Just two days ago (6 Feb), we highlighted that BENALEC was trading close to the confluence of support levels at RM1.13/14, and that buying interest may exist at those levels. True enough, BENALEC confirmed the “Morning Doji Star” bullish reversal candlestick yesterday after rising 2sen at RM1.16. The tri-candlestick pattern represents a strong reversal pattern, and is particularly effective when used in conjunction with the trend line support levels.
The key indicators have also hooked upwards, and we reckon that a rebound is in the making. As such, we are upgrading our previous ‘Non-rated’ recommendation to a ‘technical buy’. From here, we expect the share price to climb higher towards RM1.27, and suggest that traders target RM1.25 (2 bids below the RM1.27 resistance). Meanwhile, a stop-loss of RM1.08 should also be placed.
below: Benalec Daily Chart (click to enlarge)
by Kenanga Research