Stocks on Bursa Malaysia ended mixed in range-bound trading yesterday. Persistent buying interest in small-and medium-capitalized counters such as plantation, election-themed, oil and gas stocks helped sustained the local stock market. The benchmark FBM KLCI rose 0.79 point or 0.05% to 1510.58, after opening 0.98 point better at 1510.77. Market breadth was positive with gainers led losers by 390 to 347 while 309 counters were unchanged. Turnover rose marginally to 1.173 billion shares valued at RM1.677 billion from Monday’s 1.158 billion shares valued at RM1.662 billion.
The FBM KLCI opened 0.98 points higher at 1510.77 and surged to the intra-day high of 1512.87 within the first fifteen minutes, and thereafter, sink to the intra-day low of 1506.03 on profit-taking pressures. The key index rebounded off low on last minute buying of selected heavyweight to end marginally higher at 1510.58. Chart-wise, the FBM KLCI formed a Doji candlestick with long lower shadow, which indicates indecision of the market direction with buying support for index-linked counters at lower levels. The key index is likely to continue with its consolidation while waiting for stronger leads to push it higher.
MACD continued to move higher but at a slow pace, as shown by the shorter histograms, which indicates a lack of upward momentum. RSI (14) at 55.9 is almost flat, and continued to remain in the neutral zone. Stochastic at 71.9 has move below the 80 mark, indicating a continuation of the down cycle in market strength or consolidation. Readings from the indicators shows a lack of momentum in the FBM KLCI, and hence is likely to continue its consolidation.
The FBM KLCI is currently below the 5-day moving average (MA) which is at 1511.80, but is above all other moving averages which indicates short term sideways consolidation. The longer term uptrend remained intact. Immediate overhead resistance zone is at 1517 to 1523 while the downside support zone is at 1506 to 1500. With trading volume maintaining above 1 billion shares, the overall market is expected to remain active with rotational play on second and third liners in particular plantation stocks, oil and gas and election-themed counters.
Overnight, the Dow rose +47.98 points or +0.42% higher to close at 11,476.54. Today, the FBM KLCI is likely to trade within a range of 1500 to 1520.
This week's expected range: 1470 – 1548
Today’s expected range: 1500 – 1520
Resistance: 1514, 1517, 1520
Support: 1500, 1503, 1506
Stocks to watch: KNM, INCKEN, LANDMRK, TWSPLNT, TDM, HSPLANT
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