Share prices on Bursa Malaysia completed its correction on last Monday, Nov 2 after hitting an intra-day low of 1233.45. Thereafter, the FBM KLCI recovered its lost ground gradually to close last week at 1260.76. Week-on-week, the KLCI posted a gain of 17.53 points or 1.41%. Volume increase substantially from 4.7394 to 6.6622 billion shares traded, mainly generated by the lower liners.
Technically, from the weekly chart perspective, the KLCI uptrend is still intact, supported very well by the 10-weeks moving average. Weekly RSI and Stochastic are bullish, MACD, however, is showing a weakening in upward momentum. The immediate overhead resistance lies at the recent high of 1270.44, if it can be broken convincingly, then KLCI may move to test the next target of 1300 before the year end.
Let’s now take a look at the picture on the daily chart.
On the daily chart, a strong gain of 203 points on the Dow overnight has help the FBM KLCI to open on Friday, Nov 6, with a gap up of 6.11 point at 1260.07. Thereafter, the KLCI has been moving in a very narrow range of about 3 point between 1260 and 1263. Intra-day movement of the KLCI indicated active profit taking activities on the FBM KLCI component stocks as the index slid gradually down after hitting the intra-day high of 1263.03 to close the day at 1260.76, forming a small body candlestick with a longer upper shadow, this type candlestick formation indicated low volatility and a lack of upward momentum.
MACD continued to move upward, but the histogram is still in negative territory. RSI and Stochastic also continue to move upward indicating a gradual gain in market strength. Uptrend is intact as indicated by all the short, medium and long term moving averages.
This week, the FBM KLCI is expected to trade within a range of 1240 to 1282, and today, it is expected to trade within a range of 1254 to 1267.
This week's expected range: 1240 – 1282
Today's expected range: 1254 – 1267
Resistance: 1263, 1265, 1267
Support: 1254, 1256, 1259
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