Stocks on Bursa Malaysia ended broadly lower yesterday as investors sold some of their holdings in selected heavyweights. External factors, including weaker performance on Wall Street and concerns over Greece debt crisis, had affected sentiment across the region. The FBM KLCI slipped 1.95 points or 0.13% to 1,554.24, dragged down by losses in Petronas Chemicals. Decliners led advancers by 558 to 210, while 289 counters closed unchanged. Total volume fell to 814.91 million shares valued at RM1.65 billion from Wednesday’s 888.69 million shares valued at RM1.6 billion.
Taking cue from the weak performance of Wall Street overnight, the FBM KLCI opened 3.08 points lower at 1,553.11 and slid to the intra-day low of 1,549.65. The key index then rebounded to hit the intra-day high of 1,554.24 was moving within these two extremes before last minute buying of selected blue-chips pushed the key index to close at the day’s high. Chart-wise, the FBM KLCI formed a white hammer candlestick in bullish Harami position which indicates sellers were dominant initially, but later buyers fought back to take control of the key index, and the FBM KLCI is likely to continue its upward momentum to move higher. However, immediate strong overhead resistance zone is at 1,556 to 1,560, as the key index is currently still stay within the downtrend channel.
MACD was marginally down and continued to stay below the signal line, indicating the FBM KLCI is still in consolidation mode. RSI (14) has hooked downward to 56.5, and is still in the mildly bullish zone. Stochastic is at 48.5 and has hooked upward slightly, but is still below the slow stochastic line, signaling a mild rebound. Readings from the indicators showed that the FBM KLCI is still in a consolidation mode, and this may be extended until clear sign of upward breakout is observed.
For the short term, the FBM KLCI is still trapped in the downtrend channel, and a close above 1,560 is required for the key index to breakout from this downtrend channel. However, the FBM KLCI is currently closing above all the short, medium and long term moving averages, and hence has an upward bias. The medium term trend remained sideways while the long term uptrend is still intact. Immediate overhead resistance is at 1,556 to 1,560, while the downside support zone is at 1,549 to 1,540.
Overnight, the Dow rose +64.25 points or +0.54% to close at 11,961.52. Today, the FBM KLCI is likely to trade within a range of 1,546 to 1,559
This week's expected range: 1539 – 1569
Today’s expected range: 1546 – 1559
Resistance: 1556, 1557, 1559
Support: 1546, 1548, 1551
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