FBMKLCI broke above its downtrend line in the middle of March (see Chart 1). FBM70 lagged behind and only managed to break above its downtrend line in end March (see Chart 2).
Chart 1: FBMKLCI's daily chart as at Apr 9, 2015 (Powered by ShareInvestor.com)
Chart 2: FBM70's daily chart as at Apr 9, 2015 (Powered by ShareInvestor.com)
The better performance of FBMKLCI due to strong performance by the banking stocks. The Finance index recovered well after breaking above its downtrend line in January.
Chart 3: Finance's daily chart as at Apr 9, 2015 (Powered by ShareInvestor.com)
Another sector that has done very well is the technology sector. This can be seen in the sharp rally for Technology index (consisting of technology companies listed in the Main Market) and FBMACE (consisting of all the companies in the ACE market). The rally in the technology stocks is consistent with a similar rally in Nasdaq which is approaching the high recorded in February 2000. I may look into that story later.
Chart 4: Technology's daily chart as at Apr 9, 2015 (Powered by ShareInvestor.com)
Chart 5: FBMACE's daily chart as at Apr 9, 2015 (Powered by ShareInvestor.com)
In conclusion, our market is looking positive in the near term. It has shaken off concern about the impact of lowered crude oil prices and the on-again, off-again interest rate hike in the US and is now climbing up a wall of worries. I believe that there is still opportunity for market to go higher while at the same time, we have to be cautious and keep some cash on the sideline.
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