Technical Highlights

The stock has experienced a strong upward movement since early 2024, climbing from RM1.33 to a peak of RM4.47 in July. Following this high, the price pulled back to a major support level and began forming a triangle pattern. Yesterday, the stock broke out of this pattern with significant volume, signalling renewed bullish strength. Currently, it is making its fourth attempt to break the key resistance at RM3.25, a level that has held strong in the past. This time, with the stock trading above all 3 key EMAs and bullish sentiment growing, there’s strong potential for a successful breakout.

Momentum indicators further reinforce this positive outlook. The RSI is 63 and rising sharply. MACD formed a golden cross earlier this month and is continuing to move higher, while trading volume has been steadily increasing as selling pressure fades.

For entry, a good range would be between RM3.19 and RM3.25. The first resistance to watch is at RM3.58, and if this level is breached, the stock could rally toward the second resistance at RM3.99, where its previous decline began. On the downside, if the price falls to RM2.93, it could signal a false breakout from the triangle and trigger a potential correction.

Entry – RM3.19 – RM3.25

Stop Loss – RM2.93

Target Price – RM3.58 – RM3.99

Source: Mercury Securities Research - 23 Oct 2024