Stocks on Bursa Malaysia ended lower yesterday for second consecutive day on selling pressure in line with regional market performance amid concerns on US quantitative easing measures and weaker growth in China's manufacturing sector. The FBMKLCI fell 4.04 points or 0.22% to 1,794.65 after hovering between 1,790.94 and 1,797.89 throughout the day. Losers led gainers 519 to 258, with 313 counters unchanged. Total turnover fell to 2.32 billion shares valued at RM2.11 billion from 1.8 billion shares worth RM2.31 billion yesterday.
Following the weak performance on Wall Street overnight, the FBMKLCI opened 3.31 points lower at 1,795.38 and staged a weak rebound to the intra-day high of 1,797.89 within the first five minutes after opening. The key index fell from the high on continuous selling pressure which sent the index to the intra-day low of 1,790.94 at late morning. However, some buying surfaced in the afternoon session which pushed the index to close at the mid range of the day. Chart-wise, the FBMKLCI formed a black spinning-top candlestick which indicates indecision of market direction and waning of the prior selling pressure, with a mild upward bias as the index was able to close above the mid range of the day. Hence, the FBMKLCI may stage a rebound today if the buying support continue to come in.
MACD has again turned downward, but its histogram continued to contract upward, indicating a state of consolidation. RSI(14) slipped lower to 48.8 from 51.4, indicating the FBMKLCI has turned mildly bearish. Stochastic continued to rise to 54.9 from 49.6, indicating the short term up cycle is still intact. Mixed signals from the indicators showed that the FBMKLCI is in a state of consolidation.
The short term trend of the FBMKLCI still remained sideways as the key index continued to stay within the sideways range of 1,780 to 1,822. Nevertheless, the medium and longer term trend still remained up. For the immediate short term, the FBMKLCI is likely to stay sideways range bound as the market await fresh catalyst. Nonetheless, rotational play on the second and third liners are likely to continue.
Overnight, the Dow rose 109.17 points or +0.69% to close at a fresh record high of 16,009.99. Today, the FBM KLCI is likely to trade within a range of 1,784 to 1,804
This week's expected range: 1752 – 1831
Today’s expected range: 1784 – 1804
Resistance: 1798, 1801, 1804
Support: 1784, 1787, 1791
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