Stocks on Bursa Malaysia closed mixed yesterday with the benchmark FBMKLCI finished higher, helped by buying interests in selected heavyweights. The FBMKLCI rose 4.34 points or 0.23% to 1,869.21 after moving between 1,860 and 1,869.21 throughout the day. Market breadth was negative with losers outpacing gainers by 430 to 390 while 352 counters were unchanged. Total volume rose to 2.51 billion shares worth RM2.11 billion from 2.99 billion shares worth RM2.104 billion on Wednesday.
The FBMKLCI opened 1.79 points higher at 1,866.66 and surged higher to 1,867.27 briefly after opening, but the rise could not sustain and the key index fell on heavy profit-taking activity to hit the intra-day low of 1,860 in the next forty minutes. The FBMKLCI rebounded from the low and moved higher gradually for the rest of the day and a last minute buying of selected blue-chips pushed the key index to close at the highest point of the day. Chart-wise, the FBMKLCI formed a bullish white hammer candlestick, a bullish bottom reversal candlestick which indicates a change from supply to demand. Hence, the FBMKLCI is likely to move higher today if the buying momentum continues into today. Immediate overhead resistance zone is at 1,872 to 1,879, while the immediate downside support zone is at 1,860 to 1,853.
MACD hooked upward gently, and its histogram also extended upward, indicating an initial change in momentum from down to up. However, further confirmation is needed. RSI (14) hooked upward to 50.3 from 47.2, indicating a change in the index’s short term relative strength from mildly bearish to neutral. Stochastic was almost flat at 54.9 from 54.8, indicating a pause in the short term down cycle and a mild rebound. Mixed readings from the indicators showed that the FBMKLCI is in a state of consolidation with mild bullish bias.
The short term trend of the FBMKLCI has turned sideways range-bound as the key index continue to fluctuate within the near term range of 1,853 to 1,879. The medium term trend of the FBMKLCI is also sideways with a larger range of 1,839 to 1,896. Nevertheless, the longer term trend is still up. As the week is approaching the weekend, the market is likely to trade more cautiously with profit-taking on stocks that has risen over the last few days. Rotational play on small caps and penny stock is still alive but the momentum has reduced.
Overnight, the Dow fell 8.70 points or -0.05% to close at 17,069.58. Today, the FBM KLCI is likely to trade within a range of 1,853 to 1,878
This week's expected range: 1837 – 1899
Today’s expected range: 1853 – 1878
Resistance: 1872, 1875, 1878
Support: 1853, 1856, 1863
Stocks to watch: ARANK, BJAUTO, CENSOF, DNEX, EAH, FITTERS, GBGAQRS, HEVEA, KANGER, KPJ, KPS, LBALUM, MELEWAR, MIECO, PJDEV, PMBTECH, SCICOM, TEKSENG
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