Stocks on Bursa Malaysia finished yesterday in the red due to selling pressure and lack of investor risk appetite. Asian markets, including the local bourse, continued their downtrend for the second consecutive day amid fresh concern over the Euro zone debt crisis. Some bargain hunting was noted yesterday, especially for Axiata, Eastern & Oriental and Genting. The benchmark FBM KLCI closed 8.75 points or 0.60% lower at 1,454.37 after opening 2.86 points easier at 1,460.26. Losers thumped gainers by 423 to 253 while 279 counters were unchanged. A total of 706.7 million shares worth RM1.517 billion changed hands compared with 640.321 million shares worth RM1.37 billion transacted on Monday.
The FBM KLCI opened with a down gap of 2.86 points at 1,460.26 and slid lower to touch the intra-day low of 1,453.26. The key index rebounded and gradually recovered lost ground and climb higher to hit the intra-day high of 1,462.32 before profit-taking activity which appeared in the last hour sent the index to close near the day’s low. Chart-wise, the FBM KLCI formed a bearish black candlestick which filled the upside gap that formed on September 2nd, and it is likely that the key index will continue its slide to move lower to test the immediate support levels at 1,450, 1,446 and 1,442. A breach of the 1,442-point support level will likely see the FBM KLCI move lower to the 1,436-point support level provided by the 420-day moving average (MA), which has recently given the key index a strong support at the 1,423-point level.
MACD has again turned downward, signifying the end of the rebound, and hence is likely to continue with its bearish downward momentum. RSI (14) continued to slide lower to 35.3 from 37.6, indicating an increased in the bearishness. Stochastic is higher at 31.8, and has however bucked the trend to cross above the slow stochastic line. Readings from the indicators showed that the FBM KLCI is still in a weak and bearish state, and hence is likely to continue with its consolidation.
The trend of the FBM KLCI remained down and bearish. With the downward move yesterday which broke the 360-day MA support level at 1,460, the key index has resumed its downtrend, and is likely to re-visit the critical support level at 1,423. Overnight, the Dow fell -100.96 points or -0.90% to close at 11,139.30. Today, the FBM KLCI is likely to trade within a range of 1,441 to 1,471.
This week's expected range: 1414 – 1521
Today’s expected range: 1441 – 1471
Resistance: 1460, 1466, 1471
Support: 1441, 1447, 1450
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