FBM KLCI - higher for the fifth day

Stocks on Bursa Malaysia ended higher yesterday on continued buying interest in selected blue chips and lower liners. The FBM KLCI rose for the fifth consecutive days to close 3.22 points or 0.24% higher at 1358.41, another new high for this year. Gainers led losers by 386 to 345 while 279 counters were unchanged. Volume increased to 999 million shares valued at RM1.481 billion from 847 million shares worth RM1.251 billion on Wednesday.

The FBM KLCI opened 0.59 point higher at 1355.78 but traded lower to the intra-day low of 1353.16 on profit-taking activities before rebounding to the intra-day high of 1359.27, and selling pressure continued to surface which pulled it to close off high at 1358.41. The benchmark index formed a bullish white candlestick which indicates continuation of the current uptrend, and may continue to move higher to challenge the overhead resistance zone at 1360 to 1380.

MACD continued to move higher indicating the upward momentum is intact. RSI(14) at 69.9 continued to climb higher, is turning very bullish but will soon be overbought. Stochastic at 93.5 is in the short term overbought situation, and has started to hook down, indicating an impending correction may soon to take place. From the reading of the indicators, the FBM KLCI is currently in a bullish state, but may run into a possible correction.

The FBM KLCI is currently above all its short, medium and long term moving averages (MA) which indicates a bullish state of the key index. The short term 5 and 10-day MA are trending up strongly will continue to provide immediate support to the current uptrend at 1345 to 1352. The longer term uptrend remained intact.

Overnight, the Dow closed -30.72 points or -0.29% lower at 10,467.16. Today, the FBM KLCI is likely to trade within a range of 1348 to 1365.

This week's expected range: 1316 – 1375
Today’s expected range: 1348 – 1365

Resistance: 1361, 1363, 1365
Support: 1348, 1351, 1355

Stock to watch: Time, Timecom, Waseong

FBM KLCI - closing on 2 years new high

Stocks on Bursa Malaysia ended higher yesterday lifted by finance related stocks. The FBM KLCI rose 2.96 points or 0.22% to close at 1355.19, a new high since the rally started in April 2009. Gainers led losers by 445 to 264 while 278 counters were unchanged. Volume increased to 847 million shares worth RM1.251 billion from 731 million shares valued at RM1.33 billion on Tuesday.

The FBM KLCI opened 0.42 point higher at 1352.65 and traded lower to the intra-day low of 1350.62 on profit-taking activities, later in the morning buying interest in finance related stocks help pushed the key index to the intra-day high of 1356.13. Profit-taking activities continued to trimmed gain and the index close off high at 1355.15. The key index formed a bullish white candlestick which indicates continuation of the uptrend and the key index is expected to continue moving higher to challenge higher targets in the overhead resistance zone of 1360 to 1375.

MACD continued to move higher indicating the continuation of upward momentum. RSI(14) at 68.5 continued to move higher and remained bullish. Stochastic at 93.9 has hooked downward, but remained above its slow stochastic, and continued to stay in the overbought zone indicating the key index is still strong.

The FBM KLCI is currently above all its short, medium and long term moving averages (MA). The short term 5 and 10-day MA will continue to provide immediate support to the current uptrend at 1342 to 1348. The medium term trend is sideways as indicated by the 60-day MA, while the long term uptrend remained intact.

Overnight, the Dow closed -39.81 points or -0.38% lower at 10,497.88. Today, the FBM KLCI is likely to trade within a range of 1346 to 1362.

This week's expected range: 1316 – 1375
Today’s expected range: 1346 – 1362

Resistance: 1357, 1359, 1362
Support: 1346, 1348, 1351

Stock to watch: L&G, MBSB, E&O

FBM KLCI - higher with formation of Doji

Stocks on Bursa Malaysia ended mixed yesterday with the benchmark index finishing in positive territory above the critical 1350 psychological resistance level. The FBM KLCI added 0.41 point or 0.03% to close at 1352.23, after opening 0.65 point higher at 1352.47. Losers led gainers by 381 to 308 while 285 counters were unchanged. Volume declined to 731 million shares valued at RM1.33 billion from 850 million shares worth RM1.122 billion on Monday.

The FBM KLCI opened 0.65 point higher and surged to an intra-day high of 1357.23 within the first hour. Heavy profit-taking activities set in and sent the key index down to the intra-day low of 1348.29 before bargain hunting activities lifted it to close marginally higher at 1352.23. This formed a Doji candlestick on the chart which indicates the bull and the bear are equally strong and indecision of the market to move higher after a day of battle. This could signal a possible top, however, it still requires a confirmation. Immediate overhead resistance level is now at 1357 and the support is at 1348.

MACD continued to climb higher, indicating an increase in upward momentum. RSI(14) at 67 has tapered off, however, is still in the bullish zone. Stochastic at 95.7 is moving higher, but is short term overbought, and a possible correction may set in. Signals from the indicators are pointing toward a bullish state of the FBM KLCI, and it is expected to climb higher with intermittent mild correction on profit-taking activities.

The benchmark FBM KLCI is now above all the short, medium and long term moving averages, indicating a bullish state of the key index. The short and long term trends are up, while the medium term trend is sideways. Immediate overhead resistance zone now lies at 1355 to 1383, while the immediate support zone is at 1340 to 1345 provided by the short term 5 and 10-day MA.

Overnight, the Dow closed +12.26 points or +0.12% higher at 10,537.69. Today, the FBM KLCI is likely to trade within a range of 1339 to 1366.

This week's expected range: 1316 – 1375
Today’s expected range: 1339 – 1366

Resistance: 1357, 1361, 1366
Support: 1339, 1344, 1348

Stock to watch: MEASAT, OFI

FBM KLCI - closing above 1350!

