By Lawrence Yeo Eng Chien / lawrenceyeo@kenanga.com.my ; Steven Chan / steven.chan@kenanga.com.my; Muhammad Afif Zulkaplly / muhammad.afif@kenanga.com.my Figure 1: Daily Charting FBMKLCI Basic Data 52-week High 1,796.75 (in Million) 52-week Low 1,614.11 KLCI Vol 102.03 Current Level 1,782.74 Bursa Vol 2730.24 Intraday High 1,784.25 Bursa Val 2162.11 Intraday Low 1,778.27 Technical Ratings Resistance 2 1,789 MACD Bullish Resistance 1 1,783 RSI (14) Bullish Current Level 1,782.74 Stochastic Overbought Support 1 1,770 Support 2 1,760 Outlook Neutral-Bullish FBMKLCI finished with 2.84-point gain after softer opening Asian markets started the week on a positive note, after tensions over North Korea receded and as hurricane Irma was downgraded after making landfall in Florida. As for the local market, the FBMKLCI was up 2.84 points (0.16%) at 1,782.74. Broad market sentiment was stronger, with 527 gainers outnumbering the 350 decliners and 372 counters which traded unchanged. From a charting perspective, yesterday s candlestick demonstrated investors' continued willingness to buy on dips after the softer opening. With the MACD-Signal line now in a positive crossover and RSI above the 50-point mark, the FBMKLCI s overall technical picture is favouring the upside from here. The key index is now in the midst of retesting the key 1,783 (R1) resistance level. Should this level be taken out, the next resistance to target is 1,789 (R2) further up. Immediate support levels are now 1,770 (S1) and 1,760 (S2) below. Hurricane Irma and North Korea fears ebb Stocks on Wall Street rebounded and in the absence of another missile launch by North Korea over the weekend, and as damages from Hurricane Irma were less severe than initially feared. The S&P 500 surged to a new high led by insurers while the 30-stock index, the DJIA was up by 259.6pts (1.19%) at 22,057.37. Candlestick-wise, the DJIA gapped up 130.0pts at the opening bell and formed a long white candle which indicates that the bulls remained in firm control for the remainder of the day. Consequent to the bullish move yesterday, the DJIA has broken out of its month-long consolidation phase, and this is supported by a upwards hook by the key momentum indicators (MACD, RSI and Stochastic). From here, we expect a move to test the early-august high of 22,180 (R1). Once taken out, the DJIA would then have a clear path towards 22,597 (R2) next. Support levels are now 21,750 (S1) and 21,600 (S2) below. Daily technical highlights - (LEONFB, EFORCE) LEONFB (Not Rated). Steel counters extended their rally yesterday in line with higher steel prices as China continued to tighten steel production in the country. Among them included LEONFB, which climbed 6.5 sen (7.9%) to finish at a fresh alltime high of RM0.885. Chart-wise LEONFB kicked-off an uptrend earlier in January, climbing from a low of RM0.46 to as high as RM0.86 in June before staging a meaningful correction over the following month. Although the share price has recovered gradually, it wasn t until yesterday s decisive move that LEONFB s chart signaled a continuation of its prior uptrend. Key momentum indicators have also hooked upwards as a result, and as such, we see the potential for a further move towards RM0.96 (R1) and RM1.00 (R2) next. Downside support levels are RM0.80 (S1) and RM0.74 (S2). EFORCE (Not Rated). EFORCE caught our attention yesterday it surged a remarkable 10.0 sen (+8.3%) to close at record-high of RM1.30 with a white Marubozu candlestick. This was accompanied with exceptional trading volumes, with 5.5m shares exchanging hands more than 6x its average volume. More importantly, yesterday s move marked a significant breakout above the previous resistance band of RM1.20-1.23, which saw multiple retesting during its sideways consolidation since May. From here, we expect the share to be bullish biased, with a golden-crossover among all key SMAs, coupled with positive showings from key indicators. Sustained momentum would see the share trend higher towards resistances levels at RM1.40 (R1) and RM1.50 (R2). Conversely, a reversal in sentiment could find some supports at RM1.08 (S1) and RM0.88 (S2). PP7004/02/2013(031762) Page 1 of 5
