FBM KLCI - higher on technical rebound

Stocks on Bursa Malaysia closed lower yesterday, in tandem with losses on global markets due to concerns over the prospects of economic slowdown in US and China. Gains in selected blue-chips, however, helped the benchmark FBM KLCI to gain 1.69 points or 0.11% to close at 1,585.44. Decliners beat advancers by 462 to 260 while 353 counters were unchanged. Turnover fell to 1.496 billion shares worth RM1.398 billion from 1.562 billion shares worth RM1.305 billion on Wednesday.

The FBM KLCI opened 0.42 point higher at 1,584.17 but slipped to the intra-day low of 1,581.79 within the first twenty minutes of trading. The key index rebounded to climb higher gradually to close near the intra-day high level. Chart-wise, the FBM KLCI formed a small white hammer-like candlestick, a bottom reversal candlestick pattern, which indicates the bears were initially dominant but later the bulls fight back to push the key index higher. As the candlestick also formed a piercing-line candle pattern, the FBM KLCI is likely to stage a follow through rebound today. Immediate overhead resistance is envisaged at 1,589 and 1,591.

MACD was marginally lower and so is the histogram, indicating a continued loss in the key index’s momentum. Nevertheless, as the MACD is still above the zero-line, current weakness may well be just part of a consolidation process in an uptrend. RSI (14) hooked up slightly to 60 from 58.9 previously, reflecting the mild rebound and a return of the short term relative strength to the bullish zone. Stochastic was flat at 81.2, and is still above the slow stochastic line, indicating a pause in the downward momentum. Readings from the indicators showed that the FBM KLCI is currently in a consolidation mode.

The overall uptrend of the FBM KLCI remained intact, and the key index has also closed above the short term 5-day SMA. Immediate overhead resistance zone is at 1,589 to 1,594 while the downside support zone is at 1,581 to 1,570, with 1,573 being a critical support provided by the 30-day SMA. With the total volume continue to shrink, the consolidation process is likely to extend. Overnight, the Dow gained +19.61 points or +0.15% to close at 13,145.82. Today, the FBM KLCI is likely to trade within a range of 1,579 to 1,590.

This week's expected range: 1559 – 1604
Today’s expected range: 1579 – 1590

Resistance: 1587, 1588, 1590
Support: 1579, 1580, 1583

FBM KLCI - lower on pullback correction

Stocks on Bursa Malaysia closed lower yesterday in tandem with losses in global markets. The benchmark FBM KLCI declined 4.35 points or 0.27% to 1,583.75. Decliners beat advancers by 491 to 244 while 350 counters were unchanged. Turnover was lower at 1.562 billion shares worth RM1.305 billion from 1.944 billion shares worth RM1.663 billion on Tuesday.

The FBM KLCI opened 0.06 of a point higher at 1,588.16 and traded to the intra-day high of 1,589.50 in early morning trade. Selling pressure on profit-taking activity pressed the key index to the intra-day low of 1,582.80 before rebounding slightly to close off low. Chart-wise, the FBM KLCI formed a bearish black candlestick which indicates the bears were in control and a pullback correction, and the key index is likely to continue falling further. The FBM KLCI has closed below the 5-day SMA yesterday, and it is likely to slide lower to the next lower support level at 1,580 provided by the 10 and 20-day SMAs, and a break below the 1,580-point level is likely to see the key index falling lower towards the 30-day SMA support at 1,572.

MACD has curved downward, and the histogram also turned longer downward, indicating an increase in the bearish momentum. RSI (14) hooked downward to 58.9, reflecting the pullback correction and the short term relative strength has turned weaker to mildly bullish from bullish previously. Stochastic hooked downward to 81.2 from 84.9 previously, reflecting the pullback and indicating a possible end of the short term up cycle. Readings from the indicators showed that weakness is again surfacing and the FBM KLCI might go into a consolidation mode.

The overall uptrend of the FBM KLCI remained intact. Nevertheless, the key index has closed below the 5-day SMA yesterday, indicating the beginning of a possible short term correction. An important support level to watch is the 1,572-point level provided by the 30-day SMA, a close below this level is likely to see the FBM KLCI turning bearish for the short term. Overnight, the Dow fell -71.52 points or -0.54% to close at 13,126.21. Today, the FBM KLCI is likely to trade within a range of 1,574 to 1,597.

This week's expected range: 1559 – 1604
Today’s expected range: 1574 – 1597

Resistance: 1588, 1592, 1597
Support: 1574, 1578, 1581

FBM KLCI - higher in line with regional market

Stocks on Bursa Malaysia closed higher yesterday, buoyed by the rally in regional markets sparked by comments from US Federal Reserve chairman Ben Bernanke that easy monetary policy would remain to reduce unemployment. The benchmark FBM KLCI rose 5.12 points or 0.32% to 1,588.10 after opening 2.82 points higher at 1,585.80. Advancers beat decliners by 389 to 381 while 337 counters were unchanged. Turnover was higher at 1.944 billion shares worth RM1.663 billion from 1.497 billion shares worth RM1.334 billion on Monday.

Taking cue from the strong performance on Wall Street overnight, the FBM KLCI opened with an up gap of 2.82 points at 1,585.80 and surged to the intra-day high of 1,591.03 within the first ten minutes of trading. The key index got congested and slid lower from the high for the rest of the day, and nonetheless, it was staying in the positive territory throughout the day. Chart-wise, the FBM KLCI formed a white inverted hammer-like candlestick which indicates the bulls were initially dominant but the bears managed to cap the gain. The rebound yesterday has reversed the effect of the black inverted hammer candlestick formed a day ago, but as the candlestick currently formed is also an inverted hammer, it showed strong resistance at this level and the key index might make a pause today. Nevertheless, the key index is continuing its uptrend with an immediate resistance zone at 1,591 to 1,594.

MACD again turned upward after hooking downward a day ago, and the histogram also turned shorter upward indicating a gain in the upward momentum. Nevertheless, MACD is still below the signal-line. RSI (14) has hooked upward to 62.9, indicating the short term relative strength is still in the bullish state. Stochastic was higher at 84.9, indicating a continued improvement in the market strength and a continuation of the short term up cycle. Readings from the indicators showed that the FBM KLCI is still in a short term bullish state with a moderate upward momentum.

The uptrend of the FBM KLCI remained intact as the key index is currently above all the short, medium and long term moving averages. Trading pattern over the last few sessions showed that the market was trading cautiously at the current level, and the bears were actively taking profits whenever the bulls push the key index higher, hence, index-link counters are likely to continue their current cautious trading patterns and the penny stocks are likely to continue their dominance in the active scene.

Overnight, the Dow fell -43.90 points or -0.33% to close at 13,197.73. Today, the FBM KLCI is likely to trade within a range of 1,580 to 1,597.

This week's expected range: 1559 – 1604
Today’s expected range: 1580 – 1597

Resistance: 1591, 1594, 1597
Support: 1580, 1583, 1585

Stocks to watch: MPI, MTRONIC

FBM KLCI - lower on mild profit-taking activity

Stocks on Bursa Malaysia closed lower yesterday as sentiment turned softer in line with the weaker Asian markets weighed by disappointing economic data from US and China. The benchmark FBM KLCI closed 2.85 points or 0.18% lower at 1,582.98. Decliners beat advancers by 519 to 260 while 307 counters were unchanged. Turnover was lower at 1.497 billion shares worth RM1.334 billion from 1.997 billion shares worth RM1.41 billion on last Friday.