Stocks on Bursa Malaysia ended mixed yesterday as investors took profit after earlier gains, while the benchmark index charted a new high for this year. The FBM KLCI rose 6.14 points or 0.46% to close at 1,351.82, after opening 4.86 points higher at 1350.54. Losers led gainers by 355 to 336 while 274 counters were unchanged. Volume declined to 850 million shares worth RM1.122 billion from 993 million shares valued at RM1.430 billion last Friday.

The FBM KLCI opened with an up gap of 4.86 points at 1350.54, and surged to the intra-day high of 1352.94 before profit-taking activities sent it down to the intra-day low of 1348.58, however, continued buying interest on selected blue-chips managed to lift the benchmark index to close above the psychological resistance of 1350 after three earlier attempts this year. Chart-wise, it formed a white spinning-top candlestick which indicates the bull and the bear was in a close fight, nevertheless, the bull has an upper hand. The key index may continue its momentum to move higher to test the next target at 1360.

MACD continued to climb higher, indicating the rise in upward momentum. RSI(14) at 66.9 continued to move higher and is bullish. Stochastic at 93.3 is short term overbought, nonetheless, it indicates the key index is very strong. Signals from the indicators are pointing toward a bullish state of the FBM KLCI, and it is expected to climb higher with intermittent pull-back on profit-taking.

The benchmark FBM KLCI is now staying above all the short, medium and long term moving averages, indicating a bullish state of the key index. The short and long term trends are up, while the medium term trend is sideways. Immediate overhead resistance zone now lies at 1355 to 1383, while the immediate support zone is at 1330 to 1340.

With positive news that most European banks had passed the stress tests coupled with better-than-expected US corporate earnings, it helped ease investor worries over the strength of the global economic recovery. Locally, the continued announcements of corporate results which are expected to be encouraging will help boost the market to move higher.

Overnight, the Dow closed +100.81 points or +0.97% higher at 10,525.43. Today, the FBM KLCI is likely to trade within a range of 1345 to 1360.

This week's expected range: 1316 – 1375
Today’s expected range: 1345 – 1360

Resistance: 1353, 1355, 1360
Support: 1345, 1347, 1349

Stock to watch: Airasia, Tebrau, L&G

FBM KLCI - turning bullish

Stocks on Bursa Malaysia closed broadly higher last Friday taking cue from the strong gains on Wall Street last Thursday. The FBM KLCI gained 9.63 points or 0.72% to close the week at 1345.68. Week-on-week, it gained 9.03 points from 1,336.65 the previous Friday. Total volume for the week rose to 4.175 billion shares worth RM6.527 billion from 3.4 billion shares worth RM5.937 billion the previous week.

The FBM KLCI was in a choppy mode last week. It opened last Monday on a weak note and traded lower to hit the intra-week low of 1327.98, but rebounded on Tuesday. It continued to move higher on Wednesday but faced strong profit-taking activities when it touched the intra-day high of 1344.96. The key index corrected downward on Thursday, losing 4.97 points to 1336.05, and rebounded strongly on Friday to close the week at its highest point at 1345.68.

On the weekly chart, the FBM KLCI formed a bullish continuation candlestick, in which the benchmark index was closing higher for the third consecutive weeks, and it is likely to continue its upward swing to move higher to re-test the psychological resistance level at 1350 this week. As pointed out in last Monday’s analysis, a firm breakout from the 1350 level will bring the key index to a medium to longer term target of 1450.

On the daily chart, the FBM KLCI formed a bullish white Marubozu candlestick, which indicates the Bulls or buyers were in control for the day, and the key index is now staying above all the short, medium and long term moving averages, hence, is expected to continue its upward momentum. The key index is expected to face strong resistance when it comes close to the 1350 psychological resistance level.

Weekly MACD continued to curve upward, albeit still below its weekly signal line but is approaching it, and the histogram is turning shorter indicating a gradual pick up in the medium term upward momentum. Daily MACD has hooked up, indicating a pick up in short term upward momentum, and in fact, it is in a bullish state.

Weekly RSI(14) is at 61.8, and continued to move higher into the bullish zone, indicating the medium term market strength is turning strong. Daily RSI(14) at 64.1 is also in the bullish zone.

Weekly Stochastic at 86.4, is picking up strongly from a reading of 74.4 last week, indicating the medium term price momentum is very strong and is entering the medium term overbought zone. Daily Stochastic at 91.6 has hooked up, is also very strong and continued to remain in the overbought zone. Signals from the indicators are pointing towards a bullish outlook for the benchmark FBM KLCI.

The FBM KLCI is currently staying above all its short, medium and long term moving averages (MA), indicating a bullish state of the key index. The short term trend is up, while the medium term trend is sideways as indicated by the medium term MAs, nonetheless, the long term trend remained up.

Immediate strong resistance is expected at the 1350 psychological level, if this level is penetrated successfully, the next resistance level is at 1357 and 1363. Immediate support zone for the key index is now at 1330 to 1340.

The announcement of corporate results which will peak next month will continue to give support to the local market, while on the external side, the fewer-than-expected European banks that failed the stress tests is expected to help boost overseas markets.

The Dow gained +102.32 points or +0.99% higher to close at 10,424.62 on last Friday. This week, the FBM KLCI may trade within a range of 1316 to 1375, and for today it is likely to trade within a range of 1337 to 1351.

This week's expected range: 1316 – 1375
Today’s expected range: 1337 – 1351

Resistance: 1347, 1349, 1351
Support: 1337, 1339, 1342

Stock to watch: POS, HEXZA

FBM KLCI - correction

Stocks on Bursa Malaysia ended broadly lower yesterday with heavy selling of heavyweight finance and plantation counters. The FBM KLCI ended 4.97 points or 0.37% easier at 1,336.05, after trading between a range of 1,332.92 and 1,339.98 points. Losers outnumbered gainers by 388 to 318 while 251 counters were unchanged. Turnover was lower at 872 million shares worth RM1.145 billion, compared with 874 million shares worth RM1.268 billion, registered on Wednesday.

