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– MMC Corporation (MMC MK; RM2.39, SELL) – Probabilities are favouring the bears.
– Tan Chong Motor Holdings (TCM MK; RM2.46, BUY) – Re-gained its footing.
– Boustead Holdings (BOUS MK; RM3.57, BUY) – Potential breakout.
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MMC Corporation (MMC MK; RM2.39) – SELL
FY10P/E: 12.0x, P/BV: 1.2x

• MMC has been consolidating in a triangle pattern over the past few weeks. The longer it stays in this triangle, we see higher chances of it breaking below the support trend line. In addition, the candlesticks are hovering below its key SMAs, which is a negative sign.
• MACD has slipped into the red while RSI is below the 50-mark. We expect selling pressure to gain strength in the near-term.
• Any rebound towards its key SMAs at RM2.47-RM2.50 is an opportunity to lock in profits. A break below the RM2.32 support trend line would likely indicate that a deeper correction is underway, probably towards RM2.25 and RM2.15 next.

MMC Corporation Berhad is an investment holding company. The company, through its subsidiaries and associated company, operates a container port, provides power generation, distributes natural gas, and provides engineering and construction services.
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Tan Chong Motor Holdings (TCM MK; RM2.46) – BUY
FY10P/E: 8.6x, P/BV: 1.1x

• Tan Chong is still holding firm in its medium-term uptrend channel but its recent pullback below the support trend line did caution us about the possibility of a deeper correction. Our concern however was subsequently counteracted by a spike above its 30-day SMA.
• The stock has re-gained its footing and is currently moving towards the next resistance at RM2.60. After that, RM2.70 (52-week high) is its next target. Our positive stance is substantiated by the rising MACD and RSI indicators.
• We will be wrong however if prices fall below the 50-day SMA at RM2.28 as it would likely trigger more downside. Until then, we think the bulls are in place.

Tan Chong Motor Holdings Berhad assembles and distributes motor vehicles, and manufactures and sells auto parts and accessories. The company also distributes cosmetics, cellular phones, and industrial, agricultural and construction equipment. Tan Chong Motors provides auto insurance, car rental, travel, leasing, and financing services as well as develops properties.
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Boustead Holdings (BOUS MK; RM3.57) – BUY
FY10P/E: 8.6x, P/BV: 0.9x

• On the daily chart, it seems that the candle is about to swing past the resistance trend line. Another white candle today would likely confirm its bullishness.
• MACD has turned positive while its RSI has also hooked upward. We are now waiting for its 30-day SMA to cut above the longer-term 50-day SMA, as it may suggest the end of this consolidation tone.
• Risk takers may start to nibble now but always put a stop at below RM3.33 (support trend line). As long as RM3.33 holds firm, we believe it is right on track to test the RM3.71 resistance, and possibly even the Aug’s high of RM3.87 next.

Boustead Holdings Berhad is an investment holding company. The company, through its subsidiaries, develops properties, provides financial services, and operates oil palm and rubber plantations. Boustead Holdings also manufactures building materials, food, toiletries, housewares, and provides shipping services.

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– KLCI Index Futures – A triangle in the making?
– Crude oil futures – Consolidation is likely to continue.
– CPO futures – Momentum could still last a while longer.
– TSH Resources (TSH MK; RM1.95, BUY) – Broke out of trend line resistance.
– Jerneh Asia (JER MK; RM2.04, SELL) – Probabilities are favouring the bears.
– Ranhill (RANH MK; RM0.86, SELL) – Follow through momentum is weak.
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TSH Resources (TSH MK; RM1.95) – BUY
FY10P/E: 12.7x, P/BV: 1.1x

• TSH has been gyrating in a triangle pattern over the past few months until it broke out of the trend line resistance last Friday. This is encouraging as it may signal more upside ahead. Next resistance is seen at RM2.04 and RM2.15.
• The improving technical landscape also supports our positive stance on the stock. Both MACD and RSI signal lines are rising.
• We need another white candle to confirm this bullish tone. Remember to keep a stop at RM1.86, as a fake-out would likely drag it lower towards the next support at RM1.78.

TSH Resources Berhad is an investment holding company that processes and distributes cocoa beans and cocoa products along with operating palm oil plantations and palm oil milling. The company also manufactures and supplies an wood and timber products and is involved in the generation of electricity.
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Jerneh Asia (JER MK; RM2.04) – SELL
FY10P/E: 19.4x, P/BV: 0.9x

• The sharp rise over the past few days lifted Jerneh to a new 52-week high of RM2.16 in intraday trading last Friday. However, we think this uptrend may be at its tail-end as its price pattern looks exhaustive.
• A spinning top indicates potential weakness among the bulls. A black candle today would mean more downside ahead.
• We think the probabilities are favouring the bears at the moment. Therefore, traders should do well selling into strength, likely near RM2.16-RM2.22 zone. Immediate support is seen at RM1.94, followed by RM1.79 next.

Jerneh Asia Berhad underwrites general insurance such as fire insurance, marine insurance, vehicle insurance and miscellaneous insurance. Through its subsidiaries, the company also operates hire purchase and leasing business, offshore reinsurance, trades marketable securities, and provides healthcare administration and consultancy services.
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Ranhill (RANH MK; RM0.86) – SELL
FY10P/E: N/A, P/BV: 0.8x

• The stock is trapped in a descending triangle pattern. Although a strong rebound took place last Friday after rounds of consolidation, we think sustainability is a key concern here.
• It swung past both 30- and 50-day SMAs as well as its triangle resistance on intraday trades, but profit taking set in subsequently to keep prices below all these levels. This reflects that follow through momentum is weak.
• We believe unload on strength is probably the best option here as sellers are likely to surface near its key SMAs. Meanwhile support is at RM0.80 and RM0.76.

Ranhill Berhad is an investment holding company. The company, through its subsidiaries, provides engineering, procurement, construction, and project management services. Ranhill also has operation in power generation, engineering and installation of power distribution and generation facilities, manufactures switchgears and switchboards, and provides facilities
management service.