Technical Highlights

The stock has shown a strong uptrend since early 2024, reaching a peak of RM1.35 in July before retracing to a recent low of RM0.81. Since September, it has been consolidating within a defined range. Encouragingly, the stock has formed a bear trap within this zone and is now trading above all three key EMAs for the first time during this consolidation phase-an early sign of potential upward momentum.

Momentum indicators are signaling improving strength. The RSI is at 52 and continues to trend upward, while the MACD also formed a golden cross earlier this month and continues to rise steadily. Additionally, trading volumes are also picking up after months of neutral activity, indicating renewed buying interest.

An ideal entry point lies between RM0.90 and RM0.92. If the stock breaks out of the rectangle box, the first resistance is at RM0.97, with further upside potential to RM1.08. On the downside, a break below RM0.85 could initiate a correction phase. This setup offers an appealing risk-to-reward ratio of 3.

Entry - RM0.90 - RM0.92

Stop Loss - RM0.85

Target Price - RM0.97 - RM1.08

Source: Mercury Securities Research - 16 Dec 2024