Millionaire Trend Trader: FBM KLCI

Thursday, September 30, 2010

FBM KLCI - mild rebound

Stocks on Bursa Malaysia ended mixed yesterday with a mild rebound on the benchmark index, supported by buying on selected finance- and plantation-related stocks. Market sentiment was underpinned by the rally in the regional bourses. The FBM KLCI rose by 2.14 points or 0.15 per cent to end at 1461.78, after opening 4.68 points higher at 1464.32. Gainers outnumbered losers by 430 to 283 while 306 counters were unchanged. Volume fell to 905 million shares worth RM1.449 billion from 976 million shares worth RM1.351 billion on Tuesday.

The FBM KLCI opened 4.68 points higher at 1464.32 and surged to the intra-day high of 1466.29 in the first fifteen minutes before profit-taking activities sent it down to the intra-day low of 1459.12. The key index was in consolidation mode for most part of the day before last minute buying of selected heavyweights which lifted it off low to close 2.14 points higher at 1461.78. Chart-wise, the benchmark index formed a small body black candlestick which indicates low volatility and consolidation. The key index is currently supported below by the 5-day moving average (MA) at 1459 while it is bound on top by the 10-day MA at 1466. A breakout in either way will see the key index moving in that direction.

MACD continued to slide lower as shown by the increasing length of the histogram, indicating a continued loss in upward momentum and a correction mode of the key index. RSI (14) at 63.5 has hooked up slightly reflecting a sideways situation; it is however, still in the mildly bullish zone. Stochastic at 65.5 has turned upward and just crossed above its slow stochastic reflecting a technical rebound of the key index. Signals from the indicators are reflecting the consolidation mode of the FBM KLCI.

For the immediate near term, the FBM KLCI has fall into a sideways consolidation mode, nonetheless, the underlying medium to long term trend still remained up. Immediate support zone for the key index lies at 1440 to 1450 while the overhead resistance zone remained at 1470 to 1480.

Overnight, the Dow fell -22.86 points or -0.21% lower to close at 10,835.28. Today, the FBM KLCI is likely to trade within a range of 1451 to 1473.

This week's expected range: 1403 – 1514
Today’s expected range: 1451 – 1473

Resistance: 1466, 1469, 1473
Support: 1451, 1455, 1458

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Thursday, September 30, 2010

FBM KLCI - mild rebound

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