The FBM KLCI opened with a 1.94 point down gap and traded lower to hit the intra-day low of 1332.92. Bargain-hunting activities in late afternoon lifted the key index to close off low at 1336.05. The price action of the key index formed a bearish black candlestick which is a confirmation to the reversal signal from the shooting-star candlestick formed the day before. The key index rebounded off the 10-day moving average (MA) after hitting it, and managed to close above the immediate support at 1335.

MACD has curved downward with its histogram turning shorter, indicating a slow down in the upward momentum. RSI(14) at 59.4 has hooked downward and moved into the mildly bullish zone. Stochastic at 88.5 has turned flat and remained in the overbought zone. Signals from the indicators are mixed, hence, the key index may go sideways.

The short term trend of the FBM KLCI remained up as indicated by the 10 and 30-day MA which is pointing upward. The medium term trend is likely to move sideways, as indicated by the 60-day MA which is lying flat, while the long term trend remained up. The FBM KLCI is expected to be in a range-bound mode with overhead resistance zone at 1340 to 1350, while immediate support zone remained at 1320 to 1330.

Overnight, the Dow closed +201.77points or +1.99% higher at 10,322.30. Today, the FBM KLCI is likely to trade within a range of 1326 to 1347.

This week's expected range: 1300 – 1360
Today’s expected range: 1326 – 1347

Resistance: 1339, 1343, 1347
Support: 1326, 1329, 1332

FBM KLCI - shooting star reversal signal

Stocks on Bursa Malaysia ended broadly higher yesterday on sustained buying interest in blue-chips, as investors sentiment was shored up by the firm close on Wall Street. Consumer stocks were in focus while some banking counters remained among the favorites on expectation of strong second quarter growth. The FBM KLCI rose 3.35 points or 0.25% higher to close at 1,341.02, but off the intra-day high of 1,345. Gainers outnumbered losers by 442 to 298 while 277 counters were unchanged. Turnover was lower at 874 million shares worth RM1.268 billion compared with 1.126 billion shares worth RM1.321 billion on Tuesday.

The FBM KLCI opened with a 2.71 points up gap and surged to the intra-day high of 1344.96, the up move was capped by active profit-taking activities which sent the key index down to the intra-day low of 1338.83 before last minute buying lifted it to close at 1341.02. The price action leads to the formation of a shooting-star like candlestick which is a top reversal signal. This goes to show that the key index faces strong resistance when it enters the resistance zone at 1340 to 1350. Immediate support zone now lies at 1320 to 1330.

MACD continued to move higher, while its histogram was flat, indicating the upward momentum remained intact. RSI(14) at 63.4 continued to inch higher into the bullish zone. Stochastic at 88 has crossed above its slow stochastic, indicates that the market strength remained strong.

The FBM KLCI is currently staying above all the short and long term moving averages, which will give support to the key index to move higher. Hence, there is a good likelihood that the key index may re-test the 1350 psychological resistance.

The FBM KLCI is expected to continue tracking the performance of regional key indexes due to a lack of fresh leads locally. Overnight, the Dow closed -109.43 points or -1.07% lower at 10,120.53. Today, the FBM KLCI is likely to trade within a range of 1330 to 1351.

This week's expected range: 1300 – 1360
Today’s expected range: 1330 – 1351

Resistance: 1344, 1347, 1351
Support: 1330, 1335, 1338

Stock to watch: NYLEX

FBM KLCI - reversed up

Stocks on Bursa Malaysia rebounded yesterday underpinned by bullish external factors including Wall Street's recovery. The FBM KLCI ended 4.32 points better at 1,337.67 after opening 1.18 points higher at 1,334.532, with continuous buying interest focused on selected heavyweights and lower liners. Gainers outnumbered losers by 466 to 278 while 250 counters were unchanged. Turnover rose to 1.126 billion shares worth RM1.321 billion compared with 848 million shares worth RM1.330 billion on Monday.

The FBM KLCI opened with 1.18 points up gap and traded higher, it touched the intra-day high of 1338.68 and experienced profit-taking which actually kept the key index fluctuating in a narrow range, however, last minute buying of selected heavyweights managed to lift the index to close higher at 1337.67. The price action of the key index formed a bullish white candlestick which confirmed the bottom reversal signal generated by the hammer candlestick formed on Monday. The FBM KLCI may hence continue to move higher today to re-test the recent high of 1341.96. If it is able to clear this resistance level, it may then continue moving higher to test the important psychological resistance at 1350.

MACD continued to move higher but at a slower pace as indicated by its shorter histograms, indicating the current upward momentum is not strong. RSI(14) at 61.7 has hooked up and is back to the bullish zone. Stochastic at 87.2 has hooked up and remained in the overbought zone, indicating short term up cycle is still intact.

The FBM KLCI is now staying above all the short, medium and long term moving averages which will give support to the key index to move higher. The short term trend of the key index is now up, while the medium term trend is sideways and the long term trend remained up.

In view of the increase in trading volume to above 1 billion shares, the market is expected to pick up in momentum. The FBM KLCI is expected to continue tracking the performance of regional key indexes due to a lack of fresh leads locally.

Overnight, the Dow closed +75.53 points or +0.74% higher at 10,229.96. Today, the FBM KLCI is likely to trade within a range of 1330 to 1345.

This week's expected range: 1300 – 1360
Today’s expected range: 1330 – 1345

Resistance: 1339, 1341, 1345
Support: 1330, 1333, 1335

FBM KLCI - formation of Hammer candlestick

Stocks on Bursa Malaysia ended mixed yesterday with key heavyweights mostly in correction mood while second and third liners chalk up gains. The FBM KLCI ended 3.30 points or 0.25% lower at 1,333.35 after fluctuating within the negative territory throughout the day. Sentiment was weighed down by the 261 points fall of the Dow. Gainers led losers by 327 to 324 while 269 counters were unchanged. Volume rose to 848 million shares worth RM1.330 billion, from 793 million shares worth RM1.196 billion registered on last Friday.

