Stocks on Bursa Malaysia ended mixed yesterday with the benchmark FBM KLCI rebounded to close 1.75 points or 0.12% higher at 1501.56 after two consecutive days of heavy profit-taking last week. Losers led gainers by 442 to 330 while 288 counters were unchanged. Turnover dropped drastically to 1.086 billion shares worth RM1.256 billion from Friday’s 1.724 billion shares worth RM2.393 billion.
The FBM KLCI opened 0.2 of a point lower at 1499.61and slipped to the intra-day low of 1497.04 within the first half-an-hour; it then rebounded to the intra-day high of 1503.56 and traded sideways in a narrow range throughout the day. Chart-wise, the FBM KLCI formed a small white spinning-top candlestick, which indicates indecision of the market direction and consolidation. The key index is likely to consolidate around current level for a while before making its way back to re-visit the top.
MACD continued to slide lower, nonetheless, is still above the zero line, indicating the loss of upward momentum and the key index is going into a correction or consolidation mode. RSI (14) at 53.2 has hooked up slightly, reflecting the mild rebound, and the market strength is currently neutral. Stochastic at 37.9 continued to slide lower, indicates the continuation of the down cycle. Readings from the indicators indicates the FBM KLCI is likely to go into a consolidation mode.
The FBM KLCI is currently staying below its short term 5, 10 and 20-day moving averages (MA), but is above its 30-day MA, which indicates short term correction. However, the moving averages have not made any dead-cross yet, if the key index is able to close above 1512, it may resume its uptrend, and otherwise it may consolidate around current level. If the key index closes below the 30-day MA support at 1496, it may slide lower to re-test its immediate support at 1488.
The benchmark FBM KLCI is likely to continue with its consolidation, while the second and third liners are likely to remain active and in rotational play. Overnight, The Dow rose +9.39 points or +0.08% higher to close at 11,201.97. Today, the FBM KLCI is likely to trade within a range of 1491 to 1513.
This week's expected range: 1450 – 1528
Today’s expected range: 1491 – 1513
Resistance: 1504, 1507, 1513
Support: 1491, 1494, 1498
Stock to watch: SALCON
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