Stocks on Bursa Malaysia ended broadly lower on heavy profit-taking activities yesterday, in tandem with weakness in regional markets and losses on Wall Street overnight. The FBM KLCI fell 12.16 points or 0.9% to close at 1332.93 after twelve consecutive days of gains. Market breadth was negative with losers outpaced gainers by 476 to 239 while 292 counters were unchanged. Volume traded increased to 1.278 billion shares worth RM1.737 billion.
Chart wise, the FBM KLCI opened with a down gap of 2.68 points and traded lower for the rest of the day and closed near the day’s low to form a bearish black candlestick. A gap down near the top is not a good thing as it reflected a panic situation and the rushing out of players from the market, which also reflected through the increase in trading volume. The benchmark index is expected to get some support at the 1330 level which coincides with the 10-day moving average (MA) support.
MACD has turned south and the histogram has also turned shorter reflecting the slow down in upward momentum, nonetheless, the MACD is still in the positive or bullish territory. RSI(14) at 63.10 made a sharp turn and is back to the bullish zone form the very bullish or overbought zone. Stochastic at 88.4 has crossed below its slow Stochastic, is still above the 80 mark or the overbought zone. Signals from the indicators reflected the correction mode of the key index.
The FBM KLCI has now comes below the 5-day MA, but is still above the 10-day MA, some buying support is expected near the 1330 level which was a resistance turned support area. If this level couldn’t hold, then the index will come down to test the support zone of 1310 to 1320. The underlying short, medium and long term trend is still up.
The benchmark index may continue to correct or consolidate while the second and third may continue to be in a rotational play mode, this short term correction should be viewed as an opportunity to accumulate quality stocks at lower price level.
Today, the FBM KLCI is likely to trade within a range of 1318 to 1346
This week's expected range: 1297 – 1361
Today’s expected range: 1318 – 1346
Resistance: 1336, 1340, 1346
Support: 1318, 1325, 1329
No comments:
Post a Comment