Stocks on Bursa Malaysia ended higher yesterday on gains in selected key heavyweights and water-related counters, sentiments was encouraged by Bank Negara’s positive economic projections that the economy would grow by between 4.5 and 5.5 per cent this year.
The FBM KLCI drifted sideways and moved within a tight range for most part of the day, late buying interest help push the index to close 3.03 points or 0.23% higher at 1312.48. Gainers led losers by 461 to 303 while 247 counters were unchanged. Volume increased to 1.244 billion shares worth RM1.845 billion.
The price action of the FBM KLCI yesterday formed a candlestick with small white body which indicates low volatility and consolidation, as it was forecasted in yesterday’s report. The consolidation indicated the benchmark index was probably waiting for some encouraging news to be announced next week during the investment conference or for the unveiling of the New Economic Model.
Technically, the indicators are turning positive with MACD continued to move up and the histogram are getting shorter, indicating the gradual pickup in market momentum. RSI(14) at 61 has started to turn bullish, while Stochastic has just crossed above its slow Stochastic indicating the beginning of an up cycle has just started.
The short term 5-day MA continued to turn up and is touching the 10-day MA, a cross above the 10-day MA would indicate a short term uptrend. The medium term 30-day MA continued to move higher indicating the medium term trend has changed from sideways earlier to now up, while the longer term trend remained up.
Today, the FBM KLCI is likely to trade within a range of 1306 to 1316.
This week's expected range: 1272 – 1331
Today’s expected range: 1306 – 1316
Resistance: 1314, 1315, 1316
Support: 1306, 1308, 1310
Stock to watch: Kencana, Dufu
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