Technical Highlights

The stock has been moving upward since mid-2022, but after reaching a high of RM4.03, it fell to a 52-week low of RM2.71. During this decline, a bullish falling wedge pattern formed, and yesterday, it broke out of this pattern with strong volume. Although the stock is still trading below the key EMAs, if buying momentum continues to build, it could soon rise above those levels.

Momentum indicators are looking good. The RSI is currently at 46.2 and continues to rise, suggesting increasing strength. Additionally, last week’s golden cross on the MACD aligns with the steady rise in volume, further supporting the case for a bullish reversal.

The ideal entry range for this stock is between RM2.81 and RM2.88. If it can break the first resistance at RM3.00, there’s potential for a climb towards RM3.25. Should the stock manage to trade above RM3.25, it could challenge the next resistance level at RM3.52. However, if the stock drops to RM2.66, it may signal the start of a correction.

Entry – RM2.81 – RM2.88

Stop Loss – RM2.66

Target Price – RM3.00 – RM3.25

Source: Mercury Securities Research - 22 Oct 2024