Stocks on Bursa Malaysia closed mixed yesterday with the benchmark FBMKLCI continued gains into the fourth consecutive day, lifted by buying interest in selected blue chips. The benchmark index which opened lower, finished at an intra-day high of 1,846.87, rising 7.73 points or 0.42%, after hitting an intra-day low of 1,836.11. Losers led gainers by 416 to 387, while 306 counters were unchanged. Turnover slipped to 2.05 billion shares worth RM2.05 billion from 2.08 billion shares worth RM1.97 billion on Wednesday.
Taking cue from the overnight losses on Wall Street, the FBMKLCI opened 3 points lower at 1,836.14 and slipped lower briefly to the intra-day low of 1,836.11 after opening. The key index rebounded from the low and move sideways in a narrow range in and out of the positive and negative territory throughout the day, and a last minute buying on selected blue-chips pushed the key index to close at the highest point of the day. Chart-wise, the FBMKLCI formed a bullish white Marubozu candlestick which indicates the strong hands were in full control of the day. Hence, the FBMKLCI is likely to continue its uptrend to move higher in conjunction with the closing of the first quarter. Immediate overhead resistance zone is at 1,850 to 1,862, while the downside support zone is at 1,836 to 1,828.
MACD and its histogram were both higher, indicating a further increase in the index’s momentum. RSI (14) was higher at 62.9 from 59.3, indicating the key index has turned bullish from a mildly bullish state before. Stochastic was higher at 98 from 93.4, indicating very strong index strength but is short term overbought, and hence, a pullback correction might be expected. Readings from the indicators showed that the FBMKLCI is turning bullish, and is likely climb higher on continued bullish momentum. Nonetheless, it is overbought on the Stochastic reading, and a pullback is expected.
The short term trend of the FBMKLCI has turned up and bullish as the key index has now breakout from its short term sideways range of 1,811 to 1,838, and is likely to climb higher to challenge the overhead resistance zone of 1,850 to 1,882. Nevertheless, the medium term trend is still sideways range-bound within a larger range of 1,769 to 1,882. The long term uptrend remained intact. With the FBMKLCI turning bullish and the volume maintaining around 2 billion shares, the market is likely to see more rotational play.
Overnight, the Dow fell a marginal 4.76 points or -0.03% to close at 16,264.23. Today, the FBM KLCI is likely to trade within a range of 1,830 to 1,845.
This week's expected range: 1789 – 1840
Today’s expected range: 1830 – 1845
Resistance: 1841, 1843, 1845
Support: 1830, 1832, 1835
Stocks to watch: ANCOM, CAP, CNOUHUA, GBGAQRS, KIMLUN, KFM, MERGE, MMSV, NYLEX, OCK, OKA, REDTONE, SALCON, SOLID
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