The FBM KLCI opened 0.11 of a point lower at 1,585.72 and traded is a narrow sideways range in the positive territory. The key index managed to touch the intra-day high of 1,588.06 before succumbing to selling pressure that appeared in the afternoon session which pushed it to close at the day’s low of 1,582.98. Chart-wise, the FBM KLCI formed a small black inverted hammer candlestick which indicates buying was initially dominant but later selling pressure pressed the key index to close lower. The appearance of a black inverted hammer after an uptrend indicates weakness is surfacing and a reversal is in sight, and the FBM KLCI may trade lower today.

MACD has curved downward slightly and the histogram also turned slightly longer downward, indicating an initial change in the momentum’s direction from up to down. RSI (14) has hooked downward to 60 from 62.6 previously, indicating a loss in the short term relative strength which put the key index at the borderline of the bullish zone. Stochastic, however, was higher at 75.3, indicating the short term up cycle was still intact. Readings from the indicators showed that the FBM KLCI is experiencing a mild pullback correction, and nevertheless, the short term cycle is still up.

The overall trend of the FBM KLCI remained up, and the weakness that surfaced yesterday did not change the broad picture as the key index is still staying above all the short, medium and long term moving averages. A short downtrend for the FBM KLCI is only confirmed if the key index closed below the 30-day SMA at 1,571 and follow by the pivot low of 1,562. Immediate overhead resistance zone is at 1,588 to 1,594 while the downside support zone is at 1,580 to 1,570.

Overnight, the Dow rose +160.90 points or +1.23% to close at 13,241.63. Today, the FBM KLCI is likely to trade within a range of 1,576 to 1,594.

This week's expected range: 1559 – 1604
Today’s expected range: 1576 – 1594

Resistance: 1587, 1590, 1594
Support: 1576, 1579, 1581

Stocks to watch : UNISEM, KEYWEST

FBM KLCI - uptrend likely to continue

Stocks on Bursa Malaysia closed last Friday on a softer note, dampened by news of a possible slowdown in China's growth and the economic unease in Europe. The market was jolted by an index released on Thursday that showed a renewed weakness in China's manufacturing. The benchmark FBM KLCI, however, closed 2.59 points or 0.16% better at 1,585.83, and on a Friday-to-Friday basis, the benchmark index advanced 14.78 points from 1,571.40 previously. Losers outnumbered gainers by 520 to 282 while 317 counters were unchanged. Total market volume dwindled to 1.997 billion shares worth RM1.41 billion from 2.86 billion shares worth RM1.57 billion on Thursday, while total weekly volume increased to 12.395 billion units worth RM8.044 billion, from 7.479 billion units worth RM8.609 billion the previous week.

The benchmark FBM KLCI opened last Monday 2.9 points higher at 1,574.30 and moved in a range-bound manner, it hit the intra-week low of 1,570.88 before rebounding to close 2.2 points at 1,573.6. Stocks on Bursa Malaysia traded mixed on Tuesday amidst cautious trading on Asian markets, and the FBM KLCI rose 4.02 points to close at 1,577.62. On Wednesday, the FBM KLCI rose 4.91 points to close at 1,582.53 amidst a mixed market but late buying interest in information technology-related counters helped give the local bourse a lift to close higher. The benchmark index rose by a marginal 0.71 point to 1,583.24 on Thursday helped by an ease in worries about China’s economic outlook as the latest data on China’s industrial activities were not as bad as expected, and on Friday, the FBM KLCI gained another 2.59 points to end the week at 1,585.83.

On the weekly chart, the FBM KLCI formed a bullish white candlestick which indicates the bulls were in control and made a reversal after two weeks of pullback correction, and the key index is likely to continue moving higher this week. Immediate overhead resistance zone is at 1,594 to 1,597. If the key index is able to breakthrough the all time high level of 1,597.08 successfully, it will try to challenge the psychological resistance level of 1,600. On the daily chart, the FBM KLCI formed a small white candlestick which continued the uptrend, and the small size of the candlestick indicated low volatility and trading in a narrow range. The key index is likely to move higher today continuing its uptrend, and the immediate overhead resistance zone is at 1,587 to 1,594, and the immediate downside support zone is at 1,582 to 1,570.

Weekly MACD continued to climb higher but is tapering off, while the histogram has turned shorter, indicating a slow down in the weekly upward momentum. Daily MACD continued to climb higher and so is the daily histogram, indicating a continued picking up in the daily upward momentum. Nevertheless, as the MACD is still below the signal-line, the current short term uptrend may turn out to be a technical rebound. Weekly RSI (14) has hooked upward to 64.5 from 62.1 previously, indicating the weekly relative strength continued to remain bullish. Daily RSI (14) climbed higher to 62.6, indicating the daily short term relative strength is in a bullish state. Weekly Stochastic, however, continued to slide lower to 88.7 from 90.4 previously, indicating a consolidation mode on the weekly chart. On the contrary, the daily stochastic has climbed higher to 69.3, indicating an improvement of the market strength and continuation of the short term up cycle. Readings from the indicators showed that the FBM KLCI’s weekly upward momentum is slowing down and is in a consolidation mode, whereas the daily is showing signs of bullishness and the momentum is also picking up.

The overall trend of the FBM KLCI remained up as the key index is currently staying above all the short, medium and long term moving averages. The uptrend is likely to continue with an immediate target of 1,600-point, if the FBM KLCI is able to breakthrough the 1,600-point level successfully, it will move into an uncharted territory with a possible target of 1,670.

Last Friday, the Dow gained +34.59 points or +0.27% to close at 13,080.73. This week, the FBM KLCI is likely to trade within a range of 1,559 to 1,604, and for today, it is likely to trade within a range of 1,579 to 1,592.

This week's expected range: 1559 – 1604
Today’s expected range: 1579 – 1592

Resistance: 1588, 1590, 1592
Support: 1579, 1581, 1583

FBM KLCI - sign of a potential reversal

Stocks on Bursa Malaysia closed mixed yesterday, helped by information technology-related counters and the ease in worries about China’s economic outlook as the latest data on China’s industrial activities were not as bad as expected. The benchmark FBM KLCI rose 0.71 point or 0.04% to close at 1,583.24. Losers led advancers by 397 to 363 while 360 counters were unchanged. Turnover decreased to 2.86 billion shares worth RM1.57 billion from 3.59 billion shares worth RM1.79 billion on Wednesday.

The FBM KLCI opened 1.59 points lower at 1,580.94 and slid to the intra-day low of 1,580.07 within the first five minutes of trading. The key index then rebounded and surged to the intra-day high of 1,586.65. It retreated on profit-taking and moved in a tight range for the rest of the day before a last minute selling pushed it to close just marginally higher. Chart-wise, the FBM KLCI formed a white inverted hammer candlestick which indicates the bulls were initially dominant but was later beaten by the bears. An inverted hammer candlestick appearing after a few days of up move normally signal a potential reversal and the key index might take a pause or reverse.

MACD inched up marginally and so is the histogram, indicating a gradual picking up in the momentum. Nevertheless, as the MACD is still below the signal-line, this may well be just a technical rebound. RSI (14) was marginally higher at 61.2, indicating a small improvement in the short term relative strength. Stochastic was higher at 57.2, indicating a continuation in the short term up cycle and improvement of the market strength. Readings from the indicators showed that the FBM KLCI is gradually gaining strength and momentum although marginal.

