Stocks on Bursa Malaysia closed lower yesterday with interest subdued due to lack of buying support in the absence of clear signals from overseas equity markets, as buyers are not participating aggressively in the market with foreign investors reducing their holdings gradually. The FBMKLCI ended 2.06 points or 0.11% lower at 1,828.68, after moving between 1,826.53 and 1,833.80 throughout the day. Losers led gainers by 446 to 432, with 283 counters unchanged. Volume rose to 3.06 billion shares worth RM2.08 billion, from 2.98 billion shares worth RM2.39 billion, recorded on Friday.
The FBMKLCI opened 0.7 of a point higher at 1,831.44 and surged to the intra-day high of 1,833.80 within the first fifteen minutes after opening. However, the rise could not be sustained, and the key index came under heavy profit-taking activity which sent it to the intra-day low of 1,826.53 at mid- afternoon. The index rebounded slightly in the last hour on bargain hunting activity to close off low. Chart-wise, the FBMKLCI formed a black spinning-top candlestick pattern in dark-cloud-cover position, a candlestick formation which indicates uncertainty of market direction amid profit-taking activity with a bearish bias. Hence, the FBMKLCI is likely to continue its sideways range-bound consolidation today within the immediate range of 1,820 to 1,833.
MACD continued to rise, but its histogram further contracted, indicating further loss in momentum and entering into a state of consolidation. RSI (14) hooked downward to 55.9 from 57.3, indicating the short term relative strength of the FBMKLCI is still in a mildly bullish state. Stochastic hooked downward slightly to 92.5 from 93.6, reflecting a mild pullback correction. Readings from the indicators showed that the FBMKLCI is in a state of consolidation, and the consolidation is likely to extend until a breakout is seen.
The technical picture of the FBMKLCI remained unchanged with the short and medium term in sideways range-bound, while the long term trend still remained up. Nonetheless, judging from the high trading volume, the small-cap and penny stocks will continue with their rotational play and the heavyweight blue-chips consolidate.
Overnight, the Dow rose 103.84 points or +0.64% to close at 16,207.14. Today, the FBM KLCI is likely to trade within a range of 1,818 to 1,841.
This week's expected range: 1808 – 1847
Today’s expected range: 1818 – 1841
Resistance: 1833, 1837, 1841
Support: 1818, 1822, 1825
Stocks to watch: AZRB, CCM, CRESBLD, EVERGRN, EFORCE, GADANG, HEVEA, LBALUM, LBS, MMSV, RSAWIT, SUCCESS, XINQUAN
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