Stocks on Bursa Malaysia closed broadly higher yesterday in line with its regional peers as interest returned to Asian markets amid the crisis in Crimea and slowing growth in China. The FBMKLCI extended its earlier gains to close firmer yesterday, lifted by positive sentiment and persistent buying interests. The benchmark index rose 13.37 points or 0.73% to close at 1,833.85, after fluctuating between 1,821.03 and 1,834.23 throughout the day. Gainers outpaced losers by 428 to 370, while 322 counters were unchanged. Turnover rose to 1.94 billion shares worth RM2.01 billion from 1.75 billion shares worth RM3.12 billion on Friday.
The FBMKLCI opened higher with an upside gap of 1.2 points at 1,821.68 but slipped lower on profit taking to the intra-day low of 1,821.03 within the first fifteen minutes after opening. The key index rebounded strongly from the low and rally to the morning session high of 1,833.75, it pulled back on profit-taking activity and move sideways for a major part of the day to hit the intra-day high of 1,834.23 before closing slightly off high. Chart-wise, the FBMKLCI formed a bullish white Marubozu-like candlestick which indicates the bulls or buyers were in full control for the day, and hence, the FBMKLCI is likely to continue its uptrend to climb higher today. Immediate overhead resistance zone is at 1,838 to 1,850, while the downside support zone is at 1,821 to 1,811.
MACD has turned up and made a bullish cross-over the zero-line, indicating the key index has turned bullish. RSI (14) was higher at 56.7 from 49.5, indicating the short term relative strength of the FBMKLCI has turned mildly bullish from a mildly bearish state. Stochastic was higher at 59.4 from 44.2, indicating a strong improvement in the index’s strength and continuation of the short term up cycle. Readings from the indicators showed that the FBMKLCI is breaking out from its consolidation mode and showed signs of turning bullish.
The short term trend of the FBMKLCI has turned up with the strong upward move yesterday as the index is now closing above all the moving averages. Hence, the FBMKLCI is likely to continue its uptrend today to test the overhead resistance at 1,838, and a successful breakthrough will see the key index moving higher to challenge the psychological resistance level of 1,850 follow by the all-time-high level of 1,882.2. With volume traded greatly improved to 1.94 billion shares yesterday, the market has regained its momentum.
Overnight, the Dow fell 26.08 points or -0.16% to close at 16,276.69. Today, the FBM KLCI is likely to trade within a range of 1,811 to 1,847.
This week's expected range: 1789 – 1840
Today’s expected range: 1811 – 1847
Resistance: 1838, 1843, 1847
Support: 1811, 1816, 1825
Stocks to watch: ANCOM, CNOUHUA, DBHD, EUPE, FITTERS, GBGAQRS, GHLSYS, INSAS, KARYON, LONBISC, MINHO, OMEDIA
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