Technical Highlights

After reaching a 52-week high in mid-July, the stock entered a period of mild consolidation before starting to trend sideways. However, last Friday, a return of trading momentum pushed the stock higher, leading to a breakout from the triangle pattern. This breakout signifies that the stock has moved beyond the sideways trend and has entered a bullish upward trend.

Momentum indicators are currently strong and supportive of a positive trend change. The RSI indicator is gaining momentum, indicating increased strength. Additionally, the upward-trending MACD and the stock trading above its 20-day EMA suggest the formation of a strong bullish trend ahead.

An ideal entry point for the stock is between RM0.645 and RM0.660. If the upward momentum continues, this could push the stock to challenge its first resistance level at RM0.700. If it breaks through this point, the stock may then aim for the next resistance at RM0.730, which is the closing price before the recent sell-off. On the other hand, a false breakout could occur if the stock drops below its recent support level at RM0.640.

Entry – RM0.645 – RM0.660

Stop Loss – RM0.600

Target Price – RM0.700 – RM0.730

Source: Mercury Securities Research - 28 Oct 2024