Inspired by overnight’s gain on Wall Street, the local market opened with a positive note yesterday, but ended broadly lower on profit taking. The FBM KLCI charted an intra-day high of 1288.42, heavy profit taking activities sent the index into the negative territory at one stage to hit the day’s low of 1275.62. Late buying of key heavyweights lifted the key index off low to close at 1279.95, the highest close of the year, gaining 1.64 point or 0.13%. Decliners outnumbered advancers by 438 to 251 while 261 counters were traded unchanged. Turnover was lower at 1.044 billion shares worth RM1.271 billion.
The price action of the FBM KLCI yesterday formed a black Spinning Top candlestick with a slightly longer upper shadow, indicating selling pressure at level above 1280. The Spinning Top indicates indecision of the market to move higher at this level. Other indicators remain positive with MACD, RSI and Stochastic continued to move higher. If the key index can overcome the strong overhead resistance at 1289, then it may move higher to test the next important psychological resistance level of 1300.
Today, the FBM KLCI is expected to trade within the range of 1268 to 1294.
This week's expected range: 1250 – 1299
Today's expected range: 1268 – 1294
Resistance: 1283, 1289, 1294
Support: 1268, 1273, 1276
Stock to watch: Dayang
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