The FBM KLCI opened 2.73 points lower at 1333.92 and traded in the negative territory throughout the day, with sentiments weighed down by the 261 points sharp drop of the Dow last Friday. The key index lost 8.67 points when it hit the intra-day low of 1327.98 but rebounded gradually to close near the opening level, forming a hammer candlestick on the daily chart. The formation of hammer candlestick indicates buying support and a possible bottom during correction. Immediate overhead resistance zone is at 1335 to 1350, while the support zone remained at 1300 to 1320.

MACD continued to move higher but tapering off, while the histogram continued to turn shorter, indicates the waning of the upward momentum. RSI(14) at 59 has moved lower into the mildly bullish zone, while Stochastic at 84.7 continued to stay in the overbought zone and has crossed below its slow stochastic line. Signals from the indicators point towards a correction mode of the FBM KLCI.

Currently, the FBM KLCI is undergoing short term correction after the recent run up from 1294 and the short term trend remained up. Medium term trend is likely to be range-bound, while the long term trend is still up with the upward momentum gradually waning off.

In view of a lack of market moving impetus, the FBM KLCI is likely to continue tracking the performance of regional benchmark indexes. Overnight, the Dow closed +56.53 points or +0.56% higher at 10,154.43. Today, the FBM KLCI is likely to trade within a range of 1323 to 1340.

This week's expected range: 1300 – 1360
Today’s expected range: 1323 – 1340

Resistance: 1335, 1338, 1340
Support: 1323, 1326, 1330

FBM KLCI - likely to be range-bound

Stocks on Bursa Malaysia closed broadly higher last Friday on mild bargain-hunting activities as investors responded to the government's subsidy cut program announced on last Thursday night. The FBM KLCI rose 2.57 point or 0.19% to close the week at 1336.65. Week-on-week, it posted a gain of 12.34 points or 0.93% compared with 1324.31 the previous Friday. Total volume for the week rose to 3.40 billion shares worth RM5.94 billion from 2.81 billion shares worth RM5.02 billion the previous week.

The FBM KLCI staged a follow through rebound last week. It opened last week at 1323.91 and briefly touched the intra-week low of 1323.55 on last Monday. It rebounded quickly and moved up to hit the intra-week high of 1341.96 on Wednesday, however, profit-taking activities set-in quickly to curb gain. The key index corrected 7 points downward on Thursday but rebounded to re-coup some lost ground on Friday.

On the weekly chart, the FBM KLCI formed a bullish white candlestick and managed to close above the immediate resistance level at 1335. It formed a triangle on the weekly chart which is a continuation pattern that indicates correction and consolidation. A breakout from this pattern supported by good volume will bring the key index to the target of 1450, technically, in the medium to longer term perspective.

On the daily chart, the key index experienced a pull-back after touching the intra-week high of 1341.96, it was supported immediately by the short term 5-day moving average (MA), and is staying above the 10 and 30-day MA, which indicates the current short term trend is up. The key index is now staying in the resistance zone of 1330 to 1350, it will need to breakout from this zone before it can move higher. The underlying medium term trend is sideways as indicated by 60-day MA while the long term trend remained up, however, they are tapering off, indicting the slow down in long term upward momentum.

Weekly MACD continued to move higher marginally as indicated by its shorter histogram, nonetheless, it is still below its signal line, indicating the weekly upward momentum has not really pick up yet. Daily MACD, however, is in the bullish state. Weekly RSI(14) at 59.98 is moving into the bullish zone. Daily RSI(14) at 62 has hooked up and remained in the bullish zone. Weekly Stochastic at 74 continued to move higher, indicating the medium term cycle remained up. The daily Stochastic at 90 is in the overbought zone, and has hooked downward reflecting the current pull-back of the key index.

The government's subsidy cuts for petrol, diesel, liquefied petroleum gas, diesel and sugar effective last Friday is expected to have minimal impact on consumption patterns in the short term, and the less-than-aggressive cuts in subsidies will not translate into any impact on business sectors most exposed to consumer demand. In fact, the move will help improve the economy in the long run. As there is still no major catalyst that can move the market, it is expected that the FBM KLCI will continue to be range-bound between 1300 and 1350.

The Dow loss -261.41 points or -2.52% lower to close at 10,097.90 on last Friday. This week, the FBM KLCI may trade within a range of 1300 to 1360, and for today it is likely to trade within a range of 1327 to 1341.

This week's expected range: 1300 – 1360
Today’s expected range: 1327 – 1341

Resistance: 1337, 1339, 1341
Support: 1327, 1331, 1334

FBM KLCI - down on correction

Stocks on Bursa Malaysia took a breather yesterday after seven successive days of run up since Tuesday last week. The FBM KLCI was in a correction mood throughout the day, it lost 7 points or 0.52% to close at 1334.08 after opening 1.5 points lower. Losers beat gainers by 390 to 242 while 289 counters were unchanged. Volume dropped to 619 million shares valued at RM1.128 billion from previous day’s 801 million shares worth RM1.538 billion.

The FBM KLCI opened 1.5 points lower at 1339.58 and traded lower throughout the day. It hit the intra-day low of 1331.20, but last minute buying of selected blue-chips help lift the key index off low to close at 1334.08, forming a bearish black candlestick which covered the gap it formed the day before. Hence, the gap formed yesterday is an exhaustion gap which was the last push for distribution, and the key index is expected to correct downward further. Immediate support level is expected at 1330 and 1326.

MACD is higher but is tapering-off, as shown by the shorter histogram, indicating a loss in upward momentum. RSI(14) at 60.8 has hooked downward and Stochastic at 93 too has hooked downward, both reflecting the correction that the key index is undergoing.

