Technical Highlights

From September to November 2024, sustained buying pressure propelled the stock higher, closing in the green for every trading session. However, after reaching its peak, the stock underwent a sharp correction that erased the gains achieved during the prior uptrend. The sell-off was short-lived, as strong buying interest re-emerged before the stock dipped into oversold territory. This resurgence of buying interest propelled the stock's recovery, pushing it above all its EMA lines. On Friday, strong buying momentum drove the stock significantly higher, completing a breakout from the uptrend channel-an indicator of potential further gains.

Momentum indicators are showing strengths. The RSI is accelerating towards the overbought zone, indicating buying interest is accumulating. Likewise, the recent display of a golden cross in the MACD confirms the build-up of the stock's bullish outlook.

An ideal entry strategy would be between RM0.505 to RM0.515. The first resistance level to watch is RM0.535, and if this level is breached, we could see the stock testing the second resistance at RM0.560. Should the buying momentum remain strong, the third target price would be at RM0.580. On the downside, if the stock falls below RM0.465, it would indicate a false breakout and the start of a correction phase.

Entry - RM0.505 - RM0.515

Stop Loss - RM0.445

Target Price - RM0.535 - RM0.560 - RM0.580

Source: Mercury Securities Research - 20 Jan 2025