Stocks on Bursa Malaysia closed lower yesterday, weighed down by losses in selected blue-chips and heavyweights amid a lack of fresh leads. The FBMKLCI eased 6.98 points or 0.37% to 1,871.36, after moving between 1,866.47 and 1,882.07 throughout the day. Loser thumped gainers by 515 to 349, with 319 counters unchanged. Total volume increased to 2.51 billion units valued at RM2.52 billion from 2.11 billion units valued at RM2.30 billion transacted on Wednesday.
The FBMKLCI rebounded to open 3.34 points higher at 1,881.68 and surged to the intra-day high of 1,882.07 right after opening. However, the rise could not sustain, and the key index slipped lower on persistent selling pressure for the rest of the day to hit the intra-day low of 1,866.47, losing 11.87 points at its worst, before rebounding to close off low. Chart-wise, the FBMKLCI formed a bearish black candlestick which continues the downtrend from Wednesday. Hence, the FBMKLCI is likely to further consolidate or slide lower today. Immediate downside support zone is at 1,867 to 1,860, while the overhead resistance zone is at 1,880 to 1,886.
MACD turned downward, and its histogram also extended southward after contracting upward for three consecutive sessions, indicating a resumption of the bearish momentum. RSI (14) plunged to 42.3 from 48.7, indicating heavy correction. Stochastic hooked downward to 29.9 from 35.4, and is about to touch the slow stochastic line, indicating a possible end to the short term up cycle or rebound. Readings from the indicators showed that the FBMKLCI is turning bearish after a mild rebound, and hence, is likely to further correct downward.
The short term trend of the FBMKLCI has again turned down as the key index is now closing below the 5, 10, 20 and 30-day SMA and also the medium term 50 and 60-day moving averages. Hence, the FBMKLCI is likely to further correct downward. The immediate critical downside support is at 1,867-point and a break of this immediate support will see the key index sliding lower toward the 1,860 and 1,850 zone. From Elliott wave analysis, the FBMKLCI is currently forming the corrective wave-C with a downside target of 1,850-point, a 100% wave-C projection, and follow by the 161.8% downside projection target of 1,833.
Overnight, the Dow fell 317.06 points or -1.88% to close at 16,563.36. Today, the FBM KLCI is likely to trade within a range of 1,848 to 1,897.
This week's expected range: 1857 – 1892
Today’s expected range: 1848 – 1897
Resistance: 1880, 1888, 1897
Support: 1848, 1857, 1864
Stocks to watch: APB, ASIAPAC, BCB, FAJAR, FITTERS, GOB, HANDAL, HEVEA, HUAYANG, KPSCB, MASTER, OPCOM, PRESBHD, SAPRES, SMISCOR, SUMATEC, SUNZEN, 3A
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