FBM KLCI - like to further consolidate
Stocks
on Bursa Malaysia closed lower last Friday on selling by institutional
funds, amid weakness on oil and gas-related counters. The benchmark
FBMKLCI fell 2.02 points or 0.11% to close at 1,813.79 after hovering
between 1,808.7 and 1,814.57 throughout the day. Week-on-week, the key
index lost 10.4 points or 0.6% from previous Friday’s 1,824.19. Losers
led gainers by 548 to 235, with 315 counters unchanged. Total volume
decreased to 1.65 billion units worth RM1.6 billion from 1.69 billion
shares worth RM1.72 billion on Thursday. Weekly turnover fell to 9.95
billion units worth RM8.98 billion compared with previous week’s 11.201
billion shares valued at RM10.532 billion.
The
FBMKLCI was basically in an extended correction mode last week where it
moved in counter-trend with the performances on the Wall Street and
regional stock markets. The FBMKLCI staged a technical rebound on last
Monday where it opened 0.28 of a point higher at 1,824.24 and closed
3.74 points higher at 1,827.93, after hovering between 1,824.05 and
1,831.82 throughout the day on the back of favorable US jobs data which
points to solid growth in the world’s largest economy. The rebound on
Monday found no follow through on Tuesday and the key index fell 2.82
points to 1,825.11 after hitting an intra-week high of 1,832.70. The key
index continued to fall for the next three days to hit the intra-week
low of 1,808.70 on Friday before rebounding to close off low at
1,813.79, losing 10.4 points from previous Friday’s close of 1,824.19.
On the weekly chart, the FBMKLCI formed a black spinning-top candlestick which indicates consolidation and uncertainty of market direction but with a downward bias. Hence, the FBMKLCI is likely to continue to consolidate in the coming week. On the daily chart, the FBMKLCI formed a black hammer candlestick, a bottom reversal candlestick pattern which indicates buying support where the bears were initially strong in driving the index lower but the bulls fought back later to lift the index off. Hence, the FBMKLCI may stage a technical rebound if the buying momentum continues. Otherwise, the key index may continue to consolidate. Immediate downside support zone is at 1,808 to 1,800, with 1,800-point being the critical psychological support, while overhead resistance zone is at 1,815 to 1,825.
Weekly MACD continued to slide lower, while its histogram was just slightly lower or almost flat, indicating a state of consolidation. Daily MACD and its histogram continued to slide lower below the zero-line after making a dead-cross at midweek last week, indicating further loss in momentum and increased weakness. Weekly RSI (14) was lower at 42.8 from 45, indicating further loss of the index’s relative strength in the mildly bearish zone. Daily RSI (14) was lower at 42.1 from 43.1, indicating mild loss of the daily relative strength in the mildly bearish zone. Weekly Stochastic hooked downward gently to 56.1 from 56.4, indicating a pause in the stochastic weekly up cycle. However, daily stochastic continued to slip lower to 11.3 from 23.5, entering the short term oversold zone, indicating weakness in the key index and a technical rebound maybe expected. In short, readings from the weekly indicators showed that the FBMKLCI is in a state of consolidation, while readings from the daily indicators showed that the FBMKLCI is weak and oversold on the stochastic, and a technical rebound maybe expected on oversold rebound.
The general trend of the FBMKLCI still remained down and bearish as the key index continued to stay below the short, medium and long term moving averages. Nonetheless, the very long term trend of the FBMKLCI represented by the 500-day simple moving average (SMA) is still up. The key index breached the 400-day SMA on Friday but rebounded to close just slightly below it, indicating there are some long term buying supports at current level. The FBMKLCI also tested the 50% Fibonacci retracement support at 1,812 on Friday and rebounded to close above it, further strengthening the current support level at around 1,810. However, a further break of the current support zone at 1,808 to 1,812 will likely see the key index sliding lower to test the 61.8% Fibonacci retracement support at 1,801 and the 1,800-point psychological support level. For the coming week, the FBMKLCI is likely to stay in a consolidation mode with a downward bias in view of a lack catalyst that can propel the index higher.
Last Friday, the Dow fell 18.05 points or -0.10% to close at 17,634.74. This week, the FBMKLCI is likely to trade within a range of 1,780 to 1,856, and today, the FBMKLCI is likely to trade within a range of 1,804 to 1,820.