The overall trend of the FBM KLCI remained up. However, for the short term, the key index is still sideways range-bound but with an upward bias. Immediate overhead resistance zone is at 1,586 to 1,594 while the immediate downside support zone is at 1,580 to 1,573. With volume staying above the 2 billion shares mark, the broad market is likely to continue being dominated by active trading in the penny stocks while the index-link counters are likely to remain in consolidation mode.

Overnight, the Dow fell -78.48 points or -0.60% to close at 13,046.14. Today, the FBM KLCI is likely to trade within a range of 1,573 to 1,594.

This week's expected range: 1541 – 1605
Today’s expected range: 1573 – 1594

Resistance: 1587, 1590, 1594
Support: 1573, 1576, 1580

FBM KLCI - signs of turning bullish

Stocks on Bursa Malaysia ended on a mixed note yesterday but late buying interest in information technology-related counters helped give the local bourse a lift to close higher. Profit-taking was seen earlier, dampened by worries over the deeper-than-expected slowdown in China’s economic growth. The benchmark FBM KLCI rose 4.91 points or 0.31% to close at 1,582.53. Advancers led losers by 384 to 338 while 371 counters were unchanged. Turnover rose to 3.59 billion shares worth RM1.79 billion from 2.14 billion shares worth RM1.76 billion on Tuesday.

The FBM KLCI opened 2.24 points lower at 1,575.38 and slid to the intra-day low of 1,573.17 within the first fifteen minutes of trading. The benchmark index then rebounded and moved higher gradually for the rest of the day to close near the highest point of the day. Chart-wise, the FBM KLCI formed a bullish white candlestick which indicates the bulls were in control, and the key index is likely to move higher today. Immediate overhead resistance is at 1,583.55, and a break above this level is likely to see the FBM KLCI moving higher to re-test the gap at 1,585 to 1,589.

MACD hooked upward and its histogram also turned shorter upward, indicating a reduction in the downward momentum and appearance of the first sign of a possible bullish upswing. RSI (14) was higher at 60.8, indicating the return of the short term relative strength to the bullish zone. Stochastic hooked upward to 49.95 and has crossed above the slow stochastic line, indicating a reversal of the short term down cycle. Readings from the indicators showed that the FBM KLCI is showing signs of turning bullish again and more data is required to confirm it.

The short term trend of the FBM KLCI is still sideways range-bound; however, there are signs of bullishness appearing from the candlestick and indicators. Nevertheless, the medium and longer term uptrend still remained intact. Immediate overhead resistance zone is at 1,583 to 1,594 while the downside support zone is at 1,573 to 1,562. With volume surging above the two billion shares level which was contributed much from active trading in the penny stocks, the broad market is likely to see more rotational play on the lower liners.

Overnight, the Dow fell -45.57 points or -0.35% to close at 13,124.62. Today, the FBM KLCI is likely to trade within a range of 1,566 to 1,593.

This week's expected range: 1541 – 1605
Today’s expected range: 1566 – 1593

Resistance: 1586, 1590, 1593
Support: 1566, 1569, 1576

Stocks to watch: GTRONIC, NOTION

FBM KLCI - in consolidation mode

Stocks on Bursa Malaysia closed mixed yesterday amidst cautious trading on Asian markets. The benchmark FBM KLCI rose 4.02 points or 0.26% to close at 1,577.62, after opening 1.62 points higher at 1,575.22. Losers led gainers by 431 to 314 while 376 counters were unchanged. Turnover increased to 2.14 billion shares worth RM1.76 billion from the 1.8 billion shares worth RM1.51 billion on Monday.

The FBM KLCI opened 1.62 points higher at 1,575.22 and surged to the intra-day high of 1,579.88 within the first fifteen minutes of trading. Profit-taking activity then surfaced and pressed the benchmark index lower to hit the intra-day low of 1,573.81 before a last minute buying of selected blue-chips lifted it to close in the positive territory. Chart-wise, the FBM KLCI formed a white spinning-top candlestick which indicates consolidation and indecision of market direction. With the formation of this candle pattern, the FBM KLCI is likely to continue its current sideways range-bound trend with immediate overhead resistance at 1,584 and a downside support level at 1,570.

MACD continued to slide lower and is tapering off while its histogram has turned slightly shorter upward, indicating consolidation but the downward momentum has slow down. RSI (14) continued to improve to 58.2 and indicating the short term relative strength is still in the mildly bullish state. Stochastic, however, slid lower and has crossed below the slow stochastic line, indicating a continuation of the short term down cycle and consolidation. Readings from the indicators showed that the FBM KLCI is still in a consolidation mode and this may prolong until a clear breakout sign is observed.

The short term trend of the FBM KLCI is currently sideways range-bound. Nevertheless, the medium and longer term uptrend is still intact. An important support level to watch is the 1,567-point level provided the 30-day SMA. A break below this level will likely see the FBM KLCI turning bearish for the short term. The broad market is likely to remain in cautious trading today with penny stocks dominating the active scene.

Overnight, the Dow fell -68.94 points or -0.52% to close at 13,170.19. Today, the FBM KLCI is likely to trade within a range of 1,568 to 1,586.

This week's expected range: 1541 – 1605
Today’s expected range: 1568 – 1586

Resistance: 1581, 1584, 1586
Support: 1568, 1571, 1574

FBM KLCI - higher in directionless trading

Stocks on Bursa Malaysia closed on a mixed note yesterday amidst cautious trading in a directionless range-bound pattern. The benchmark FBM KLCI rose by 2.2 points or 0.14% to close at 1,573.6, after opening 2.9 points higher at 1,574.3. Losers led gainers by 434 to 319 while 329 counters were unchanged. Turnover fell to 1.8 billion shares worth RM1.51 billion from 2.414 billion shares worth RM1.926 billion on last Friday.

The FBM KLCI opened 2.9 points higher at 1,574.30 and moved to the intra-day high of 1,578.51 within the first twenty minutes of trade, and profit-taking activity which surfaced sent the benchmark index to the intra-day low of 1,570.88. It then rebounded and moved in a sideways range-bound mode till closing. Chart-wise, the FBM KLCI formed a small black spinning-top in Harami position, which indicates indecision of the market direction with a downward bias, as a black spinning-top candlestick indicated that the sellers were slightly dominant. Hence, the FBM KLCI is likely to continue its consolidation process today.

MACD continued to slide lower, indicating a continued loss in the momentum. RSI (14) hooked up slightly to 56, reflecting a weak rebound, and the short term relative strength was back to the mildly bullish zone. Stochastic has hooked down to 50.8, indicating a loss in the rebound strength and the short term market cycle may continue its downward trend. Readings from the indicators showed that the FBM KLCI is still in a consolidation process and may prolong as the market momentum continues to stay weak.

The short term trend of the FBM KLCI is currently sideways range-bound, while the medium and longer term trend is still up. Immediate overhead resistance zone is at 1,578 to 1,583 while the immediate downside support zone is at 1,570 to 1,562 with 1,567 being a critical support provided by the 30-day SMA. With volume again back to the 1.8 billion shares level, some rotational play on the penny stocks is likely to be seen while the index-link counters may continue to consolidate.

