DAYANG ENTERPRISE HOLDINGS BERHAD (Technical Buy)

• Dayang Enterprise Holdings Bhd (DAYANG) closed at RM2.03 yesterday, gaining 0.50%, as the stock consolidated near its immediate support level of RM2.00, indicating potential stabilisation following its recent downtrend. The recent price action, characterised by a narrow trading range, suggests possible accumulation at current levels.
• From a technical perspective, the stochastic oscillator at 7.60 remains deeply oversold, signalling the possibility of a technical rebound as selling pressure eases. The Tom Demark Pressure Ratio (TDRP) at 12.99 indicates diminished downward momentum, fostering a supportive environment for recovery. Meanwhile, the RSI at 38.63 shows stabilising momentum, with a bullish divergence suggesting improving sentiment as the stock approaches the oversold territory. The weekly technical chart also highlights a similar set-up, further reinforcing the likelihood of a rebound.
• Immediate resistance is positioned at RM2.06, aligned with the 61.8% Fibonacci retracement level. A breakout above this level could drive the stock towards RM2.12 (aligned with the 13-day SMA) and RM2.21 (the 50-day SMA). On the downside, immediate support lies at RM2.00, with an additional buffer at RM1.79, providing robust protection against further declines.
• For traders aiming to leverage DAYANG's recovery potential, accumulating the stock between RM2.01 and RM2.03 may offer an attractive entry point. A take-profit target at RM2.20 provides an upside potential of approximately 8.4%, while a stop-loss at RM1.90 limits downside risk to around 6.4%. This set-up presents a favourable risk-reward profile for traders anticipating a rebound in DAYANG's price trajectory.

Source: Kenanga Research - 11 Dec 2024