Stocks on Bursa Malaysia closed higher yesterday, lifted by gains in selected heavyweights. The benchmark FBMKLCI finished 4.96 points or 0.27% higher at 1,876.62 points, after fluctuating between 1,869.77 points and 1,878.67 points throughout the day. Market breadth was positive as gainers edged losers by 425 to 349, with 310 counters unchanged. Volume fell to 1.24 billion shares worth RM2.08 billion from Wednesday’s 1.37 billion shares worth RM2.07 billion.
The FBMKLCI opened 0.58 of a point higher at 1,872.24 and slipped to the intra-day low of 1,869.77 within the first ten minutes after opening. The key index rebounded from the low and moved higher gradually to hit the intra-day high of 1,878.67 at mid-afternoon before pulling back on profit-taking activity to close off high. Chart-wise, the FBMKLCI formed a bullish white candlestick which continues the rebound from Wednesday. Hence, the FBMKLCI is likely to move higher today if the buying momentum continues into today. Immediate overhead resistance is at 1,878, follows by 1,882 and 1,889, while the downside support zone is at 1,869 to 1,862.
MACD has turned upward and the histogram also contracted upward for a second bar, indicating a pickup in the bullish momentum. Nonetheless, as the MACD is still below the signal-line, current upswing may just be a technical rebound. RSI (14) was higher at 57.6 from 54, indicating an improvement of the index’s short term relative strength in the mildly bullish zone. Stochastic hooked upward to 45.8 from 35.4, and has made a golden-cross over the slow stochastic line, issuing a short term buy signal and indicated that the short term down cycle was probably over and the beginning of an up cycle. Readings from the indicators showed that the FBMKLCI has staged a rebound, and the bullish upward momentum is gradually picking up.
With the bullish upward move yesterday, the short term trend of the FBMKLCI has reversed up as the key index is now closing above all the short term moving averages, and the medium to long term uptrend still remained intact. With volume continued to drop lower, the broader market is likely to see more consolidation, but the index-linked counters may continue their uptrend as the month is coming to a close as funds window-dress.
Overnight, the Dow rose 65.56 points or 0.39% to close at 16,698.74. Today, the FBM KLCI is likely to trade within a range of 1,862 to 1,887.
This week's expected range: 1837 – 1912
Today’s expected range: 1862 – 1887
Resistance: 1880, 1883 1887
Support: 1862, 1866, 1871
Stocks to watch: ABRIC, AFG, ASB, DESTINI, EG, IJMPLNT, JADI, KNM, LBALUM, MMODE, MKH, OLYMPIA, PMETAL, SCICOM, SONA, WELLCAL
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