· WINTONI (Close Position). We issued a “Trading Buy” call on WINTONI on 7 July 2015 with the expectation that the share price could rally towards the downtrend trend line resistance of RM0.37. However, the share price did not perform according to our expectation, trading sideways for the past two weeks. Readings from key momentum indicators are relatively neutral, coupled with tepid trading volume, showing the low buying interests. We reckon that share price could continue its sideways move for the near-term. As such, we are closing position on WINTONI, but may re-visit the stock should the technical picture turns bullish again.

· MPI (Trading Buy, TP: RM7.19) has been trending in a downtrend after it hit a recent high of RM7.19. MPI managed to find support at RM6.36 (S1) and reversed from the downtrend. Yesterday, the share price broke above the downtrend trend line to settle at RM6.70 (+2.92%), with the support of strong daily trading volume. Indicator-wise, MACD histogram is performing a positive crossover and coupled with both Stochastics and RSI hooking upwards, this is suggesting bullish buying momentum. Thus, we are placing a “Trading Buy” call with a target price of RM7.19 (R2) and a strict stop-loss of RM6.36 (S1). Meanwhile, should the buying momentum persist; the share price could potentially break above the previous high of RM7.19 (R2) and rally towards our objective measurement target price of RM7.48.

· Yesterday, KAREX (NR) surged 7.21% or 24.0 sen to close at record high of RM3.59. Chart-wise, a long white candlestick has formed, and the share price has broken above its upper Bollinger band. The MACD’s bullish divergence continued to expand, while key momentum indicators such as Stochastic and RSI are trending deeper into the overbought territory, suggesting a short-term consolidation is imminent. As such, investors interested in KAREX may look to “Buy on Weakness” should the share price consolidate towards the immediate support level of RM3.47 (S1).

Source: Kenanga Research - 29 Jul 2015