Technical Highlights

The stock has shown strong buying interest, leading to multiple upward trends over the past 7 months. However, a sharp downward revision from its 52-week high showed the start of a consolidation phase as momentum weakened. Yesterday, the stock spiked and broke out of both the pennant pattern and the important RM0.540 resistance line, signalling the start of an upward trend. This signal is further supported by the stock trading above all its EMA lines.

Momentum indicators are flashing positive signs. The RSI is showing strong rebound from the recent downward movement, signalling the return of buying strength. Meanwhile, the MACD also confirmed the positive momentum with a golden cross yesterday, indicating a growing bullish trend.

An ideal entry point can be placed between RM0.500 to RM0.550. The first resistance lies at RM0.595 (52-week high) and a breakthrough here could lead to the stock testing the next resistance level at RM0.645. Conversely, the stock could fall into consolidation phase if it dips below its recent support level at RM0.495.

Entry – RM0.500 – RM0.550

Stop Loss – RM0.445

Target Price – RM0.595 – RM0.645

Source: Mercury Securities Research - 9 Oct 2024