Stocks on Bursa Malaysia ended mixed last Friday with foreign investors nibbling on blue-chips, amid lack of interest for second and third liners. Buying interest continued to centre on finance, plantation and power-related stock amid positive earnings headlines and overnight Wall Street performance. The FBM KLCI closed 7.75 points or 0.5% steadier at 1,548.69, and on a weekly basis, it gained 7.56 points from previous Friday’s close of 1,541.03. Losers outpaced gainers by 464 to 314 while 300 counters were unchanged. Turnover increasing to 947.812 million shares, valued at RM1.689 billion, from Thursday's 799.622 million shares valued at RM1.42 billion. Weekly volume increased to 4.197 billion shares, valued at RM7.321 billion, from previous week’s 3.56 billion shares valued at RM6 billion.
On the weekly chart, the FBM KLCI formed a white hangman candlestick which indicates the bears were initially strong in pushing the key index to the intra-week low of 1,525.71, but the bulls later fought back and lift the key index to the positive territory to hit the intra-week high of 1,549.96 before pulling back to close at 1,548.69. The price action of the FBM KLCI indicates that the bulls have overcome selling pressure by the bears, and may continue its upward momentum to move higher this week. The FBM KLCI is currently closing above its 5 and 10-week moving averages (MA), which indicates the short term trend is up.
On the daily chart, the FBM KLCI opened last Friday with an up gap of 4.15 points at 1,545.09 and traded higher to touch the intra-day high of 1,549.96 before pulling back to close at 1,548.69. The key index formed a bullish white candlestick with a continuation gap which indicates buyers were strong and in control for the day, and hence the key index may continue with its momentum to move higher. Immediate resistance is at the psychological level of 1,550, follow by the downtrend line resistance at 1,555, and the recent high of 1,565.
Weekly MACD has curved up slightly while its histogram has continued to turn shorter upward, indicating the weekly momentum has started to show sign of turning upward. Daily MACD has continued to move higher, indicating a continuation in the daily upward momentum.
Weekly RSI (14) is higher at 58.2 which indicate the weekly relative strength of the FBM KLCI is turning mildly bullish, while daily RSI (14) has turned bullish as the reading is now at 60.4.
Weekly Stochastic has continued to rise further to 76.2 and daily Stochastic is also higher at 76.4. Both weekly and daily stochastic readings indicate a continuation in the up cycle and market strength. Readings of the indicators showed that the FBM KLCI is gradually gaining its upward momentum and is turning bullish for the short term, and the key index may continue with its current upward momentum to move higher.
The short term trend of the FBM KLCI has turned upward. However, it is currently still bound within the consolidation triangle with immediate resistance level at 1,555 posted by the downtrend line. If the FBM KLCI is able to break above 1,555 and the recent pivot high at 1,565, then it may move higher to re-test its historical high of 1,576.95, beyond this will be uncharted territory. The medium term trend is still sideways while the long term uptrend remained intact. With volume picking up again on last Friday, albeit still below the 1 billion mark, the FBM KLCI may continued its upward move to test higher resistance level.
Last Friday, the Dow rose +38.82 points or +0.31% to close at 12,441.58. This week, the FBM KLCI is likely to trade within a range of 1,508 to 1,576, and for today it is likely to trade within a range of 1,537 to 1,557.
This week's expected range: 1508 – 1576
Today’s expected range: 1537 – 1557
Resistance: 1552, 1555, 1557
Support: 1537, 1540, 1544
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