Stocks on Bursa Malaysia ended on a mixed note yesterday on mild selling pressure despite gains on regional markets except Japan’s Nikkei. The FBM KLCI, which opened at 1,625.33, fell by 0.04 point to close at 1,624.14 after hovering between 1,623.92 and 1,627.07 throughout the day. Advancers led decliners by 349 to 303 with 301 counters unchanged. Total volume rose to 895.99 million shares worth RM1.55 billion from 801.35 million shares worth RM1.37 billion on Tuesday.
Taking cue from the strong closing of the Dow overnight, the FBM KLCI opened 1.15 points higher at 1,625.33 and climbed gradually to the intra-day high of 1,627.07 at mid morning, and it slipped lower gradually on mild profit-taking to the intra-day low of 1,623.92 before rebounding slightly to close off low. Chart-wise, the FBM KLCI formed a small black inverted hammer-like candlestick with short shadows which indicates a state of consolidation amid mild profit-taking activity. Hence, the FBM KLCI is likely to continue to consolidate within a range of 1,621 to 1,630 with immediate overhead resistance zone at 1,627 to 1,635 while the downside support zone is at 1,622 to 1,611.
MACD and its histogram continued to move higher, indicating an increase in the upward momentum. Nevertheless, as MACD is still below the zero-line, the current upward move is likely to be part of a technical rebound. RSI (14) was almost flat at 43.05 from 43.07 before, indicating the short term relative strength of the FBM KLCI is still in the mildly bearish state. Stochastic was higher at 69.6 from 65.7, indicating a continuation of the short term up cycle. Readings from the indicators showed that the FBM KLCI is still in a state of consolidation but the short term reading is improving to be less bearish.
The short term trend of the FBM KLCI is now sideways as the index is sandwiched between the 10 and 20-day SMA with the 10-day SMA at 1,622 acting as immediate support while the 20-day SMA at 1,625 acting as the immediate resistance. The 200-day SMA is now at 1,628 while the 240-day SMA is at 1,621. With the medium term moving averages acting as overhead resistance while the long term moving averages acting as downside support, the FBM KLCI is likely to continue to stay range-bound for the immediate term within a range of 1,600 to 1,650.
Overnight, the Dow rose 175.24 points or +1.26% to close at 14,075.37. Today, the FBM KLCI is likely to trade within a range of 1,619 to 1,630.
This week's expected range: 1574 – 1660
Today’s expected range: 1619 – 1630
Resistance: 1626, 1628, 1630
Support: 1619, 1621, 1623
Stocks to watch: CENSOF, KSL, MKH, PERISAI, SUNWAY, TEBRAU