Stocks on Bursa Malaysia ended the Year of the Tiger on a positive note last Wednesday, 2nd Feb 2011, before the arrival of the Year of the Rabbit. The benchmark FBM KLCI ended the holiday-shortened week to close 11.88 points higher at 1,531.82 from Monday’s close of 1519.94, after the half-day trading on the eve of Lunar New Year. Week-on-week, it gained 9.93 points from the previous Friday’s close of 1,521.89. Gainers led losers by 674 to 138 while 172 counters were unchanged. Turnover increased to 1.532 billion shares worth RM1.702 billion, despite half a day trading, from 1.415 billion shares worth RM2.08 billion on Monday.
Taking cue from the bearish performance of Wall Street the previous Friday, the FBM KLCI opened with down gap of 14.22 points at 1507.67 on last Monday and plunged to the intra-day low of 1505.85 before rebounding strongly to close at 1,519.94, losing only 1.95 points. Bursa Malaysia was closed for Federal Territory Holiday on Tuesday. The benchmark index continue to move higher Wednesday on investors’ optimism that the market may rally after the long Chinese New Year holiday break, following better-than-expected manufacturing data from the US and China.
On the weekly chart, the FBM KLCI formed a bullish piercing-line candlestick which indicates counter-attack by the bulls after three consecutive weeks of profit-taking correction, and the key index may continue to move higher. The key index had bounced off the 20-week moving average (MA), but is below the 5-week MA which is currently at 1548.65, and this may act as a barrier to the key index’s up move.
On the daily chart, The FBM KLCI formed a bullish white candlestick with an up gap, which indicates a bullish rebound. It hit the intra-day high of 1536.26 but pulled back on mild profit-taking. The key index is currently closing above the 5 and 60-day MAs but is still below the 10 and 30-day MAs at 1538, and the 20-day MA at 1552 may together act as strong resistances to the up move of the FBM KLCI.
Weekly MACD continued to slide lower, indicating a continued loss of weekly momentum. Nevertheless, it is still in the positive zone, and hence, the current weakness may just be a short term correction from the weekly perspective. Daily MACD has, however, crossed below the zero line, indicating the key index has turned bearish for the short term from the daily perspective. Weekly RSI (14) has hooked up, and its reading of 63.6 indicates the key index is still bullish on the weekly chart. However, daily RSI (14) at 47.1 is still bearish. Weekly Stochastic continued to slide lower to 57.9, while daily stochastic has continued to climb higher, albeit in a slow pace. Readings from the indicators gave a mixed picture of the FBM KLCI, which indicates the key index is likely to continue its sideways consolidation.
The short term trend of the FBM KLCI remained down as the key index is still closing below the 10, 20 and 30-day MAs. The medium term uptrend is at test now as the index continues to hover around the 60-day MA. The long term uptrend however, is still intact. Immediate overhead resistance zone is at 1539 to 1552, while the immediate downside support zone is at 1520 to 1505.
With the long Chinese New Year holiday break officially over today plus the positive close of the Dow last week, the FBM KLCI is expected to pick up its momentum again. Last Friday, the Dow rose +29.89 points or +0.25% to close at 12,092.15. This week, the FBM KLCI may trade within a range of 1482 to 1567, and for today it is likely to trade within a range of 1514 to 1548.
This week's expected range: 1482 – 1567
Today’s expected range: 1514 – 1548
Resistance: 1538, 1543, 1548
Support: 1514, 1519, 1525
Stocks to watch: MAHSING, EKOVEST, HEXAGON, OLYMPLIA, MPHB
No comments:
Post a Comment