Technical Highlights

The stock has been forming a falling wedge pattern, and just yesterday, it broke out from this squeeze zone with the highest buying volume seen since May 2024. This breakout indicates a strong buying interest and marks a potential shift in momentum. Meanwhile, the stock is currently trading above its 20-day EMA, but faces upcoming challenges as it approaches the 50-day and 200-day EMAs.

Momentum indicators further support this positive outlook. The RSI has rebounded from oversold levels and is now trending upward, currently at 52. Similarly, the MACD has started moving upward after months of neutral movement.

An ideal entry point lies in the range of RM0.745 to RM0.755. The first resistance level is at RM0.770, and if the stock successfully breaks through, it could climb to RM0.800. Beyond this, the stock has the potential to rally further to RM0.870, a key level where the previous downtrend began. On the downside, if the stock falls below RM0.715, it could start a correction. This setup offers a risk-reward ratio of 1.8.

Entry - RM0.745 - RM0.755

Stop Loss - RM0.715

Target Price - RM0.770 - RM0.800 - RM0.870

Source: Mercury Securities Research - 28 Nov 2024