Overnight, the Dow rose +6.51 points or +0.05% to close at 13,239.13. Today, the FBM KLCI is likely to trade within a range of 1,562 to 1,587.

This week's expected range: 1541 – 1605
Today’s expected range: 1562 – 1587

Resistance: 1578, 1582, 1587
Support: 1562, 1566, 1570

FBM KLCI - likely to be sideways range-bound

Stocks on Bursa Malaysia closed mixed last Friday, ending the week in cautious trading in line with major regional markets as foreign investors liquidated regional stocks to benefit from the recovery in the US on the backdrop of improved sentiment in global market as well as concern on China's growth. The benchmark FBM KLCI was down 7.98 points or 0.51% to close at 1,571.40, after opening 1.1 point higher at 1,580.48, and week-on-week, it fell 7.6 points from 1,579 previously. Gainers outnumbered losers by 437 to 330, while 343 counters were unchanged. Turnover surged higher to 2.414 billion shares worth RM1.926 billion from 1.359 billion shares valued at RM1.731 billion on Thursday. Total weekly volume decreased to 7.479 billion units worth RM8.609 billion from 7.556 billion units worth RM8.631 billion the previous week.

The FBM KLCI started last week on a bearish tone by falling 14.25 points to close Monday at 1,564.75 on cautious sentiment. The key index continued to consolidate on Tuesday to closed 0.73 of a point lower at 1,564.02 after hitting the intra-week low of 1,562.97. Buoyed by external developments in the United States and the Euro zone, a stronger-than-expected retail sales in the US and comments from the Federal Reserve that financial market strain was easing, as well as, news that most US banks passed their annual stress test lifted global equity markets, the FBM KLCI ended 11.69 points higher at 1,575.71 on Wednesday. The FBM KLCI rose another 3.67 points on Thursday to close at 1,579.38, and on Friday the key index experienced heavy profit-taking to close 7.98 points at 1,571.40.

On the weekly chart, the FBM KLCI formed a black spinning-top candlestick which indicates indecision of market direction with a downward bias. As this is a second black spinning-top candlestick formed in two weeks, it indicated that the market was in a correction and consolidation mode after hitting a high of 1,594.72, and the FBM KLCI is likely to continue its consolidation mode this week. Nevertheless, as the key index is still closing above the 5 and 10-week SMA, the underlying uptrend is still intact.

On the daily chart, the FBM KLCI formed a bearish engulfing candlestick pattern after hitting the intra-day high of 1,583.55, indicating heavy profit-taking activity. With this bearish down move, the key index is likely to further consolidate itself today. Immediate downside support zone is at 1,570 to 1,562 while the overhead resistance zone is at 1,583 to 1,594.

Weekly MACD continued to move higher but is tapering off, while its histogram continued to turn shorter, indicating a loss in the upward momentum. On the contrary, the daily MACD continued to slide lower, indicating a further consolidation of the key index. Weekly RSI (14) was lower at 62.1, reflecting the pullback correction, and daily RSI (14) has slid lower to 54.8, indicating a loss in the short term relative strength to a mildly bullish state. Weekly Stochastic was lower at 90.4, indicating a loss in the weekly market strength, while the daily stochastic was higher at 54.3. Mixed signals from the weekly and daily indicators showed that the FBM KLCI is in a consolidation phase which is likely to extend.

With the bearish close on last Friday, the rebound was probably over as the FBM KLCI is again closing below the short term 5 and 10-day SMA, indicating a short term correction; however, as it is still above the 20 and 30-day SMA, the short term trend is still up. A critical level to watch is the 1,565-point support level provided by the 30-day SMA, a break below this level would indicate the short term is turning bearish. Nevertheless, the medium and longer term uptrend is still intact. For this week, the FBM KLCI is likely to stay sideways range-bound with a downward bias.

Last Friday, the Dow fell -20.14 points or -0.15% to close at 13,232.62. This week, the FBM KLCI is likely to trade within a range of 1,541 to 1,605, and for today, it is likely to trade within a range of 1,554 to 1,596.

This week's expected range: 1541 – 1605
Today’s expected range: 1554 – 1596

Resistance: 1580, 1588, 1596
Support: 1554, 1562, 1567

FBM KLCI - higher on follow through buying

Stocks on Bursa Malaysia closed broadly lower on cautious trading yesterday, amid concerns over the extent of China's economic slowdown. The local market is likely to remain in consolidation mode in the near-term, given the limited investor participation during the school holidays as most market players remained on the sidelines. The FBM KLCI, however, rose 3.67 points or 0.23% to close at 1,579.38, reflecting investors' appetite towards high-price blue chip stocks, which were more defensive. Decliners led advancers by 443 to 296 while 367 counters were unchanged. A total of 1.359 billion shares, worth RM1.731 billion, changed hands compared with 1.273 billion shares, worth RM1.845 billion, registered on Wednesday.

The FBM KLCI opened 0.32 point higher at 1,576.03 and surged to the intra-day high of 1,579.45 within the first thirty minutes. The key index reversed its uptrend on profit-taking activity to touch the intra-day low of 1,574.59, and it rebounded to climb higher gradually for the rest of the day to end near the day’s high. Chart-wise, the FBM KLCI formed a bullish small white candlestick which indicates a continuation of the uptrend resulted from the reversal two days ago. The key index is likely to continue its upward move today with immediate overhead resistance envisaged at 1,582-point level, and a break above this level is likely to see the FBM KLCI moving higher to re-test the recent high of 1,594.72 registered on 5th March.

MACD was marginally lower and is tapering off, while the histogram continued to turn shorter upward, indicating a reduction in the bearish momentum. RSI (14) was higher at 60.4, indicating the short term relative strength has improved to the bullish level. Stochastic has reversed up to 48.5 and crossed above the slow stochastic line, indicating a possible change in the short term market cycle from down to up. Readings from the indicators showed that the short term correction of the FBM KLCI is probably over and may continue to move higher.

The FBM KLCI has again regained its short term uptrend as it closed above the all the short term moving averages yesterday, while the medium and longer term uptrend still remained intact. Immediate overhead resistance zone is at 1,582 to 1,594 while the immediate downside support zone is at 1,574 to 1,562. With the overall volume remained weak, the general market is likely to remain sluggish and the focus may continue to be on the defensive blue-chip stocks.

Overnight, the Dow rose +58.66 points or +0.44% to close at 13,252.76. Today, the FBM KLCI is likely to trade within a range of 1,571 to 1,585.

This week's expected range: 1547 – 1617
Today’s expected range: 1571 – 1585

Resistance: 1581, 1583, 1585
Support: 1571, 1572, 1576

FBM KLCI - staged a strong rebound

Stocks on Bursa Malaysia rebounded yesterday with the FBM KLCI staying above the 1,575 points level buoyed by external developments in the United States and the Euro zone. Stronger-than-expected retail sales in the US and comments from the Federal Reserve that financial market strain was easing, as well as, news that most US banks passed their annual stress test lifted global equity markets. The FBM KLCI ended 11.69 points or 0.75% higher at 1,575.71 after opening 6.04 points better at 1,570.06. Gainers overwhelmed losers by 444 to 334 while 356 counters were unchanged. Some 1.273 billion shares, worth RM1.845 billion, changed hands compared with 1.163 billion shares, worth RM1.471 billion, registered on Tuesday.

