Technical Highlights

The stock has recently been on a five-day downtrend but has shown signs of recovery after bouncing off a key support level at RM0.380. Yesterday, the price reached the ceiling of the downward trendline with strong volume, signalling potential upward momentum. While the stock is currently trading below its 200-day EMA, it is quickly approaching its 20- and 50-day EMAs, which could serve as key hurdles in the near term.

Momentum indicators are also pointing in a favorable direction. The RSI has bounced off the oversold zone and is now trading at 39. Similarly, the MACD is on the verge of forming a golden cross if the buying momentum sustains.

The ideal entry point for this stock lies in the range of RM0.420 to RM0.440, with the first level of resistance at RM0.445. Should the stock manage to break through this resistance, the next target would be RM0.510. If the upward momentum persists, the stock could continue its climb toward RM0.555. However, if it falls below RM0.380, a trend reversal is likely, and the stock could head back into a downtrend.

Entry - RM0.420 - RM0.440

Stop Loss - RM0.380

Target Price - RM0.445 - RM0.510 - RM0.555

Source: Mercury Securities Research - 21 Jan 2025