Technical Highlights

After forming a bullish W-shaped pattern, the stock has been consolidating in a small sideways range. Prior to the W-pattern, we also observed a brief consolidation zone, which indicates steady accumulation. After completing the W-shape, another minor consolidation phase is emerging, indicating that a potential breakout is near. Supporting this bullish outlook, the stock is currently trading above all the three key EMAs and yesterday's session was closed with a bullish Dragonfly Doji candlestick.

Momentum indicators are showing encouraging signs. The RSI is currently at 60 and has started to move upward. Similarity, the MACD has also shifted upward steadily.

An ideal entry strategy would be between RM2.18 to RM2.22. The first resistance level to watch is RM2.35, and if this level is breached, we could see the stock testing the second resistance at RM2.46, a key point where the previous decline began. Should buying momentum remain strong, the third target price would be the 52-week high of RM2.55. On the downside, if the stock falls below RM2.09, it would indicate a breakdown from the key support zone and start a new downtrend.

Entry - RM2.18 - RM2.22

Stop Loss - RM2.09

Target Price - RM2.35 - RM2.45 - RM2.55

Source: Mercury Securities Research - 10 Jan 2025