The short term trend is up as indicated by the 5 and 10-day moving average (MA), medium term trend is sideways while the long term uptrend remained intact, however, the long term MAs are converging, which indicates a loss in long term upward momentum. The key index is still having problem in overcoming the immediate overhead resistance zone at 1340 to 1350. Immediate support zone lies at 1305 to 1320.

Overnight, the Dow closed -7.41 points or -0.07% lower at 10,359.31. Today, the FBM KLCI is likely to trade within a range of 1321 to 1349.

This week's expected range: 1283 – 1360
Today’s expected range: 1321 – 1349

Resistance: 1339, 1344, 1349
Support: 1321, 1326, 1330

FBM KLCI - higher with a continuation gap

Stocks on Bursa Malaysia ended firmer across the board, lifted by buying interest as investors anticipate a string of good corporate results starting yesterday. The FBM KLCI rose for seventh consecutive days, it gained 8.21 points or 0.62% to close at 1,341.08, after opening 3.78 points higher at 1,336.65. Gainers outpaced losers by 506 to 194 while 269 counters were unchanged. Total volume surged to 801 million shares worth RM1.538 billion from 574 million shares worth RM1.085 billion previously.

The FBM KLCI opened with an up gap of 3.78 points at 1336.65, above the resistance at 1335. It surged to the intra-day high of 1341.96 within first hour of trading, and profit-taking activities set in to send it lower to 1338 before last hour buying bring it back to close near the high at 1341.08. It formed a bullish white candlestick which indicates continuation of the uptrend. The benchmark index is expected to face strong resistance as it comes close to the 1347 to 1350 resistance zone, some pull-back is expected before it continues to move higher.

MACD continued to climb higher, indicating a continuation of the upward momentum. RSI(14) at 66 continued to move higher and has entered the bullish zone. Stochastic at 93 indicates the market strength is very strong but has entered the short term overbought zone. Signals from the indicators point to a continuation of current short term uptrend.

The main hurdle for the FBM KLCI now is the 1350 psychological resistance level, which it failed to cross in the last three attempts since April 2010. If the index is able to cross this resistance level convincingly, it might be able to reach the higher target level of 1380 before year end.

Overnight, the Dow closed +3.70 points or +0.04% higher at 10,366.72. Today, the FBM KLCI is likely to trade within a range of 1333 to 1350

This week's expected range: 1283 – 1360
Today’s expected range: 1333 – 1350

Resistance: 1343, 1346, 1350
Support: 1333, 1337, 1339

Stock to watch: XDL

FBM KLCI - higher for sixth days on lower volume

Stocks on Bursa Malaysia ended higher yesterday with the benchmark FBM KLCI closing higher for sixth consecutive days, gaining 6.13 points or 0.46% to close at its highest point for the day at 1,332.87. The FBM KLCI bucked key regional markets where sentiment was dampened by reports Beijing will not relax tougher property measures any time soon. Gainers led losers by 363 to 284 while 289 counters were unchanged. Total volume slipped to 574 million shares valued at RM1.085 billion from 610 million shares worth RM990 million on Monday.

The FBM KLCI opened 3.13 points higher at 1,329.87, and surged to the morning session high of 1331.54, and then it slid to the intra-day low of 1328.71 on profit-taking activities. A last minute buying of selected blue-chips pushed the key index to close at the highest point for the day forming a small body white candlestick, which indicates a low volatility day and the bull is very much in control. It is expected to continue moving higher into the overhead resistance zone of 1335 to 1350.

MACD continued to move higher, indicating the building up of positive momentum. RSI(14) at 62.6 continued to climb higher, and has entered the bullish zone. Stochastic at 85 continued to surge higher, and has entered the short term overbought zone. Signals from the indicators are indicating that the key index is getting more bullish.

Short term trend of the FBM KLCI has turned up as indicated by the 5 and 10-day MA, and medium term trend is still sideways, while the long term trend remained up. Immediate resistance zone is at 1335 to 1350, while the support zone is at 1305 to 1320.

Overnight, the Dow closed +146.75 points or +1.44% higher at 10,363.02. Today, the FBM KLCI is likely to trade within a range of 1325 to 1340

This week's expected range: 1283 – 1360
Today’s expected range: 1325 – 1340

Resistance: 1334, 1336, 1340
Support: 1325, 1327, 1330

FBM KLCI - higher amids profit taking

Stocks on Bursa Malaysia ended on a firmer note yesterday, with gains in selected heavyweights as investors took cue from an improved Wall Street last week. The FBM KLCI ended 2.43 points or 0.18% higher to close at 1326.74 after touching an intra-day high of 1331.74. Gainers led losers by 371 to 265 while 277 counters were unchanged. Volume declined to 610 million shares worth RM990 million from last Friday's 664 million shares worth RM1.44 billion.

The FBM KLCI opened 0.4 point lower at 1323.91 and surged to the intra-day high of 1331.74 in the morning session before profit-taking activities sent it lower in the afternoon to close at 1326.74. The price action of the key index formed a shooting-star like candlestick which indicates heavy profit-taking when the index entered the resistance zone at 1330 to 1350, nonetheless, it still make some progress.

MACD continued to move higher after making a golden-cross, indicating the upward momentum is in force now. RSI(14) at 59.5 continued to move higher and is about to move into the bullish zone. Stochastic at 70 continued to move higher, indicating the short term up cycle remained intact.

The key index is now staying above all the short, medium and long term moving averages (MA), indicating a bullish condition. The short term 5-day MA has just crossed above the 10-day MA, hence, the index is expected to continue to move higher. The short term trend of the FBM KLCI has turned upward; the medium term trend remained sideways as indicated by the medium term MAs, while the long term trend is still up. Overhead resistance zone is at 1330 to 1350 with immediate strong resistance at 1335. Immediate support zone is at 1305 to 1315.