Taking cue from the strong performance of Wall Street overnight, the FBM KLCI opened with an up gap of 6.04 points at 1,570.06 and climbed to the morning session high of 1,575.04. However, heavy profit-taking pressed the key index to the intra-day low of 1,568.41 before late buying of selected blue-chips lifted it to close at the highest point of the day. Chart-wise, the FBM KLCI formed a bullish white candlestick which staged a reversal after two days of bashing by the bears, and the key index is likely to continue its upward momentum to move higher today. Immediate overhead resistance is expected at the pivot high of 1,582.

MACD was marginally lower, but the histogram was slightly shorter upward, indicating a slow down in the bearish momentum. RSI (14) hooked upward to 58.6, indicating the short term relative strength has improved to become mildly bullish. Stochastic continued to slide lower but showed sign of tapering off, indicating a slow down in the downward momentum. Readings from the indicators showed that the FBM KLCI is still in a consolidation mode but already showed initial sign of a possible changed in momentum.

With the strong rebound yesterday, the FBM KLCI had closed above the short term 5 and 20-day SMA but is still below the 10-day SMA which is currently at 1,577.30, and a cross above this level will likely see the key index moving higher to re-test the next resistance level at 1,582. For the short term, the FBM KLCI is likely to continue to move sideways range-bound until a clear breakout of the pivot high at 1,594.72 is observed. Nevertheless, the medium and long term uptrend still remained intact. Since the school holiday started, the volume has reduced drastically and it is likely to remain in the same level as of now.

Overnight, the Dow gained +16.42 points or +0.12% to close at 13,194.10. Today, the FBM KLCI is likely to trade within a range of 1,563 to 1,583.

This week's expected range: 1547 – 1617
Today’s expected range: 1563 – 1583

Resistance: 1579, 1581, 1583
Support: 1563, 1565, 1570

FBM KLCI - marginally lower on consolidation

Stocks on Bursa Malaysia closed on a softer note yesterday from selling activities, mainly in finance-related and small cap stocks. The weaker local bourse performance was an indication of its defensive stance unlike a steadier trend seen in the global equity markets in anticipation of an encouraging outcome from the Federal Reserve policymakers meeting later yesterday. The benchmark FBM KLCI closed 0.73 of a point lower at 1,564.02. Losers outnumbered gainers by 469 to 288 while 329 counters were unchanged. Total market volume dwindled to 1.163 billion shares worth RM1.471 billion from Monday’s close of 1.268 billion units valued at RM1.717 billion.

The FBM KLCI opened 0.09 of a point higher at 1,564.84 and surged to the intra-day high of 1,569.15 within the first thirty minutes after opening. Profit-taking activity which appeared pulled the key index off high and fluctuated in a sideways range. Some late selling activity further pushed the key index lower at close. Chart-wise, the FBM KLCI formed a black inverted hammer candlestick which is a bottom reversal candle pattern. However, as it is a black candlestick, the bear is still slightly dominant. Hence, the FBM KLCI may continue to consolidate or stage a rebound today. Immediate downside support is at 1,559 provided by the 30-day SMA.

MACD continued to slide lower, indicating a continued loss in momentum amid the consolidation process. RSI (14) was marginally lower at 52.1 and is tapering off, indicating a slow down in the downward move, and the short term relative strength is neutral with a bullish bias. Stochastic continued to plunge lower to 39.5, indicating a continued weakening of the market strength and the short term down cycle is still in continuation. Readings from the indicators showed that the FBM KLCI is still in consolidation and the process may extend.

The short term trend of the FBM KLCI is down as the key index is closing below the short term 5, 10 and 20-day SMA. Nevertheless, the medium and longer term trend is still up. Immediate downside support zone is at 1,562 to 1,549 with a critical support level at 1,559 provided by the 30-day SMA, and a break below this support level will likely see the FBM KLCI turning more bearish. With the overall volume continued to shrink, the market is likely to further consolidate itself.

Overnight, the Dow rallied +217.97 points or +1.68% to close at 13,177.68. Today, the FBM KLCI is likely to trade within a range of 1,555 to 1,576.

This week's expected range: 1547 – 1617
Today’s expected range: 1555 – 1576

Resistance: 1568, 1572, 1576
Support: 1555, 1559, 1561

FBM KLCI - possible beginning of a bear trend?

Stocks on Bursa Malaysia headed south yesterday ending the day on cautious sentiment with the FBM KLCI closing below the 1,565-point level, as investors reduced their holdings as they continued to fret over China’s growth outlook following a huge trade deficit of US$31.5 billion in February further indicating slowdown in its economy, and the development in Greece’s debt issue. The benchmark FBM KLCI fell 14.25 points or 0.90% to close at 1,564.75 after opening 0.83 of a point better at 1,579.83. Losers led gainers by 516 to 260 while 318 counters were unchanged. Total market volume fell to 1.268 billion units valued at RM1.717 billion, from last Friday’s 1.306 billion shares valued at RM1.367 billion.

The FBM KLCI opened 0.83 point higher at 1,579.83 and surged to the intra-day high of 1,580.08 in early morning trade. Selling pressure which surfaced pushed the key index lower for the rest of the day which hit the intra-day low of 1,563.73 before rebounding slightly to close off low. Chart-wise, the FBM KLCI formed a bearish long black candlestick which indicates reversal down after the appearance of a Doji candlestick on last Friday. With the bearish downward move yesterday the FBM KLCI had broken the support level at 1,567 and is likely to slide lower to test the next lower support zone of 1,558 to 1,549.

MACD continued to slide lower, indicating a pick up in the downward momentum. RSI (14) plunged lower to 52.6, indicating the short term relative strength has turned from bullish to neutral. Stochastic has slid lower to 50.8, indicating continued loss in market strength and the short term down cycle. Readings from the indicators showed that the FBM KLCI is undergoing a heavy correction and the consolidation process is likely to extend.

The short term trend of the FBM KLCI has turned bearish following yesterday’s heavy downward move, and the key index is now closing below the short term 5, 10 and 20-day SMA, marking the beginning of a short term down trend, and it is likely to slide lower to test the 30-day SMA support at 1,558. Nevertheless, the medium and longer term trend still remained up. The FBM KLCI has also closed below the middle line of the uptrend channel, indicating the current trend is turning to bearish bias, and the critical lower support is at the lower trend line which is now at 1,540.

Overnight, the Dow rose +37.69 points or +0.29% to close at 12,959.71. Today, the FBM KLCI is likely to trade within a range of 1,542 to 1,597.

This week's expected range: 1547 – 1617
Today’s expected range: 1542 – 1597

Resistance: 1576, 1586, 1597
Support: 1542, 1553, 1558

FBM KLCI - likely to be range-bound with an upward bias

Stocks on Bursa Malaysia closed mixed last Friday as traders firmed their position ahead of the weekend. Although strong interest from foreign investors was seen in the market, profit taking had offset earlier gains. The benchmark FBM KLCI inched up 0.64 of a point to close at 1,579 after having moved between 1,577.23 and 1,582, while on a weekly basis, the FBM KLCI fell 4.78 points from 1,583.78 previously. Decliners led advancers by 388 to 369 while 344 counters closed unchanged. Total volume amounted to 1.306 billion shares valued at RM1.367 billion compared with 1.769 billion shares valued at RM1.763 billion registered on Thursday. Weekly volume declined to 7.556 billion shares valued at RM8.631 billion from previous week’s 8.560 billion shares worth RM9.87 billion.

