Technical Highlights

After entering a correction phase in mid-June due to muted trading interest, the stock reached a 52-week low before rebounding on renewed buying momentum driven by its attractive valuation. At the last closing price of RM0.845 yesterday, the stock achieved a triangle pattern breakout, signalling the potential for a trend reversal.

Momentum indicators are supportive of the trend reversal. The RSI continued to trend upward, signalling buying interest is accumulating. Similarly, the build-up of the stock's bullish momentum is confirmed by the upward-pointing MACD line.

Waiting for a pullback to the price range between RM0.835 to RM0.845 represents a good entry opportunity. If the stock successfully breaks out above the key resistance level at RM0.875, it could target the next resistance level at RM0.925. Conversely, if the stock drops below the recent support level at RM0.790, it could mean a false pattern break, followed by the consolidation phase.

Entry - RM0.835 - RM0.845

Stop Loss - RM0.730

Target Price - RM0.875 - RM0.925

Source: Mercury Securities Research - 27 Dec 2024