Technical Highlights

After making several unsuccessful attempts to challenge its 52-week high, the stock lost momentum and entered a consolidation phase. However, recently, the stock has shown signs of a trend reversal by exhibiting a pattern of higher highs and higher lows. This trend reversal is promising, as the stock began to rise after breaking out of a double-bottom pattern in early September. Furthermore, the stock continued to surge and closed significantly higher at RM0.980, approaching the crucial resistance level at RM0.985.

Momentum indicators are showing a bullish signal. The RSI indicator rebounds back upward after a few days of neutral movement, and is approaching the overbought territory. Similarly, the MACD continue to inch upward after the occurrence of a golden cross back in early September.

If the stock is able to continue its positive movement and breaks through the crucial resistance level at RM0.985, RM1.11 would be the next resistance target to challenge. On the flip side, if it falls back to RM0.925, which is the neckline of the double bottom pattern, this could signal a false trend reversal, with a correction down to RM0.840.

Entry – RM0.950 – RM0.980

Stop Loss – RM0.915

Target Price – RM0.985 – RM1.11

Source: Mercury Securities Research - 20 Sep 2024