The FBM KLCI opened last Monday 2.87 points higher at 1,586.65 and rallied to hit the intra-week high of 1,594.72 before profit-taking set in which pressed the key index to close 5.44 points higher 1,589.22. Stocks on Bursa Malaysia closed broadly lower on Tuesday in line with weak regional markets while the FBM KLCI recouped earlier losses to close 0.69 of a point higher at 1,589.91 aided by selected buying of blue-chips. Wednesday saw the FBM KLCI declined 15.08 points to 1,574.83 against a backdrop of negative global economic conditions. On Thursday, the benchmark FBM KLCI rebounded to finish 3.53 points higher at 1,578.36 supported by foreign institutional buying amid improved global economic sentiment, and the benchmark market barometer inched up another marginal 0.64 of a point to end last week at 1,579.00.

On the weekly chart, the FBM KLCI formed a black spinning-top candlestick in a dark-cloud-cover position which indicates indecision of market direction amid active profit-taking activity. As the last candlestick did not close below the mid-point of the previous candle, the profit-taking activity is considered mild, and when the profit-taking activity is over, the key index is likely to continue its uptrend to move higher to re-test the historical high level of 1,597.08 follow by the target of 1,600-point.

On the daily chart, the FBM KLCI formed a Doji candlestick which indicates indecision of market direction as the broad market was in a consolidation mode ahead of the weekend. The key index is currently still trapped within the range of 1,585 to 1,572 of the long black candlestick formed last Wednesday, a breakout on either one the top or bottom level will see the FBM KLCI continue moving in the breakout direction.

Weekly MACD continued to move higher but its histogram was marginally lower, indicating a mild reduction in the upward momentum. On the contrary, daily MACD had made a dead-cross over the daily signal-line, flashing out a short term sell signal. Nevertheless, as the daily MACD is still above the zero-line, the current weakness is being viewed as just a short term correction. Weekly RSI (14) has made a mild pulled back to 64.3 from 65.6 the previous week, reflecting the mild profit-taking activity last week. Daily RSI (14) was marginally higher at 63 from 62.7 previously, reflecting a weak rebound. The readings of both weekly and daily RSI showed that the relative strength of the FBM KLCI is still bullish. Weekly Stochastic has slid lower to 93.8 from 95.2 and is below the weekly slow stochastic line, indicating weakness is surfacing. Daily stochastic has continued to slide lower to 58.8, indicating a continuation of the down cycle and continued weakening of the market strength. Readings from both the weekly and daily indicators showed that the FBM KLCI is in a short term consolidation mode with a still bullish undertone, and the key index is likely to continue its uptrend after the correction phase is over.

The FBM KLCI is currently undergoing a short term correction and consolidation phase. Nevertheless, the general trend is still up as the key index is still staying above majority of the short, medium and long term moving averages. Immediate overhead resistance zone is at 1,582 to 1,585 while the immediate downside support zone is at 1,577 to 1,572. With the volume continuously shrinking, the FBM KLCI may continue to move range-bound until a firm breakout of 1,585-point level is seen.

Last Friday, the Dow rose +14.08 points or +0.11% to close at 12,922.02. This week, the FBM KLCI is likely to trade within a range of 1,547 to 1,617, and for today, it is likely to trade within a range of 1,572 to 1,587.

This week's expected range: 1547 – 1617
Today’s expected range: 1572 – 1587

Resistance: 1582, 1585, 1587
Support: 1572, 1574, 1576

FBM KLCI - bullish Harami candle formation

Stocks on Bursa Malaysia closed marginally higher yesterday supported by foreign institutional buying amid improved global economic sentiment. Strong buying interest was noted by foreign investors driven by the fact that mega projects were scheduled to kick off this year under the government’s Economic Transformation Programme. The benchmark FBM KLCI finished 3.53 points or 0.22% higher at 1,578.36 after fluctuating between 1,576.17 and 1,580.41 throughout the day. Decliners led advancers by 415 to 336 while 339 counters closed unchanged. Total volume climbed to 1.769 billion shares, valued at RM1.763 billion, from 1.742 billion shares, valued at RM2.03 billion, registered on Wednesday.

Taking cue from the rebound on Wall Street overnight, the FBM KLCI opened 1.53 points higher at 1,576.36 and surged to the intra-day high of 1,580.41 within the first thirty minutes, and profit-taking activity which emerged pressed the key index lower and fluctuated in a narrow range for the rest of the day. Chart-wise, the FBM KLCI formed a small white inverted hammer candlestick in Harami position which indicates a rebound on cautious buying. A bullish Harami formation is a key reversal candle pattern which indicates a possible change in the dominant market force direction, and hence, the key index is likely to see a follow through rebound today with immediate overhead resistance level at 1,580 while the immediate downside support level is at 1,572.

MACD continued to slide lower and is staying just above the signal-line, indicating a further loss in the momentum and consolidation, and a cross-over below the signal-line would flash a short term sell signal. RSI (14) hooked upward to 62.7, reflecting the weak rebound. Nonetheless, the short term relative strength is still in the bullish zone. Stochastic continued to slide lower to 68.3, indicating the short term down cycle is in continuation. Readings from the indicators showed that the FBM KLCI is in consolidation mode, however, the undertone still remained bullish.

The main trend of the FBM KLCI remained up, and yesterday’s rebound had managed to keep the key index above the middle uptrend line of the trend channel. However, the key index is currently trapped between the 5 and 10-day SMA, and may continue to consolidate until a break above or below these two immediate short term moving averages. Total volume was just marginally higher, and as the weekend is approaching, profit-taking activity may prolong the consolidation process.

Overnight, the Dow rose +70.61 points or +0.55% to close at 12,907.94. Today, the FBM KLCI is likely to trade within a range of 1,571 to 1,585.

This week's expected range: 1527 – 1622
Today’s expected range: 1571 – 1585

Resistance: 1581, 1583, 1585
Support: 1571, 1574, 1576

FBM KLCI - lower on correction

Stocks on Bursa Malaysia ended broadly lower in cautious trade yesterday against a backdrop of negative global economic conditions. External factors, including the weaker performance on Wall Street and renewed concerns over the Eurozone debt crisis, affected investor sentiment across the region. The benchmark FBM KLCI declined 15.08 points or 0.95% to close at 1,574.83 after opening 4.61 points lower at 1,585.30. Decliners led advancers by 476 to 283 while 314 counters were unchanged. Total volume rose to 1.742 billion valued at RM2.03 billion from 1.288 billion shares valued at RM1.792 billion on Tuesday.

Taking cue from the weak performance of Wall Street overnight, the FBM KLCI opened with a down gap of 4.61 points at 1,585.30 and slid lower to the intra-day low of 1,572.43 within the first half and hour after opening, losing 17.48 points at its worst. The key index rebounded but continued to stay in the negative territory. Chart-wise, the FBM KLCI formed a bearish black candlestick with a downside break away gap which indicates great fear in action, and this served to confirm the top reversal signals appeared two days ago. The key index is likely to further correct itself with an immediate downside support at 1,571 provided by the 10-day SMA.