This week's expected range: 1780 – 1856
Today’s expected range: 1804 – 1820
Resistance: 1816, 1818, 1820
Support: 1804, 1806, 1810
Stocks
on Bursa Malaysia closed lower last Friday on selling by institutional
funds, amid weakness on oil and gas-related counters. The benchmark
FBMKLCI fell 2.02 points or 0.11% to close at 1,813.79 after hovering
between 1,808.7 and 1,814.57 throughout the day. Week-on-week, the key
index lost 10.4 points or 0.6% from previous Friday’s 1,824.19. Losers
led gainers by 548 to 235, with 315 counters unchanged. Total volume
decreased to 1.65 billion units worth RM1.6 billion from 1.69 billion
shares worth RM1.72 billion on Thursday. Weekly turnover fell to 9.95
billion units worth RM8.98 billion compared with previous week’s 11.201
billion shares valued at RM10.532 billion.The
FBMKLCI was basically in an extended correction mode last week where it
moved in counter-trend with the performances on the Wall Street and
regional stock markets. The FBMKLCI staged a technical rebound on last
Monday where it opened 0.28 of a point higher at 1,824.24 and closed
3.74 points higher at 1,827.93, after hovering between 1,824.05 and
1,831.82 throughout the day on the back of favorable US jobs data which
points to solid growth in the world’s largest economy. The rebound on
Monday found no follow through on Tuesday and the key index fell 2.82
points to 1,825.11 after hitting an intra-week high of 1,832.70. The key
index continued to fall for the next three days to hit the intra-week
low of 1,808.70 on Friday before rebounding to close off low at
1,813.79, losing 10.4 points from previous Friday’s close of 1,824.19.On the weekly chart, the FBMKLCI formed a black spinning-top candlestick which indicates consolidation and uncertainty of market direction but with a downward bias. Hence, the FBMKLCI is likely to continue to consolidate in the coming week. On the daily chart, the FBMKLCI formed a black hammer candlestick, a bottom reversal candlestick pattern which indicates buying support where the bears were initially strong in driving the index lower but the bulls fought back later to lift the index off. Hence, the FBMKLCI may stage a technical rebound if the buying momentum continues. Otherwise, the key index may continue to consolidate. Immediate downside support zone is at 1,808 to 1,800, with 1,800-point being the critical psychological support, while overhead resistance zone is at 1,815 to 1,825.
Weekly MACD continued to slide lower, while its histogram was just slightly lower or almost flat, indicating a state of consolidation. Daily MACD and its histogram continued to slide lower below the zero-line after making a dead-cross at midweek last week, indicating further loss in momentum and increased weakness. Weekly RSI (14) was lower at 42.8 from 45, indicating further loss of the index’s relative strength in the mildly bearish zone. Daily RSI (14) was lower at 42.1 from 43.1, indicating mild loss of the daily relative strength in the mildly bearish zone. Weekly Stochastic hooked downward gently to 56.1 from 56.4, indicating a pause in the stochastic weekly up cycle. However, daily stochastic continued to slip lower to 11.3 from 23.5, entering the short term oversold zone, indicating weakness in the key index and a technical rebound maybe expected. In short, readings from the weekly indicators showed that the FBMKLCI is in a state of consolidation, while readings from the daily indicators showed that the FBMKLCI is weak and oversold on the stochastic, and a technical rebound maybe expected on oversold rebound.
The general trend of the FBMKLCI still remained down and bearish as the key index continued to stay below the short, medium and long term moving averages. Nonetheless, the very long term trend of the FBMKLCI represented by the 500-day simple moving average (SMA) is still up. The key index breached the 400-day SMA on Friday but rebounded to close just slightly below it, indicating there are some long term buying supports at current level. The FBMKLCI also tested the 50% Fibonacci retracement support at 1,812 on Friday and rebounded to close above it, further strengthening the current support level at around 1,810. However, a further break of the current support zone at 1,808 to 1,812 will likely see the key index sliding lower to test the 61.8% Fibonacci retracement support at 1,801 and the 1,800-point psychological support level. For the coming week, the FBMKLCI is likely to stay in a consolidation mode with a downward bias in view of a lack catalyst that can propel the index higher.
Last Friday, the Dow fell 18.05 points or -0.10% to close at 17,634.74. This week, the FBMKLCI is likely to trade within a range of 1,780 to 1,856, and today, the FBMKLCI is likely to trade within a range of 1,804 to 1,820.
This week's expected range: 1780 – 1856
Today’s expected range: 1804 – 1820
Resistance: 1816, 1818, 1820
Support: 1804, 1806, 1810
Stocks to watch: ASUPREM, GDEX, INSAS, JIANKUN, MITRA, MYEG, QL, SILKHLD, SOLID, TEXCYCL, YEELEE
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