 – RM0.215

Stop Loss – RM0.185

Target Price – RM0.235 – RM0.265

Source: Mercury Securities Research - 7 Oct 2024