FBM KLCI - higher on follow through rebound
Stocks
on Bursa Malaysia finished higher yesterday on renewed buying interests
by local investors. At close, the benchmark FBMKLCI stood at 1,699.95,
up 18.05 points or 1.07%, after opening 6.13 points higher at 1,688.03.
Gainers trounced losers by 761 to 180, while 193 counters were
unchanged. Total volume fell to 1.91 billion units worth RM1.93 billion
from 1.94 billion units worth RM2.06 billion on Wednesday.
Taking cue from the bullish performance of
Wall Street overnight, the FBMKLCI opened 6.13 points higher at 1,688.03
and touched the intra-day low of 1,688.00 briefly after opening. The
key index rebounded and rallied higher to 1,704 at noon, and pulled back
to move sideways range-bound in the afternoon session. The FBMKLCI hit
the intra-day high of 1,704.85 at mid-afternoon before profit-taking
activity in the last hour dragged it to close below the 1,700-point
psychological level. Chart-wise, the FBMKLCI formed a bullish white
candlestick which continued the rebound from Wednesday, and it also
covered the downside gap formed on Tuesday, making the gap an exhaustion
gap, indicating that the sell-down on FBMKLCI has temporary exhausted
and the bottom was seen at 1,671.82. Hence, the FBMKLCI is likely to
continue its rebound to move higher today. Immediate overhead resistance
zone is at 1,704 to 1,715, while the downside support zone is at 1,688
to 1,671.
MACD was marginally lower and tapered off, while its histogram contracted upward, indicating a big reduction in the bearish momentum. RSI (14) was higher at 33.4 from 26.8, indicating a strong technical rebound which pulled the key index from a very bearish state to the bearish state. Stochastic rose to 8.01 from 2.5, and has made a golden-cross over the slow stochastic line, issuing a stochastic buy signal. Readings from the indicators showed that the FBMKLCI was staging a technical rebound after hitting the extremely oversold zone, and is likely to continue rising higher on follow through buying.
The general trend of the FBMKLCI still remained down. However, with yesterday’s bullish upward move, the key index has close above the immediate near term 5-day simple moving average (SMA), indicating an initial changed in the immediate near term trend from down to up. Nonetheless, to change to a short term uptrend the key index must at least close above the 10-day SMA which is currently at 1,722-point level. In order to reverse the current downtrend the FBMKLCI must close above the cluster of moving average resistance zone with the highest resistance level at 1,847 posted by the 180-day SMA, which is still a long way to go.
Overnight, the Dow rose 421.28 points or 2.43% to close at 17,778.15. Today, the FBMKLCI is likely to trade within a range of 1,673 to 1,722.
This week's expected range: 1685 – 1800
Today’s expected range: 1673 – 1722
Resistance: 1707, 1714, 1722
Support: 1673, 1680, 1690
MACD was marginally lower and tapered off, while its histogram contracted upward, indicating a big reduction in the bearish momentum. RSI (14) was higher at 33.4 from 26.8, indicating a strong technical rebound which pulled the key index from a very bearish state to the bearish state. Stochastic rose to 8.01 from 2.5, and has made a golden-cross over the slow stochastic line, issuing a stochastic buy signal. Readings from the indicators showed that the FBMKLCI was staging a technical rebound after hitting the extremely oversold zone, and is likely to continue rising higher on follow through buying.
The general trend of the FBMKLCI still remained down. However, with yesterday’s bullish upward move, the key index has close above the immediate near term 5-day simple moving average (SMA), indicating an initial changed in the immediate near term trend from down to up. Nonetheless, to change to a short term uptrend the key index must at least close above the 10-day SMA which is currently at 1,722-point level. In order to reverse the current downtrend the FBMKLCI must close above the cluster of moving average resistance zone with the highest resistance level at 1,847 posted by the 180-day SMA, which is still a long way to go.
Overnight, the Dow rose 421.28 points or 2.43% to close at 17,778.15. Today, the FBMKLCI is likely to trade within a range of 1,673 to 1,722.
This week's expected range: 1685 – 1800
Today’s expected range: 1673 – 1722
Resistance: 1707, 1714, 1722
Support: 1673, 1680, 1690
Stocks to watch: AIRASIA, BORNOIL, EDUSPEC,
EURO, GHLSYS, HUAYANG, INARI, KPS, L&G, NAIM, NIHSIN, REDTONE,
SCICOM, SUCCESS, SYSTECH, TEKSENG, VS
Disclaimer: The content on this site is
provided as general information only and should not be taken as
investment advice. All site content, shall not be construed as a
recommendation to buy or sell any security or financial instrument. The
ideas expressed are solely the opinions of the author. The Stocks to
watch is not a recommendation to buy or sell the particular stock, as it
is only meant for graduates of the "Share Trading the Pro Way" course
as case study. Any action that you take as a result of information,
analysis, or commentary on this site is ultimately your responsibility.
Consult your investment adviser before making any investment decisions.
http://millionairetrendtrader.blogspot.com
