Stocks on Bursa Malaysia ended marginally higher in mixed trading yesterday bolstered by gains seen in selected heavyweights led by Petronas Gas and Tenaga. The uncertainty over the outcome of the ECB meeting later yesterday and the lack of fresh stimulus by the US Fed kept some investors on the sideline. The FBM KLCI was 0.98 point higher at 1,633.45 after moving between 1,630.43 and 1,635.43. Losers led gainers by 465 to 303, while 346 counters closed unchanged. Volume eased to 1.175 billion shares worth RM1.647 billion from 1.354 billion shares valued at RM1.864 billion on Wednesday.
The FBM KLCI opened 0.83 of a point higher at 1,633.30 and climbed to the intra-day high of 1,635.43 within the first forty minutes of trading. The key index then retreated on profit-taking activity to hit the intra-day low of 1,630.43 near noon and continued to move range bound to close off low. Chart-wise, the FBM KLCI formed a Doji candlestick which indicates indecision of market direction amid consolidation as it moved in a tight range. Hence, the benchmark index is likely to continue moving sideways range-bound today with immediate overhead resistance zone at 1,635 to 1,641, and downside support zone at 1,630 to 1,626.
MACD was marginally lower, but its histogram was shorter upward, indicating a consolidation mode with an upward bias. RSI (14) was marginally higher at 59.9, indicating a mild improvement in the short term relative strength to the upper end of the mildly bullish zone. Stochastic was higher at 43.2 from 41.9, indicating a slight improvement in the market strength and continuation of the short term up cycle. Readings from the indicators showed that the FBM KLCI is currently in a consolidation mode with an upward bias as shown by the gradual improvement in the momentum.
The short term trend of the FBM KLCI is currently sideways while the medium and longer term trend is still up. A breakout above 1,635 will likely see the key index moving higher to re-test the 1,641-point resistance level, while a break below 1,630 will see the key index sliding lower to the critical support level of 1,620. With volume remained low, the market is likely to see more rotational play on the third liners while the heavyweights consolidate.
Overnight, the Dow fell -92.18 points or -0.71% to close at 12,878.88. Today, the FBM KLCI is likely to trade within a range 1,625 to 1,641.
This week's expected range: 1593 – 1666
Today’s expected range: 1625 – 1641
Resistance: 1636, 1638, 1641
Support: 1625, 1628, 1630
Stocks: HIBISCS, WELLCAL, NAIM, UOADEV