YTL POWER INTERNATIONAL BHD (Technical Buy)

• YTL Power International Bhd (YTLPOWR) closed at RM3.72, reflecting a modest gain of 0.54%. The stock has been hovering near its 5-day SMA, which provides solid support. Yesterday, the 5-day SMA crossed above the 13-day SMA, suggesting growing bullish momentum. Additionally, the stock has formed a "three white soldiers" candlestick pattern, further reinforcing the potential for a bullish reversal.
• From a technical perspective, the stochastic oscillator is stabilising at 46.40, indicating a balance between buying and selling momentum. Meanwhile, the increasing Tom Demark Pressure Ratio (TDPR) at 57.77 reflects diminishing selling pressure, while the RSI trending upward 45.61, signals improving sentiment and potential for further upward movement.
• Looking forward, a decisive breakout above the immediate resistance at RM3.85 (50-day SMA) could propel the stock towards the next resistance level at RM4.16, which coincides with its 200-day SMA. On the flip side, if the price falls below the key support level of RM3.48, it may signal a renewed downtrend.
• We recommend entering the stock at RM3.72 with a take-profit target set at RM4.15, offering a potential upside of about 11.6%. To manage risk, we suggest setting a stop-loss at RM3.40, limiting potential losses to approximately 8.6%.

Source: Kenanga Research - 14 Oct 2024