MACD hooked downward, indicating a pulled back in the upward momentum. Nevertheless, as it is still above the signal-line, the currently weakness may just be part of a correction. RSI (14) plunged to 61.1 from 74.2 a day earlier, indicating the short term relative strength has reduced to bullish from the very bullish state two days ago. Stochastic hooked downward to 77.3 and has crossed below the slow stochastic line, indicating the possible beginning of a short term down cycle. Readings from the indicators showed that the FBM KLCI is experiencing a correction but the bullish undertone was unchanged.

The FBM KLCI has closed below the 5-day SMA, indicating a pullback is in action. However, it is still above the 10-day SMA which may provide support to the correction. Nevertheless, the general trend of the FBM KLCI still remained up. Immediate downside support zone is at 1,572 to 1,567 while the overhead resistance zone is at 1,585 to 1,595. The general market is likely to continue to consolidate. Nevertheless, this might present a buying opportunity for quality stocks as the FBM KLCI is likely to continue its uptrend after the correction.

Overnight, the Dow rose +78.18 points or +0.61% to close at 12,837.33. Today, the FBM KLCI is likely to trade within a range of 1,556 to 1,598.

This week's expected range: 1527 – 1622
Today’s expected range: 1556 – 1598

Resistance: 1583, 1591, 1598
Support: 1556, 1564, 1569

Stocks to watch: HWGB, NICORP, BRAHIMS

FBM KLCI - signs of toppishness

Stocks on Bursa Malaysia closed broadly lower yesterday in line with weak regional markets, as regional and international equity markets were discouraged by China's revised economic growth forecast to 7.5 percent against an earlier projection of eight percent. The FBM KLCI recouped earlier losses to close 0.69 of a point or 0.04% higher at 1,589.91 aided by selected buying of blue-chips. Decliners led advancers by 519 to 257 while 315 counters closed unchanged. Total volume reduced to 1.288 billion shares, valued at RM1.792 billion, from 1.448 billion shares, valued at RM1.760 billion, transacted on Monday.

The FBM KLCI opened 0.12 of a point lower at 1,589.10 and slipped to the intra-day low of 1,580.51 at mid day. The key index recovered its losses gradually in the afternoon session and a last minute buying of selected blue-chips helped to push the market barometer to close at the day’s high. Chart-wise, the FBM KLCI formed a white hanging-man candlestick, a top reversal candle pattern which indicates the bears were initially dominant in push the key index lower but the bulls later surfaced to lift up the index. With the appearance of two key reversal candlestick patterns, i.e. a shooting-star and a hangman at this high level, it indicated that selling pressure has emerged and hence the FBM KLCI is likely to pullback and correct itself after a four-day rally.

MACD continued to move higher, indicating the upward momentum is still intact. RSI (14) was higher at 74.2, but is tapering off, indicating a marginal increase in the short term relative strength, and the key index was at the overbought level for the short term. Stochastic was flat at 89.4, indicating the upward move was taking a pause. Readings from the indicators showed that the FBM KLCI is short term overbought and is making a pause, and might correct itself.

The trend of the FBM KLCI remained up and bullish. However, with the appearance of two key reversal candlestick patterns at this high level, the key index is likely to move lower to correct itself after the recent strong up move. Immediate overhead resistance zone is at 1,595 to 1,600 while the immediate downside support zone is at 1,580 to 1,567. The overall market is likely to go into a consolidation phase as can be seen from the shrinking volume. Nevertheless, this might present a buying opportunity for quality stocks as the FBM KLCI is likely to continue its uptrend after the correction.

Overnight, the Dow fell -203.66 points or -1.57% to close at 12,759.15. Today, the FBM KLCI is likely to trade within a range of 1,574 to 1,600.

This week's expected range: 1527 – 1622
Today’s expected range: 1574 – 1600

Resistance: 1594, 1597, 1600
Support: 1574, 1577, 1583

FBM KLCI - appearance of shooting-star candle pattern

Stocks on Bursa Malaysia closed higher yesterday on gains in selected blue-chips. Although the market failed to make a breakthrough yesterday the momentum has been set for it to further move up and try breaks the resistance in the near term. The FBM KLCI rose 5.44 points or 0.34% to close at 1,589.22 after hitting the intra-day high of 1,594.72. Advancers led decliners by 391 to 325 while 414 counters were unchanged. Total volume declined to 1.448 billion shares valued at RM1.760 billion from 1.630 billion shares valued at RM1.934 billion last Friday.

The FBM KLCI opened 2.87 points higher at 1,586.65 and continued moving higher to touch the intra-day high of 1,594.72 at mid morning. Profit-taking activity sets in and sent the key index lower for the rest of the day to close off high. Chart-wise, the FBM KLCI formed a white shooting-star candlestick which indicates the bulls were initially dominant but later the bears surfaced to press down the key index. A shooting-star candlestick is a potential top reversal candle formation, and hence, the FBM KLCI is likely to pullback on profit-taking.

MACD continued to climb higher after making the golden-cross, indicating a good follow through buying momentum which pushed the key index higher. RSI (14) was higher at 73.9, indicating a very bullish short term relative strength; however, as it has gone into the short term overbought zone, a pullback on profit-taking is likely to happen. Stochastic was higher at 89.4, indicating very strong market strength and continuation of the up cycle, but is has showed sign of tapering off, hence the up move may take a pause. Readings from the indicators showed that the FBM KLCI is currently in a very bullish state, but is short term overbought, hence might pullback to correct itself.

The trend of the FBM KLCI is up and bullish, and it is likely to test the all-time-high level of 1,597.08 in the near term. As there are already signs of toppishness, the key index may pullback first before scaling new high. Immediate overhead resistance zone is envisaged at 1,597 to 1,600 while the downside support zone is at 1,586 to 1,577. With total volume continued to shrink, the overall market is likely to go into consolidation mode but the focus on index-linked counters will stay.

Overnight, the Dow fell -14.76 points or -0.11% to close at 12,962.81. Today, the FBM KLCI is likely to trade within a range of 1,576 to 1,604.

This week's expected range: 1527 – 1622
Today’s expected range: 1576 – 1604

Resistance: 1594, 1599, 1604
Support: 1576, 1581, 1585

FBM KLCI - likely to test all-time historical high

Stocks on Bursa Malaysia closed sharply higher last Friday, prompted by firmer regional markets. The benchmark FBM KLCI rose by 10.33 points or 0.66% to close at 1,583.78, and on a weekly basis, it gained 25.01 points from the previous Friday’s close of 1,558.77. Advancers led losers by 540 to 276 while 330 counters were unchanged. Turnover rose to 1.63 billion shares worth RM1.93 billion from 1.62 billion shares worth RM2.02 billion on Thursday. Weekly volume decreased to 8.560 billion shares worth RM9.87 billion from 9.635 billion shares worth RM9.345 billion the previous week.

The FBM KLCI opened 1.86 points higher at 1,560.63 on last Monday but ended the day only 0.27 of a point higher to close at 1,559.04 with profit-taking activities seen in selected blue-chip counters. Investor sentiment was dampened following an increase in oil prices and the absence of a new catalyst for markets regionally. The FBM KLCI ended 2.31 points lower at 1,556.73 on Tuesday on continued profit-taking activity after hitting intra-week low of 1,552.62. On Wednesday, the market rebounded from Tuesday’s losses amid advances in regional bourses as financing from the European Central Bank to avert a credit crunch in the Euro zone bolstered investors’ confidence, and the key index gained 12.92 points to 1,569.65. The FBM KLCI rose by 3.80 points to close at 1,573.45 on Thursday amid a mixed market. On Friday, the benchmark continued its climb to touch the intra-week high of 1,587.11 before pulling back on profit taking to close the week at 1,583.78.

