Technical Highlights

The stock has been moving within a consolidation zone between RM0.77 and RM0.79. Just yesterday, it broke out of this range, completing a bullish triangle pattern. Adding to this positive sentiment is the bear trap spotted last week, which preceded this breakout. Currently, the stock is trading above all three key EMAs, reflecting its strong upward momentum.

Momentum indicators are looking favourable. The RSI, which previously dipped into the oversold zone, has bounced back and now stands at 61, continuing to trend upward. Additionally, the MACD formed a golden cross yesterday and buying pressure has also been increasing steadily, reaching its highest levels since July.

An ideal entry point for the stock lies between RM0.785 and RM0.795, allowing for a slight pullback before entry. The first resistance is at RM0.830, with the second at RM0.860. A breakthrough beyond these levels could see the stock targeting its 52- week high of RM0.885. On the flip side, if the stock falls below RM0.760, it would trigger a correction. This setup offers a risk-to-reward ratio of 2.33.

Entry - RM0.785 - RM0.795

Stop Loss - RM0.760

Target Price - RM0.830 - RM0.860 - RM0.885

Source: Mercury Securities Research - 27 Nov 2024