Technical Highlights

After reaching its 52-week high in early June, a series of gap-down movements sent the stock into deep consolidation. Despite multiple rebound attempts, the recovery seemed weak as each subsequent rebound reached a smaller peak. Recently, however, the stock has shown strength, forming higher highs and higher lows. This upward movement broke through the wedge pattern in the last trading session as buying interest reignited, signalling more upside potential on the horizon.

Momentum indicators are supportive of the pattern breakout. The RSI is rebounding strongly after a period of sideways movement, signalling that buying interest is accumulating. Short-term bullishness is further confirmed by the upward-trending MACD and 20-day EMA line.

An ideal entry range lies between RM1.85 and RM1.91. If momentum continues to grow, the stock could gather strength to challenge its first resistance at RM2.01. A successful breakout here would set up the next resistance level at RM2.25. Conversely, a downward move breaking recent support at RM1.87 could indicate a return to consolidation phase.

Entry – RM1.85 – RM1.91

Stop Loss – RM1.75

Target Price – RM2.01 – RM2.25

Source: Mercury Securities Research - 1 Nov 2024