Figure 2: Daily Charting Dow Jones Industrial Average Figure 3: Daily Charting Leon Fuat Berhad (Not Rated) About the stock: Shariah Compliant : No Name : Leon Fuat Berhad Bursa Code : LEONFB CAT Code : 5232 Market Cap : 274.4 52 Week High/Low : 0.89/0.43 3-m Avg. Daily Vol. : 1,545,808.00 Free Float (%) : 27.57% Beta vs. KLCI : 0.6 Key Support & Resistance Level Resistance : RM0.96 (R1) RM1.00 (R2) Support : RM0.80 (S1) RM0.74 (S2) Outlook : Bullish What does the indicator says MACD : Bullish RSI : Bullish Stochastic : Overbought Trend : Positive What should you do Current Share : RM0.885 Technical Target : - Technical Cut-loss : - Fundamental Call Kenanga : - Consensus : - PP7004/02/2013(031762) Page 2 of 5
Figure 4: Daily Charting Excel Force Msc Berhad (Not Rated) About the stock: Shariah Compliant : No Name : Excel Force Msc Berhad Bursa Code : EFORCE CAT Code : 0065 Market Cap : 537.9 52 Week High/Low : 1.3/0.55 3-m Avg. Daily Vol. : 716,503.30 Free Float (%) : 66.78% Beta vs. KLCI : -0.2 Key Support & Resistance Level Resistance : RM1.40 (R1) RM1.50 (R2) Support : RM1.08 (S1) RM0.88 (S2) Outlook : Bullish What does the indicator says MACD : Bullish RSI : Bullish Stochastic : Overbought Trend : Bullish What should you do Current Share : RM1.30 Technical Target : - Technical Cut-loss : - Fundamental Call Kenanga : - Consensus : - This section is intentionally left blank. PP7004/02/2013(031762) Page 3 of 5
Unrealised Positions (Sep 2017) No CATS Code Stock Name Issued Date (ID) @ ID Dividend Gain/ Gain/ Target Stop- Upside Downside Reward/ Last Received Loss Potential Risk Risk Ratio Loss (incl. since ID Div.) Loss RM RM (%) (%) (x) RM RM RM (%) Rating Comment/ Action 1 7097 TA WIN HOLDINGS BHD 16-Mar-17 0.625 1.540 1.100 146.40% 76.00% -1.9 1.270-0.65 103.20% BUY Upgraded TP/SL (8-Aug) 2 0089 TEX CYCLE TECHNOLOGY 21-Apr-17 1.270 1.460 1.150 14.96% -9.45% 1.6 1.280 0.010 0.02 1.57% BUY 3 0186 PERAK TRANSIT BHD 16-May-17 0.285 0.335 0.255 17.54% -10.53% 1.7 0.373 0.003 0.09 31.75% BUY 4 7231 WELLCALL HOLDINGS BHD 25-May-17 1.527 2.540 2.220 66.34% 45.38% -1.5 1.460 0.016-0.05-3.37% BUY 5 5181 SIG GASES BHD 21-Jul-17 0.935 1.170 0.835 25.13% -10.70% 2.4 1.180-0.25 26.20% BUY 6 4731 SCIENTEX BHD 5-Sep-17 8.910 9.640 8.440 8.19% -5.27% 1.6 9.510-0.60 6.73% BUY Simple Average 46.43% 14.24% 0.63 27.68% *Tracker does not include Non-Rated positions Realised Positions (Sep 2017) No CATS Code Stock Name Issued Date Buy Intraday price since Buy Date change since Buy Date (%) Sell Date Sell Dividend Received since ID Gain/ Loss (incl. Div.) (H) (L) (H) (L) RM RM RM (%) 1 5107 IQ GROUP HOLDINGS BHD 1-Aug-17 4.780 4.840 4.070 1.26% -14.85% 30-Aug-17 4.270 - -0.51-10.67% Stopped-out Gain/ Loss Rating Comment/ Action Simple Average 1.26% -14.85% -10.67% PP7004/02/2013(031762) Page 4 of 5