Overnight, the Dow closed +18.24 points or +0.18% higher at 10,216.27. Today, the FBM KLCI is likely to trade within a range of 1315 to 1339

This week's expected range: 1283 – 1360
Today’s expected range: 1315 – 1339

Resistance: 1331, 1335, 1339
Support: 1315, 1319, 1323

FBM KLCI - turning positive

Stocks on Bursa Malaysia ended last week on a positive note with sentiment boosted by gains on Wall Street and confidence over economic growth. The FBM KLCI rose by 8.28 points or 0.63% to close at 1,324.31 on last Friday, lifted by gains on banking stocks following the increase in Overnight Policy Rate by 25 basis points to 2.75% on last Thursday. The key index gained 16.87 points or 1.29%, week-on-week, to 1,324.31 compared with 1,307.44 the previous Friday. Weekly turnover decreased to 2.808 billion shares valued at RM5.018 billion compared with 3.024 billion shares worth RM4.822 billion the previous week.

The FBM KLCI opened last Monday on a weak note and traded lower. It hit the intra-week low of 1294.37 on Tuesday, but reversed strongly in late afternoon to close at the day’s high. From there, the key index continued to move higher for the next three days to touch the intra-week high of 1327.27 on Friday, nonetheless, profit-taking activities set-in which trimmed gains, and the key index finally settled the week at 1324.31. On the weekly chart, the benchmark index formed a bullish piercing-line candlestick, which is a bottom reversal pattern. With this, the key index is expected to move higher to possibly re-test the 1350 psychological resistance level. It will, however, encounter strong resistance at the 1330 to 1350 zone. Immediate support zone lies at 1305 to 1315 levels.

Weekly MACD has stopped falling and turned flat with the histogram turning shorter, this indicates that the medium term downward momentum is waning off. On the daily chart, the daily MACD has made a golden-cross, signifying the short term momentum has turned positive. Weekly RSI(14) at 57.5 has hooked up, and is moving back into the mildly bullish zone from the neutral zone last week. Daily RSI(14) at 58.3 continued to move higher towards the bullish zone. Weekly Stochastic at 71 continued to move higher, indicating a continuation of the up cycle.

Last week, we mentioned that the FBM KLCI was in the process of forming the bearish Head-and-shoulder chart pattern. If in the coming weeks the key index is able to move higher and break above the 1335 and 1350 levels, then the threat of forming a bearish Head-and-shoulder pattern would be removed.

The FBM KLCI is now staying above all the short, medium and long term moving averages. It will continue to move higher to challenge the higher target levels, with immediate target at 1335 and the following critical target at 1350. If the key index is able to break above the 1350 resistance level, it has a potential to reach 1380.

In view of the rate hike which would help boost bank’s earnings, and given the positive market sentiment, the key index is expected to gain further this week. The Dow gained +59.04 points or +0.58% higher to close last Friday at 10,198.03 for a fourth consecutive days. This week, the FBM KLCI may trade within a range of 1283 to 1360, and for today it is likely to trade within a range of 1311 to 1339.

This week's expected range: 1283 – 1360
Today’s expected range: 1311 – 1339

Resistance: 1329, 1334, 1339
Support: 1311, 1317, 1322

FBM KLCI - up on weak momentum

Stocks on Bursa Malaysia ended higher yesterday as investors took the cue from the strong overnight close on Wall Street. The FBM KLCI closed 4.28 points or 0.33% higher at 1316.03 lifted by gains in selected heavyweights. Gainers led losers by 365 to 242 while 275 counters remained unchanged. Volume decreased slightly to 532 million shares but the value increased to RM971 million compared with 539 million shares worth RM919 million on Wednesday.

The FBM KLCI opened with an up gap of 2.87 points higher at 1,314.62 and surged to the intra-day high of 1317.05 before profit-taking activities sent it down to the intra-day low of 1312.95, and a last minute buying of selected heavyweights managed to lift the benchmark index to close higher at 1316.03 forming a Spinning-top candlestick, which indicates hesitation of the market to move higher. It indeed reflected the selling pressure encountered when the index moved into the resistance zone.

The benchmark index is now above the short term 5 and 10-day moving average (MA), and is also above the medium term 60-day MA, and it is expected that they will give support to the index to move higher. Nonetheless, it is faced with the immediate strong overhead resistance zone at 1320 to 1335. Immediate support zone is at 1300 to 1308.

MACD had turned upward, but still below its signal-line, indicating the current up-move may be a technical rebound and has not gain full strength yet. RSI(14) at 53.7 continued to move higher into the mildly bullish zone. Stochastic at 42 had just made a golden-cross above its slow Stochastic, indicating a short term up-cycle has just begun. Signals from the indicators are pointing towards a possible continuation of the current short term uptrend.

The short term trend of the FBM KLCI has turned upward; the medium term trend remained sideways as indicated by the medium term MAs, while the long term trend is still up.

Overnight, the Dow closed +120.71 or +1.20% higher at 10,138.99. Today, the FBM KLCI is likely to trade within a range of 1308 to 1323.

This week's expected range: 1260 – 1341
Today’s expected range: 1308 – 1323

Resistance: 1318, 1320, 1323
Support: 1308, 1311, 1314

FBM KLCI - continue moving higher

Stocks on Bursa Malaysia ended mixed yesterday with the benchmark index bucking regional trends on late buying of selected heavyweights by local funds. The FBM KLCI closed 4.67 points or 0.36% higher at 1,311.75, after opening 1.11 point lower. Losers led gainers by 307 to 275 while 272 counters were unchanged. Volume dropped to 539 million shares worth RM919 million compared with 622 million shares valued at RM970 million on Tuesday.

