Where is the KLCI headed to?

Where is the KLCI headed to?

The KLCI Index has been on a strong upturn since the early of this year which has been a great sight after what we experience for the past 3 years. 

Fundamentally KLCI has been supported by a stronger ringgit, the rebound of oil prices as well as better than expected economic growth. It has helped that these positive news has also coincided with the beginning of the year where typically large funds and  institutional investors would add into their portfolios after they have cashed-out their 2017 profits at end of December. Typically Jan is where a lot of buying activity happens. 

It hasn't been different this year and foreign buying has also been strong with the last 4 weeks particularly encouraging. 

There is nothing to not like if you are an investor but traders should continue to focus on the trend at hand.

End of last year we tracked the index and we expected a reversal which happened. We expected some resistance at the 12 month highs but as we mentioned earlier in this article, strong fundamentals likely pushed the index beyond where it should be tested.

Based purely on the momentum we do expect the index to hit the all-time high by May or even much earlier if market buying continues to be strong. Strong fundamentals means that if the event the market does lose some steam - it will likely be supported near the 1770-1800 levels. We would have to see some change in economic conditions or selling pressure for it to drop below this levels.

However at the current moment in time - we are somewhere between high-tide and low-tide. Its not too bad to buy in now but it wouldn't be where you can maximize you returns or at least expect to with the data is available. 

However if you are looking to invest in the KLCI this year (and we mean this for those who can hold beyond 6 months) - its a good time with the KLCI looking extremely friendly for 2018.

https://www.laburlah.com/single-post/2018/01/29/Where-is-the-KLCI-headed-to