Technical Highlights

Since late May, the stock has been consolidating within a sideways range, forming a falling wedge pattern as trading interest turned muted. However, yesterday's trading session marked a bullish shift, with the stock closing higher on strong buying interest, accompanied by a large Marubozu candle. The close above the short-term (20-day) and medium-term (100-day) EMAs reinforces a positive technical setup. This momentum positions the stock for a potential breakout from the falling wedge pattern, suggesting further upside in the near term.

Momentum indicators are showing positive signals. The RSI is accelerating towards the oversold zone, indicating the reignition of buying interest in the stock. Likewise, the MACD is nearing to form a golden cross, confirming the build-up of the stock's positive momentum.

An ideal entry point would be after a slight pullback to the range of RM0.285 to RM0.290, where buying interest appears concentrated. The first resistance level is at RM0.300, and a successful breakout could see the stock testing RM0.335. If the positive buying momentum continues, the stock may test the next resistance level at RM0.350. Conversely, if the stock falls below RM0.270, it could indicate the stock could have entered into consolidation mode.

Entry - RM0.285 - RM0.290

Stop Loss - RM0.250

Target Price - RM0.300 - RM0.335 - RM0.350

Source: Mercury Securities Research - 17 Jan 2025