Millionaire Trend Trader: FBM KLCI - rebounded to close higher

Wednesday, June 15, 2011

FBM KLCI - rebounded to close higher

Stocks on Bursa Malaysia closed slightly higher yesterday, supported by mild buying activities in selected blue-chips. The local bourse, in a range-bound trade since last week, saw the market barometer FBM KLCI closing 2.63 points higher at 1,548.51 after opening 0.17 point lower at 1,545.71. Gainers led losers by 388 to 331 while 329 counters closed unchanged. A total of 737.884 million shares worth RM1.209 billion changed hands compared to Monday's closing volume of 733.03 million shares valued at RM1.131 billion.

The FBM KLCI opened 0.17 point lower at 1,545.71 and fell to the intra-day low of 1,543.56 within the first thirty minutes. The key index then rebounded to touch the intra-day high of 1,551.83 before pulling back to close off high at 1,548.51 on profit-taking activity. Chart-wise, the FBM KLCI formed a piercing-line candlestick which is a bottom reversal candle pattern, and the key index is likely to continue its rebound today. The FBM KLCI is currently in short term downtrend, and it will have to close above the 1,558 level in order to reverse the current downtrend.

MACD continued to slide lower after crossing over its signal line, indicating a continuous loss in momentum. RSI (14) has hooked upward to 53.1, reflecting the rebound and the relative market strength of the key index is currently in the neutral zone. Stochastic continued to slide lower, indicating the short term down cycle is still in force and the weakening of the short term market strength. Readings from the indicators showed that the FBM KLCI is currently in a consolidation mode and may continue to remain so until a clear signal of bullish reversal is observed.

The short term trend of the FBM KLCI is currently down, while the medium term trend remained sideways, and the long term trend, however, is still up. Immediate overhead resistance zone is at 1,552 to 1,560, and the downside support zone is at 1,540 to 1,530. With the overall volume traded remained below 1 billion shares, the overall market is likely to remain sluggish.

Overnight, the Dow rose +123.14 points or +1.03% to close at 12,076.11. Today, the FBM KLCI is likely to trade within a range of 1,536 to 1,560.

This week's expected range: 1539 – 1569
Today’s expected range: 1535 – 1560

Resistance: 1552, 1556, 1560
Support: 1535, 1539, 1544

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Wednesday, June 15, 2011

FBM KLCI - rebounded to close higher

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