Stocks on Bursa Malaysia closed higher yesterday, lifted by gains in telecommunication counters and selective interest in blue chip stocks. Interest in telecommunication counters helped to keep the local market steady despite mild profit taking. The FBM KLCI increased 3.95 points or 0.26% to 1,539.55, after opening 6.74 points higher at 1,542.34. The overall market sentiment was positive with gainers thumping losers by 506 to 379 while 257 counters were unchanged. Total volume declined to 3.18 billion shares valued at RM2.74 billion from 3.24 billion shares worth RM2.62 billion on Monday.
The FBM KLCI opened with an up gap of 6.74 points and climb to the intra-day high of 1544.35 at late morning. Profit-taking activities which surfaced pressed the key index to the intra-day low of 1538.76 before rebounding to close off low at 1539.55. Chart-wise, the FBM KLCI formed a black spinning-top candlestick which indicates mild selling pressure and the bears were in action despite the key index closing higher. The key index continued to stay below the 20 and 30-day moving averages (MA) which continued to act as barriers to the key index’s up move. If the FBM KLCI is able to clear the resistance and close above 1550, then it would re-gain its bullishness.
MACD has curved upward, albeit still below the zero-line, and together with the shorter histograms indicate a mild pick up in the momentum. RSI (14) at 51.5 has crossed above the 50 mark, and is moving back to the mildly bullish zone. Stochastic is at 42.6, and is continuing the up cycle which indicates the key index is gradually gaining its upward strength. Readings from the indicators show that the correction phase of the FBM KLCI is gradually over, and the key index is gradually re-gaining its upward momentum.
The short term trend of the FBM KLCI is currently sideways with an upward bias, while the medium and long term uptrend remained intact. Immediate overhead resistance zone is at 1540 to 1550, while the downside support zone is at 1520 to 1505. The FBM KLCI may continue its up move slowly, while the second and third liners will remain active on rotational play judging from the high volume registered over the last two days.
Overnight, the Dow rose +71.52 points or +0.59% to close at 12,233.15. Today, the FBM KLCI is likely to trade within a range of 1531 to 1550.
This week's expected range: 1482 – 1567
Today’s expected range: 1531 – 1550
Resistance: 1543, 1547, 1550
Support: 1531, 1535, 1537
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