Technical Highlights

After reaching a peak of RM0.495 in November 2024, the stock faced a sharp pullback, leading to a consolidation phase. During this period, the stock formed a triangle pattern, indicating a tightening range of movement. Just yesterday, the stock broke out from this triangle pattern with an impressive 8.3% gain, accompanied by the highest trading volume since September. Furthermore, this breakout has also pushed the stock above all the three key EMAs, reinforcing a bullish outlook.

Momentum indicators are looking good. The RSI is currently at 65, reflecting a rebound from a two-month neutral range and confirming stronger buying momentum. Meanwhile, the MACD has started to gain upward traction after a prolonged period of sideways movement.

An ideal entry for this stock would be a healthy pullback to the RM0.440 to RM0.450 range. The first resistance level to watch is RM0.475, followed by the 52-week high at RM0.495. If buying momentum continues to hold, the stock could break through its previous high and charge toward a new all-time high, with the next target at RM0.520 based on the trend-based Fibonacci extension. On the flip side, if the stock falls below RM0.415, it would indicate a breakdown from a key support zone and return to a downtrend.

Entry - RM0.440 - RM0.450

Stop Loss - RM0.415

Target Price - RM0.475 - RM0.495 - RM0.520

Source: Mercury Securities Research - 10 Jan 2025