Stocks on Bursa Malaysia ended higher yesterday in line with the steadier regional markets. Market sentiment regionally was boosted by the expectation of more central banks likely to pledge new stimulus measures – especially China and European countries – in fighting off the effects of the economic slowdown, while the local market movement was influenced by gains in defensive stocks like banking, consumer and telecommunication-related sectors. The FBM KLCI advanced 11.72 points or 0.71% to an all-time-high of 1,661.47 after moving between the 1,649.66 and 1,662.14 levels throughout the day. Gainers beat losers by 400 to 298, while 364 counters were unchanged. Turnover rose to 965.118 million shares worth RM1.596 billion from the 864.828 million shares worth RM1.744 billion on Wednesday.
The FBM KLCI opened 0.09 of a point lower at the intra-day low of 1,649.66 and moved higher for the rest of the day with intermittent mild pullback correction, it touched a fresh new all-time-intra-day high of 1,662.14 at mid afternoon before closing at the all-time high of 1,661.47. Chart-wise, the FBM KLCI formed a bullish white candlestick which continued the uptrend after one day of profit-taking correction. It showed the bulls were in control, and the key index is likely to continue scaling new high with an immediate target of 1,672 to 1,675-point.
MACD and its histogram continued to move higher, indicating an increased in the bullish momentum. RSI (14) was higher at 64.1, indicating the short term relative strength of the FBM KLCI has turned bullish. Stochastic was higher at 97, indicating a very strong market strength and continuation of the up cycle, nevertheless, it is short term overbought and some pullback correction might be expected ahead. Readings from the indicators showed that the FBM KLCI is currently in a bullish state and the bullish momentum may send the key index to a higher level in the uncharted territory.
The trend of the FBM KLCI is up and bullish as it closed at a fresh all-time-high level and is above all the short, medium and long term moving averages. Immediate upside target is at 1,675-point level follows by a longer term target of 1,693 and 1,705. As the FBM KLCI continues to scale new, more profit-taking activity is also expected ahead as investors sell into strength to lock in their profits.
Overnight, the Dow rose 80.75 points or +0.60% to close at 13,575.36. Today, the FBM KLCI is likely to trade within a range of 1,640 to 1,675.
This week's expected range: 1564 – 1684
Today’s expected range: 1640 – 1675
Resistance: 1666, 1670, 1675
Support: 1640, 1645, 1653