The FBM KLCI opened 1.11 point lower at 1305.97 and was drifting in the negative territory for most part of the day in a tight range. Buying interest surfaced in late afternoon pushed the benchmark index back to positive territory, and a last minute buying of selected heavyweights helped pushed the index to close near the high of the day. The price action of the key index formed a bullish white candlestick that closed at the high of the day, indicating buyers were in control, hence, the index is expected to move higher today. The key index has now closed above the 5-day moving average (MA), indicating a change in the immediate short term trend from down to up. The key index, however, is still below the 10 and 60-day MA which will post as a resistance to the up move.

MACD continued to move lower but has tapered off, and its histogram has turned shorter, indicating a slow down in the downward momentum and a possible change in direction. RSI(14) at 51 continued to move higher and is back into the mildly bullish zone. Stochastic at 26 has turned up but is still below its slow Stochastic, giving an early signal to the possible end of the current short term down cycle. Signals from the indicators point to a possible change in the short term trend of the benchmark index from down to up.

The FBM KLCI is reversing its immediate short term trend from down to up, nonetheless, it is capped with an immediate overhead resistance zone at 1315 to 1320. Immediate support zone is at 1295 to 1300.

In view of a lack of market moving factors locally, the key index is expected to continue taking cue from the performance of regional bourses. Overnight, the Dow closed +274.66 or +2.82% higher at 10,018.28. Today, the FBM KLCI is likely to trade within a range of 1299 to 1320.

This week's expected range: 1260 – 1341
Today’s expected range: 1299 – 1320

Resistance: 1315, 1318, 1320
Support: 1299, 1302, 1307

FBM KLCI - higher on technical rebound

Stocks on Bursa Malaysia rebounded yesterday after sliding for six consecutive days, taking cue from the rebound in regional bourses. The FBM KLCI closed 7.58 points or 0.6% higher at 1307.08, after opening 2.19 points lower at 1297.31. Gainers outnumbered losers by 406 to 195 while 272 counters remained unchanged. Volume increased to 622 million shares valued at RM970 million, against Monday's 449 million shares worth RM717 million.

The FBM KLCI opened 2.19 points lower at 1297.31 and traded upward gradually in the morning session albeit in the negative territory. The benchmark index turned positive in the afternoon session and rallied to close near the highest point for the day, forming a bullish engulfing candlestick, which is a strong bottom reversal signal. It should continue its upward move today; however, it may encounter strong overhead resistance at the 1315 to 1320 level. Its immediate support lies at 1300 to 1304, provided by the 30 and 120-day MA respectively.

MACD continued to slide lower, indicating the downward momentum is still in force. RSI(14) at 48 has hooked up, but is still in the bear zone. Stochastic at 21 has reached the short term oversold level, is tapering off, and might stage a technical rebound.

Even though the FBM KLCI staged a rebound yesterday, nonetheless, the benchmark index is still in a short term downtrend, and the rebound could be short-live. However, the longer term uptrend still remained intact.

In view of a lack of market moving impetus at the local front, the key index is expected to continue taking cue from the performance of regional bourses. Overnight, the Dow closed +57.14 or +0.59% higher at 9,743.62. Today, the FBM KLCI is likely to trade within a range of 1290 to 1319.

This week's expected range: 1260 – 1341
Today’s expected range: 1290 – 1319

Resistance: 1311, 1315, 1319
Support: 1290, 1298, 1303

FBM KLCI - closed below 1300

Stocks on Bursa Malaysia ended mostly lower yesterday in line with most regional markets on mounting concerns about slowdowns in the United States and China. The FBM KLCI suffered six days of straight losses to close 7.94 points or 0.61% lower at 1299.50 as the market came under selling pressure in the late afternoon. Losers outpaced gainers by 425 to 182 while 270 counters were unchanged. Volume dropped to 449 million shares worth RM717 million compared with 626 million shares worth RM974 million last Friday.

The FBM KLCI opened 1.93 point lower and traded in a narrow range in the morning session, however, selling pressure that surfaced in late afternoon pushed the key index lower to close below the psychological support level of 1300 at 1299.50 after hitting the intra-day low of 1298.14. The benchmark index is now below the 120-day moving average (MA), but is supported by the 30-day MA in a fragile position. A break below the 30-day MA at 1298 will see the index moving lower to test the 200-day MA support at 1284.

MACD continued to slide lower after crossing below its signal-line, indicating the downward momentum is picking up pace. RSI(14) at 43 fell lower into the bearish zone, indicating the bear is taking control. Stochastic at 22.5 continued to slide lower, indicating the down cycle is picking up strength. Signals from the indicators point towards a bearish outlook for the benchmark index and more downside is expected ahead for the benchmark index, FBM KLCI.

The current short term trend of the FBM KLCI has turned southward, while the long term trend as indicated by the 200 and 240-day MA is still up. Nonetheless, the long term MAs are converging, which indicates the loss in long term upward momentum, a danger sign in the brewing. The outlook for the FBM KLCI is now bearish.

Wall Street was closed for their national holiday. Today, the FBM KLCI is likely to trade within a range of 1288 to 1309.

This week's expected range: 1260 – 1341
Today’s expected range: 1299 – 1313

Resistance: 1302, 1305, 1309
Support: 1288, 1293, 1296

Stock to watch: TGOFFS

FBM KLCI - formation of Head-and-shoulder pattern

Stocks on Bursa Malaysia suffered five consecutive days of losses last week, in line with the weak performances of regional markets following a negative spate of news on the global economic front, and concerned with China's economy after the pace of Chinese manufacturing growth slowed in June. The FBM KLCI loss 19.01 points, week-on-week, to 1,307.44 compared with 1,326.45 the previous Friday. A total of 3.024 billion shares worth RM4.822 billion were traded last week, down from 3.596 billion shares valued at RM5.733 billion the week before.

