Date of Report: October 1, 2024
Broker: CGS-CIMB Securities Malaysia Sdn. Bhd.

Company Overview

Magma Group Berhad is an investment holding company primarily focused on the hospitality sector. The company offers a range of services, including accommodation, dining, spa, and other related services, catering to customers across Asia.

Technical Overview

As of October 1, 2024, Magma Group’s stock price is RM0.235. The stock recently surged, forming a long white candle on the back of higher trading volume, signaling a breakout from a 10-month consolidation triangle. The breakout is a positive technical signal that indicates the next upward move is in progress, potentially leading to further gains in the stock.

Entry and Stop-Loss Recommendations

Traders are encouraged to enter long positions in Magma Group within the price range of RM0.220 to RM0.235. To manage risk, a stop-loss should be placed at RM0.205, just below the 50-day Exponential Moving Average (EMA). This strategy is designed to allow traders to benefit from the potential upside while limiting downside exposure.

Price Targets and Resistance Levels

Magma Group’s immediate price targets are RM0.26 and RM0.29. These levels represent the historical resistances that the stock could test in the near future, assuming the bullish momentum continues.

Support Levels

The key support levels to watch for Magma Group are RM0.210 and RM0.185. These support levels provide a safety net, and the stop-loss is set just below the first support level at RM0.205 to safeguard against downside risk.

Technical Indicators

The Moving Average Convergence Divergence (MACD) and Relative Strength Index (RSI) have both hooked up, signaling that the bulls are still in control. This suggests that further upside is likely, as these indicators typically reflect improving market momentum in favor of buyers.

Conclusion

Magma Group’s technical breakout from a lengthy consolidation phase signals strong upside potential. Traders looking to capitalize on this momentum should consider entering long positions, with a stop-loss placed at RM0.205 to mitigate risk. The stock is expected to test higher price targets at RM0.26 and RM0.29, with positive technical indicators supporting further bullish movements.