Millionaire Trend Trader: FBM KLCI - resumed its short term uptrend

Thursday, December 9, 2010

FBM KLCI - resumed its short term uptrend

Stocks on Bursa Malaysia ended higher yesterday with continued buying in CIMB and TENAGA lifting the market barometer despite a mixed regional market performance. The FBM KLCI gained 8.32 points to 1510.06, after opening 2.78 points higher at 1504.52. Gainers led losers by 458 to 310 while 277 counters were unchanged. Total volume rose to 1.084 billion shares, valued at RM2.176 billion, from Monday’s 846 million shares, valued at RM1.56 billion.

The FBM KLCI opened with an up gap of 2.78 points at 1504.52 and surged to the intra-day high of 1513.24 within the first thirty minutes, and profit-taking activities sent the key index lower for most part of the day, but a last minute buying of selected heavyweights helped lift the key index to close off low at 1510.06. Chart-wise, the FBM KLCI formed a bullish white candlestick which staged a breakout from its recent consolidation range. The key index managed to breakthrough the resistance at 1510 to reach 1513 and rest on it at close; it is likely that the key index will continue its up move today to re-test higher resistance levels.

MACD continued to move higher, and has just made a bullish golden-cross over its signal line, which is a strong buy signal, indicating the building up of bullish momentum. RSI (14) at 58.2 also moved higher into the mildly bullish zone. Stochastic at 81.4 indicates the market strength is turning strong for the short term. Readings from the indicators indicates that the FBM KLCI is moving out from its consolidation and is gaining strength to move higher.

Short term trend has again turned up as the 5-day moving average (MA) has firmly crossed above the 10-day MA, and the key index is also above all its MAs. The medium and long term uptrend remained intact. Immediate overhead resistance zone is at 1513 to 1532, while the downside support zone is at 1500 to 1474.
Overnight, the Dow gained +13.32 points or +0.12% higher to close at 11,372.48. Today the FBM KLCI is likely to trade within a range of 1496 to 1522.

This week's expected range: 1446 – 1532
Today’s expected range: 1496 – 1522

Resistance: 1514, 1518, 1522
Support: 1496, 1500, 1505

Stocks to watch: AIRASIA, KNM, TDM, OSK, KFIMA, UEMLAND

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Thursday, December 9, 2010

FBM KLCI - resumed its short term uptrend

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