On the weekly chart, the benchmark FBM KLCI formed a bearish black candlestick, which confirmed the reversal signal generated by the shooting-star candlestick formed the week before. Hence, the benchmark index may continue its downward move this week to test the psychological support at 1300. The immediate critical support level is at 1297, provided by the 30-week moving average (MA). If this support level is broken, then we may see the key index sliding lower towards the 1280 level, which is where the 200-day MA is now.

On the daily chart, a bearish Head-and-shoulder chart pattern is in the formation. Its neckline now lies at 1250 level. If the benchmark index could not hold well above the current level, then it might move lower to test the lower support levels at 1283 and 1264 provided by the 200-day and 240 day MA, and ultimately the neckline support at 1250. Technically, if the neckline is broken, the downside target for the Head-and-shoulder pattern is at 1140.

Weekly MACD continued to slide lower after turning up slightly the previous week, indicating the index is losing its longer term momentum. Daily MACD has just made a dead-cross over its signal line, confirming the short term bearish outlook of the key index. Weekly RSI(14) at 53.7 continued to move lower into the neutral zone, whereas daily RSI(14) at 47.7 has already move into the mildly bearish zone. Weekly Stochastic at 69 continued to move higher, whereas the short term daily Stochastic at 36.9 has moved lower, reflecting the current short term correction of the key index. Signals from the indicators, both short and long term, are pointing towards further downward correction of the FBM KLCI.

The short term trend of the FBM KLCI has turned southward, but the long term trend remained up. However, the long term moving averages are converging fast, indicating a loss in the long term upward momentum, which is a bad sign.

With no fresh market leads locally, and the continued concerns over the global economy's health which would continue to dampen investor sentiment, the benchmark FBM KLCI is likely to continue its consolidation mode with a downward bias, and will track the performance of the regional markets.

The Dow closed -46.05 points or -0.47% lower on last Friday at 9,686.48. This week, the FBM KLCI may trade within a range of 1260 to 1341, and for today it is likely to trade within a range of 1299 to 1313.

This week's expected range: 1260 – 1341
Today’s expected range: 1299 – 1313

Resistance: 1309, 1311, 1313
Support: 1299, 1303, 1305

FBM KLCI - bearish Harami

Stocks on Bursa Malaysia extended their losses yesterday, tracking the weak performances of regional markets as concerns over a slowing economy continued to weigh on investor sentiment. The FBM KLCI fell 5.26 points or 0.40% to 1,308.76 points after opening 1.05 points lower at 1,312.97 points. Losers outnumbered gainers by 413 to 206 while 238 counters were unchanged. Volume eased to 557 million shares valued at RM1.022 billion from Wednesday's 563 million shares worth RM987 million.

The FBM KLCI opened 1.05 points lower but move into the positive territory briefly before selling pressure sent it lower as the day progressed. It traded within the range of previous day’s candle and formed a bearish Harami candlestick, signifying uncertainty of the market at this level, hence, it might move lower.

The key index found its immediate support by the 100-day MA at 1306 when it rebounded off it twice over the last two days. The lower support zone at 1298 to 1306 has now become a critical support area for the key index, if this support zone is breached, then, the index might plunge towards the 1270 level.

MACD continued to slide lower indicating the pick up in downward momentum. RSI(14) at 48.5 has turned bearish. Stochastic at 50 continued to slide lower, indicating the down cycle is picking up steam. Signals from the indicators point towards possible more downside to come for the FBM KLCI.

Sentiment remained weak because of numerous uncertainties on Wall Street and even in China. In view of a lack of fresh leads, the FBM KLCI is expected to continue drifting lower. Overnight, the Dow closed -41.49 points or -0.42% lower at 9,732.53. Today the FBM KLCI is likely to trade within a range of 1295 to 1320.

This week's expected range: 1293 – 1352
Today’s expected range: 1295 – 1320

Resistance: 1311, 1315, 1320
Support: 1295, 1301, 1305

FBM KLCI - short term trend turned southward

Stocks on Bursa Malaysia ended lower yesterday tracking the lackluster performances of equity markets globally on concerns over the pace of the global economic recovery. The FBM KLCI ended the day 5.82 points lower at 1314.02 but off its earlier low of 1306 after opening 10.66 points lower at 1309.18. Losers led gainers by 343 to 267 while 259 counters were unchanged. Turnover was lower at 563 million shares worth RM987 million, down from Tuesday’s 741 million shares worth RM1.05 billion.

The FBM KLCI opened 10.66 points lower at 1314.02 taking cue from the 268 points fall on the Dow overnight. It hit the intra-day low of 1306 within five minutes after opening and rebounded from there to hit the intra-day high of 1316.36, and profit-taking activities trimmed intra-day gain which led the index to close off-high to form a white candlestick, which indicates buyers were stronger than the sellers due to bargain hunting activities. However, the key index has moved below the 1318 support level and is now in the support zone of 1300 to 1318 with a downward bias.

MACD continued to slide lower, indicating the gradual increased in downward momentum, and may continue to slide lower. RSI(14) at 51.7 continued to slide lower towards the neutral line at 50, indicating the loss of market strength. Stochastic at 65 also continued to slide lower, reflecting a continuation of the down cycle. Signals from the indicators are pointing towards more weakness to come for the benchmark FBM KLCI.

Immediate support for the FBM KLCI now lies at 1298 to 1308, while the overhead resistance is at 1318 to 1330. If the key index breaks below the psychological support at 1300, there might be more downside to come and will re-visit the 1280 level. Short term, the FBM KLCI has turned downtrend, while the longer term trend still remained up for the time being.

Overnight, the Dow closed -96.28 points or -0.98% lower at 9,774.02. Today the FBM KLCI is likely to trade within a range of 1298 to 1323.

This week's expected range: 1293 – 1352
Today’s expected range: 1298 – 1323

Resistance: 1317, 1320, 1323
Support: 1298, 1302, 1308