With sentiment affected by Dow’s 249 points decline on last Friday and weak performances of regional bourses, the FBM KLCI opened on Monday with a down gap of 5.06 points at 1238.17 and rapidly moved down to the intra-day low of 1233.45 but recovered to stay above the support of 1237 most of the day, and close at the high of the day at 1241.76, day-on-day it was down 1.47 point or 0.12%. Decliners led advancers by 410 to 240 with 212 counters traded unchanged. Volume stood at 1.0739 billion shares, was healthy.
As mentioned in yesterday’s report, the 30-days simple moving average (SMA) provided the needed support for the KLCI at 1234 level, and investors start to pickup quality stock at this level after the benchmark index declined more than 30 points from its recent high of 1270. The index may have seen a temporary bottom yesterday as it formed a hammer-like candlestick.
MACD and its histogram continue to slide further indicating the weakening of momentum; RSI(14) at 53 is neutral and Stochastics(14,3,3) at 26 is near oversold and may stage a rebound. For the short term, the index may trap in a consolidation mode with immediate support at 1233 and resistance at 1256.
Today, the index is expected to trade within the range of 1236 to 1250 with immediate support at 1239 and 1236, and overhead resistance at 1245, 1247 and 1251.
This week's expected range: 1200 – 1271
Today's expected range: 1236 – 1251
Resistance: 1245, 1247, 1251
Support: 1233, 1236, 1239
Stock to watch: NOTION
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