Basic Technical Terms: Reversal Candlesticks Patterns Description Doji Dragonfly Doji (Bullish) Gravestone Doji (Bearish) Engulfing Pattern Hammer (Bullish) Shooting Star (Bearish) Inverted Hammer (Bullish) Hanging Man (Bearish) Harami Harami Cross Dojis form when a security's open and close are virtually equal. The length of the upper and lower shadows can vary, and the resulting candlestick looks like, either, a cross, inverted cross, or plus sign. Doji convey a sense of indecision or tug-of-war between buyers and sellers. A reversal pattern that can be bearish or bullish, depending upon whether it appears at the end of an uptrend (bearish engulfing pattern) or a downtrend (bullish engulfing pattern). The first day is characterized by a small body, followed by a day whose body completely engulfs the previous day's price action. Hammer candlesticks form when a security moves significantly lower after the open, but rallies to close well above the intraday low. This appears in a downtrend. In contrast, the Shooting Star pattern appears in an uptrend. It opens higher, trades much higher, then closes near its open. It looks just like the Inverted Hammer except that it is bearish. The Inverted Hammer is a single-day bullish reversal pattern. In a downtrend, the open is lower, then it trades higher, but closes near its open price, therefore looking like an inverted lollipop. Hanging Man candlesticks form when a security moves significantly lower after the open, but rallies to close well above the intraday low. The Harami is a two-day pattern that can be bullish or bearish. It has a small body day completely contained within the range of the previous body, and is the opposite colour. The Harami Cross is similar to the Harami. The difference is that the last day is a Doji. Marubozu A Marubozu candlestick has no shadow extending from the body at either the open, the close or at both. Morning Doji Star (Bullish) Evening Doji Star (Bearish) Spinning Top A Morning Doji Star (Evening Doji Star) is a three-day candlestick bullish (bearish) reversal pattern - a long-bodied black (white) candle extending the current downtrend, a short middle candle that gapped down (up) on the open, and a long-bodied white candle that gapped up (down) on the open and closed above (below) the midpoint of the body of the first day. Spinning Tops are candlestick lines that have small bodies with upper and lower shadows that exceed the length of the body. They are similar to the Doji candlesticks, and signal indecision. Source: Various Common Chart Patterns Reversal Patterns Inverted Head & Shoulders (Bullish) Head & Shoulders (Bearish) Wedge Reversal (Bullish/ Bearish) Double Top (Bearish) Double Bottom (Bullish) Continuation Patterns Symmetrical Triangle (Bullish/ Bearish) Ascending Triangle (Bullish) Channels (Bullish/ Bearish) Flags (Bullish/ Bearish) Pennant (Bullish/ Bearish) Source: Various This document has been prepared for general circulation based on information obtained from sources believed to be reliable but we do not make any representations as to its accuracy or completeness. Any recommendation contained in this document does not have regard to the specific investment objectives, financial situation and the particular needs of any specific person who may read this document. This document is for the information of addressees only and is not to be taken in substitution for the exercise of judgement by addressees. Kenanga Investment Bank Berhad accepts no liability whatsoever for any direct or consequential loss arising from any use of this document or any solicitations of an offer to buy or sell any securities. Kenanga Investment Bank Berhad and its associates, their directors, and/or employees may have positions in, and may effect transactions in securities mentioned herein from time to time in the open market or otherwise, and may receive brokerage fees or act as principal or agent in dealings with respect to these companies. Published and printed by: KENANGA INVESTMENT BANK BERHAD (15678-H) Level 12, Kenanga Tower, 237, Jalan Tun Razak, 50400 Kuala Lumpur, Malaysia Telephone: (603) 2172 0880 Website: www.kenanga.com.my Email: research@kenanga.com.my Chan Ken Yew Head of Research PP7004/02/2013(031762) Page 5 of 5