Stocks on Bursa Malaysia closed lower yesterday on profit-taking activities especially in blue-chip counters. The benchmark FBMKLCI fell 9.95 points or 0.54% to close at 1,818.6 after moving between 1,813.49 and 1,827.33 points throughout the day. Market breadth was negative with losers outpacing gainers by 438 to 334, while 332 counters were unchanged. Volume rose to 1.71 billion shares worth RM2.21 billion from 1.689 billion shares valued at RM2.05 billion on Tuesday.
Taking cue from the losses on Wall Street overnight, the FBMKLCI opened 1.22 points lower at 1,827.33, the intra-day high level, and plunged lower on heavy profit-taking activity to hit the intra-day low level of 1,813.49 within the first twenty minutes after opening. The key index rebounded from the low and moved higher gradually to partially reclaim some of the losses. Chart-wise, the FBMKLCI formed a bearish black candlestick which closed below the mid-range of the day, indicating selling pressure were dominant. Hence, the FBMKLCI is likely to continue to consolidate today within the immediate sideways range of 1,813 to 1,838.
MACD and its histogram continued to slide lower, indicating further loss in momentum. RSI (14) was lower at 46.9 from 52.2, indicating the key index has turned mildly bearish for the short term. Stochastic was lower at 37.8 from 55.9, indicating further weakening of the key index and continuation of the short term down cycle. Readings from the indicators showed that the FBMKLCI is turning mildly bearish for the short term, and hence, is likely to extend its consolidation.
The short term trend of the FBMKLCI still remained sideways range-bound with a bearish bias as the index was closing at the lower half of the sideways range of 1,813 to 1,838, and a further break of the immediate strong support at 1,813 will see the FBMKLCI sliding lower to retest the critical psychological support level of 1,800-point. The FBMKLCI is also closing below most of the short and medium term moving averages and is sitting right above the 30-day SMA, and a close below the 30-day SMA will trigger further selling pressure on the key index. Nevertheless, the long term uptrend is still intact at the moment.
Overnight, the Dow fell a marginal 11.17 points or -0.07% to close at 16,340.08. Today, the FBM KLCI is likely to trade within a range of 1,798 to 1,841.
This week's expected range: 1792 – 1863
Today’s expected range: 1898 – 1841
Resistance: 1826, 1833, 1841
Support: 1798, 1805, 1812
Stocks to watch: ACME, KNM, KSSC, MMSV, OCNCASH, OSK, PADINI, SWSCAP, TDEX, YEELEE, YLI
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