On the weekly chart, the FBM KLCI formed a bullish white candlestick which staged a breakout from the consolidation. With this bullish breakout, the benchmark index is likely to move higher to re-test the historical high of 1,597.08 registered on July 11th, 2011 with an immediate target of 1,600-point. A successful breakthrough of the 1,600-point level may even see the FBM KLCI moving higher with a possible target level of 1,675. On the daily chart, the FBM KLCI formed a bullish white candlestick, with a three-white-soldiers candle pattern formation, which indicates a very bullish upward move. The breakthrough of the 1,577 resistance level with strong conviction indicates the benchmark index is likely to move higher to re-test the historical high level of 1,597.08 sometimes this week.

Weekly MACD continued to move higher with its histogram also turning longer, indicating the weekly momentum has again pick up after two weeks of consolidation. Daily MACD also continued its up move after hooking up two sessions ago and has just made a golden-cross, issuing a bullish buy signal. Weekly RSI (14) was higher at 65.6 from 61.7 a week ago, indicating the weekly relative strength is turning more bullish. Daily RSI (14) surged higher to 72 from 67.9, and has entered the very bullish zone. It is short term overbought, and some profit-taking maybe expected ahead. Weekly Stochastic was at 95.2, indicating a very strong weekly market strength, and daily stochastic was higher at 88.5, indicating a continuation of the daily up cycle and a strong daily market strength. Readings from the weekly and daily indicators showed that the FBM KLCI is currently is a very bullish state, and its bullish momentum is likely to carry it to a higher level with some profit-taking along the way.

The trend of the FBM KLCI remained up and is bullish. Immediate overhead resistance zone is envisaged at 1,597 to 1,600 while the downside support zone is at 1,577 to 1,567. From the fundamental side, a better global sentiment, strong US jobs data, positive China manufacturing data and better credit market in the Eurozone will provide an upside momentum to share prices on Bursa Malaysia.

Last Friday, the Dow fell a marginal -2.73 points or -0.02% to close at 12,977.57. This week, the FBM KLCI is likely to trade within a range of 1,527 to 1,622, and for today, it is likely to trade within a range of 1,549 to 1,566.

This week's expected range: 1527 – 1622
Today’s expected range: 1564 – 1600

Resistance: 1589, 1595, 1600
Support: 1564, 1569, 1576

FBM KLCI - higher amid mixed market

Stocks on Bursa Malaysia closed on a mixed note yesterday in cautious trading in line with regional markets, weighed by a higher yen and weak China’s manufacturing data. News that Federal Reserve chairman Ben Bernanke had no plans to further ease monetary policy to stimulate the US economy also dampened sentiment. The FBM KLCI rose by 3.80 points or 0.24% to close at 1,573.45, helped by gains in heavyweights. Losers led gainers by 506 to 309 while 302 counters were unchanged. Turnover fell to 1.62 billion shares worth RM2.02 billion from Wednesday’s 1.94 billion shares worth RM2.69 billion.

The FBM KLCI opened 0.76 of a point lower at 1,568.89 and rebounded to climb higher after briefly touching the intra-day low of 1,568.83. It hit the intra-day high of 1,576.23 near noon before pulling back on profit-taking in the afternoon to close off high. On the daily chart, the FBM KLCI formed a bullish white candlestick which indicates the bulls are still in control and continuation of the uptrend after the strong breakout a day earlier. The FBM KLCI is likely to move higher today, and immediate overhead resistance is at 1,577-point level. If the key index is able to break through this resistance level then it will move towards its next target which is the all time high level of 1,597.08.

MACD continued its rebound to climb high and so is the histogram, indicating continued improvement in the key index’s momentum. Nevertheless, MACD is still below the signal-line. RSI (14) was higher at 67.9, indicating the short term relative strength of the key index is getting more bullish. Stochastic hooked up to 75.5 and has crossed above the slow stochastic line, indicating the short term corrective cycle is over and a new up cycle is in the making. Readings from the indicators showed that the FBM KLCI’s momentum is picking up and is likely to send it to a higher level.

The short term trend of the FBM KLCI has again turned up as the 5-day SMA has crossed above the 10-day SMA, and overall, the key index is still on a steady uptrend. Immediate overhead resistance zone is at 1,577 to 1,582 while the downside support zone is at 1,567 to 1,553. The index-linked heavyweights are likely to continue their uptrend with potential profit-taking ahead of the weekend, and the second and third liners are likely to continue their correction and consolidation.

Overnight, the Dow rebounded +28.23 points or +0.22% to close at 12,980.30. Today, the FBM KLCI is likely to trade within a range of 1,562 to 1,584.

This week's expected range: 1541 – 1577
Today’s expected range: 1562 – 1584

Resistance: 1577, 1581, 1584
Support: 1562, 1565, 1569

FBM KLCI - a bullish breakout

Stocks on Bursa Malaysia closed sharply higher yesterday with the benchmark FBM KLCI surging 12.92 points to 1,569.65, the highest level since July 18 last year. The market rebounded from Tuesday’s losses amid advances in regional bourses as financing from the European Central Bank to avert a credit crunch in the Euro zone bolstered investors’ confidence. Gainers led losers by 535 to 297 while 300 counters were unchanged. Turnover was higher at 1.94 billion shares worth RM2.69 billion from 1.7 billion shares worth RM1.6 billion on Tuesday.

Taking cue from the strong performance of Wall Street overnight, the FBM KLCI opened 0.77 point higher at 1,557.50 and continued to climb higher throughout the day to touch the intra-day high of 1,573.75 before last minute profit-taking pressed the key index to close off high. Chart-wise, the FBM KLCI formed a bullish white candlestick which broke above the resistance level of 1,567-point, and is likely to continue climbing higher today. With this strong breakout, the key index is likely to move higher to test the next target level of 1,577-point follow by the all time high level of 1,597.08.

MACD has hooked upward and the histogram also turned shorter upward, indicating an initial turn in the momentum direction from down to up. RSI (14) has hooked upward sharply to 66.3, indicating a strong increase in the key index’s short term relative strength, which has again back to the bullish zone. Stochastic was slightly lower at 67.3, and starts to taper, indicating a slow down in the downward market strength. Readings from the indicators showed that the FBM KLCI is regaining its upward momentum which may push it to a higher level.

The short term trend of the FBM KLCI has again turn up after two week’s of sideways consolidation, while the medium and longer term uptrend still remained intact. With the bullish breakout yesterday, the benchmark index is likely to move higher to another level with the short term target set at the all time high level of 1,597.08. With the volume again pick up, the broad market will remain active and buoyant.

Overnight, the Dow fell -53.05 points or -0.41% to close at 12,952.07. Today, the FBM KLCI is likely to trade within a range of 1,543 to 1,590.

This week's expected range: 1541 – 1577
Today’s expected range: 1543 – 1590

Resistance: 1577, 1584, 1590
Support: 1543, 1550, 1560

Stocks to watch: GHLSYS, N2N, WELLCAL, CYPARK, JCY