Stocks on Bursa Malaysia closed mixed yesterday with the benchmark index staying in positive territory, help by late buying on selected key heavyweights. The FBM KLCI opened higher boosted by strong overnight gains on Wall Street; it touched the intra-day high of 1342.06 in the early hour but heavy profit-taking activities sent the key index into the negative territory and drifted sideways before late buying lifted it to close 2.94 points or 0.22% higher at 1338.83. Losers outpaced gainers by 406 to 293 while 298 counters were unchanged. Volume traded was higher at 1.044 billion shares worth RM1.637 billion, with KNM alone contributed almost sixteen percent to the total volume.
Chart wise, the FBM KLCI formed a Doji candlestick with long lower shadow, which indicates uncertainty in the direction of the key index. The price action of the benchmark index yesterday indicated heavy selling pressure when the index comes into the resistance zone above 1340. The index was trapped in a sideways range for the last five days and is expected to continue doing so.
MACD continued to move lower indicating the loss in positive momentum of the index. RSI(14) at 64.22 continued to move higher, is still in the bullish zone. Stochastic at 68.86, however, continued to move lower indicating the correction mode is still in place.
The 5-day moving average (MA) has crossed below the 10-day MA, but the index is above both MAs indicating short term sideways consolidation of the key index. The medium and long term trend is still up.
The FBM KLCI is now trapped in a trading range of 1331 to 1344, supported below at 1331 and capped on top at 1344; a break in either one direction could mean a move in the direction of the breakout.
Today, the FBM KLCI is likely to trade within a range of 1327 to 1350.
This week's expected range: 1312 – 1363
Today’s expected range: 1327 – 1350
Resistance: 1343, 1346, 1350
Support: 1327, 1330, 1334
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