Stocks on Bursa Malaysia moved sideways to close mixed on last Friday as most investors stayed on the sidelines on lack of fresh leads and many were absent during school holidays. Last-minute buying, particularly of plantation and finance counters, pushed the FBM KLCI to close firmer which ended the week 1.81 points or 0.12% higher at 1,559.85, and week-on-week, it gained 11.16 points from previous Friday’s close of 1,548.69. Gainers led losers by 376 to 335 while 326 counters were unchanged. Daily turnover dropped to 581.943 million shares valued at RM1.038 billion from Thursday’s 716.728 million shares worth RM1.483 billion, and weekly volume declined to 4.072 billion shares worth RM9.827 billion from 4.197 billion shares worth RM7.321 billion the previous week.
Bursa Malaysia was generally in cautious mood last week with sideways trading prevailing in the market. The benchmark FBM KLCI opened 1.38 points higher at 1,550.07 on last Monday, but heavy profit-taking activities pressed it to the intra-week low of 1,541.50 before rebounding strongly to touch the intra-week high of 1,566.29 on Tuesday. On Wednesday, the key index shed 1.87 points to 1,556.42, but rebounded 1.62 points to close at 1,558.04 on Thursday in quiet trading. The FBM KLCI continued to rise another 1.81 points to 1,559.85 on Friday in one of the lowest trading volume day for the year.
On the weekly chart, the FBM KLCI formed a white spinning-top like candlestick which indicates the bulls were gaining control for the week and pushed the index higher. It touched the immediate key resistance level of 1,566 but pulled back on profit-taking. For the coming week, if the key index can push through this resistance level convincingly with volume, it might then move higher to challenge the historical high level of 1,576.95. Otherwise, it is likely to stay range-bound in view of the extremely low volume registered last Friday.
On the daily chart, the FBM KLCI formed a Doji candlestick with a long lower shadow, indicates the key index was subjected to selling pressure but a last minute recovery helped to push the key index back to the positive territory. The formation of Doji candlestick near the key resistance area also indicates that the market was undecided of its direction, and this may forewarn of a possible reversal.
Weekly MACD continued to climb higher, indicating the weekly momentum is gradually picking up but has not turn fully bullish yet until its crosses above the signal line; Daily MACD continued to climb higher, indicating a continuation in the daily upward momentum. Weekly RSI (14) continued to climb higher to 60.3, and has just entered the bullish zone. Daily RSI (14) gained marginally to 63.8 and is higher into the bullish zone. Weekly Stochastic continued to climb higher to 82.9, and is into the short term overbought zone, indicating strong weekly market strength. Daily Stochastic, however, was marginally higher at 79.8, and has crossed above its slow stochastic line. Signals from the indicators showed that the FBM KLCI is currently short term bullish, and hence may continue its upward momentum to climb higher.
The short term trend of the FBM KLCI is currently up, while the medium term trend is still sideways, and the long term uptrend remained intact. Immediate overhead resistance zone is at 1,566 to 1,577, while the immediate downside support zone is at 1,550 to 1,541. In view of the very low trading volume, the market is likely to remain range-bound with an upward bias.
Last Friday, the Dow fell -97.29 points or -0.79% to close at 12,151.26. This week, the FBM KLCI is likely to trade within a range of 1,520 to 1,591, and for today it is likely to trade within a range of 1,548 to 1,569.
This week's expected range: 1520 – 1591
Today’s expected range: 1548 – 1569
Resistance: 1563, 1566, 1569
Support: 1548, 1551, 1555
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