Stocks on Bursa Malaysia closed on a mixed note yesterday as gains in selected blue-chips and heavyweights helped cushion the fall. Investors adopted a wait-and-see attitude as they were worried about the Euro-zone problems, as Europe was expected to see a banking crisis soon. The FBM KLCI rose 1.74 points or 0.12% to 1,448.00 after opening 3.23 points better at 1,450.09. Losers beat gainers by 359 to 278 with 296 counters unchanged. Turnover increased to 727.19 million shares worth RM876.45 million from 659.784 million shares worth RM1.17 billion on Monday.
The FBM KLCI opened 3.23 points higher at 1,450.09 and surged to the intra-day high of 1,452.15 within the first five minutes, and profit-taking pressed the key index to the morning session low of 1,446.38. The key index rebounded and moved in a tight range around 1,450 before late afternoon sell down which pushed it to the intra-day low of 1,445.97, and some buying in blue-chips lifted it to close off low. Chart-wise, the FBM KLCI formed a bearish small black spinning-top candlestick in Harami position which indicates indecision and consolidation. As the candle formed was black, it showed that the sellers were in control preventing the key index from moving higher. Nonetheless, as there was no new low compared with the low on Monday, the FBM KLCI is trying to settle down and the selling pressure is weakening, and a rebound is expected.
MACD was marginally lower, and is still above the signal line, indicating correction to the rebound, and the momentum is weakening. RSI (14) hooked up marginally to 36.1, reflecting the weak gain on the key index, and the index is still in the bearish zone. Stochastic slid lower to 23.2, indicating the continuation of the down cycle and very weak market strength. Readings from the indicators showed that the FBM KLCI is still weak and bearish, and is likely to continue to stay range-bound with a downward bias.
The trend of the FBM KLCI remained down. In order to reverse the current downtrend, the key index will have to break above the upper resistance line of the downtrend channel which is currently at 1,470. However, it looks tough at the moment. A downside break of the support at 1,442 will see the FBM KLCI sliding toward the critical support level of 1,423. Overnight, the Dow rose +44.73 points or +0.40% to close at 11,105.85. Today, the FBM KLCI is likely to trade within a range of 1,439 to 1,459.
This week's expected range: 1427 – 1508
Today’s expected range: 1439 – 1459
Resistance: 1452, 1455, 1459
Support: 1439, 1442, 1445
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