Technical Highlights

The stock has entered into a consolidation phase, after a roughly 3-month long bullish uptrend towards its 52-week high. A signal for a trend reversal was absent until yesterday when the stock surged, causing a gap-up in the price that broke through the important pennant pattern. This also caused the stock to trade above its EMA 20 line, indicating that short-term bullishness is on the horizon.

MACD indicates strengthening momentum as the MACD line crossed above the signal line yesterday. Additionally, both the RSI and the 20 EMA line are pointing upwards, further confirming the positive momentum and short-term bullishness of the stock.

The ideal entry point would be between RM1.00 to RM1.05. Since the last closing price is at the crucial resistance level (RM1.05), the breaking out of this level could push the stock to challenge its next resistance level at RM1.15. Inversely, if the stock consolidates and trades towards its support level of RM0.955, this could signal that the trend reversal may have lapsed.

Entry – RM1.00 – RM1.05

Stop Loss – RM0.905

Target Price – RM1.05 – RM1.15

Source: Mercury Research - 8 Oct 2024