Stocks on Bursa Malaysia closed marginally higher last Friday, despite mixed trading in the regional markets due to renewed concerns over the European financial crisis, as Spain had revived fiscal concerns with its 10-year benchmark bond yield rising to 5.8 percent, the highest in five months. The benchmark FBM KLCI finished 5.43 points or 0.34% higher at 1,598.87, and week-on-week, it gained 2.54 points from 1,596.33 previously after recorded the new all-time high of 1,609.33 on last Tuesday. Market breadth was positive with gainers led losers by 457 to 248 while 324 counters were unchanged. Turnover was higher at 1.28 billion shares worth RM1.14 billion from 1.14 billion shares worth RM1.22 billion on Thursday.
The FBM KLCI started last week with a bang which saw the benchmark FBM KLCI advancing 7.45 points to close Monday at 1,603.78, surpassing the previous all-time high of 1,597.08, in line with a rally in the regional markets, and supported by gains in banking stocks. The FBM KLCI registered another new intra-day record high of 1,609.33 before settling at 1,606.63 on Tuesday, charting another new record close. Stocks on Bursa Malaysia closed lower on Wednesday on profit-taking, dampened by banking stocks amid weaker sentiments in the regional markets, as investors remained cautious due to the disappointed economic news from Europe and the United States, and the benchmark FBM KLCI declined 7.36 points to close at 1,599.27. Weaker sentiment in the Asian market brought on by a weak Spanish bond auction inflamed concerns about the European debt crisis as well as concerns on the US economy on Thursday, and the FBM KLCI declined another 5.83 points to 1,583.75. The market rebounded on Friday, and the FBM KLCI gained 5.43 points to finish the week at 1,598.87.
On the weekly chart, the FBM KLCI formed a white spinning-top candlestick with a slightly longer upper shadow which indicates uncertainty was surfacing in the market, and the longer upper shadow indicated the market was experiencing some selling pressure when it hit new record high. Hence, the FBM KLCI is likely to consolidate or further correct downward this week, with an immediate downside support zone at 1,590 to 1,573. On the daily chart, the FBM KLCI rebounded and formed a bullish white candlestick, and the key index is likely to move higher today. However, as the rebound last Friday managed to take the key index to a high of 1,600.60 but could not breakthrough the key psychological resistance level, the 1,600-point will continue to post as a strong resistance level.
Weekly MACD continued to climb higher, but its histogram was shorter, indicating the weekly upward momentum is weakening. Daily MACD continued to slide lower and so is the histogram, indicating a continued loss in the daily momentum, and hence, the FBM KLCI is likely to further consolidate itself from the daily perspective. Weekly RSI (14) was marginally higher at 66.7 from 66.3 previously and is tapering off, indicating a mild improvement in the weekly relative strength, and weakness could be developing. Daily RSI (14) has hooked upward to 61.7 from 58.7 previously, reflecting the rebound and change of the daily relative strength from mildly bullish to the bullish zone. Weekly Stochastic was higher at 94.4 from 91.6, indicating a marginal improvement of the weekly market strength. Daily stochastic, however, continued to slide lower to 67.8, indicating the continued weakening of the daily strength and a continuation of the short term down cycle. Readings from the weekly and daily indicators showed that the FBM KLCI is still bullish from the weekly perspective, while from the daily perspective it might continue to consolidate.
The overall trend of the FBM KLCI still remained up, as the key index continue to stay above all the short, medium and long term moving averages. The weekly indicators show that the key index is still in a bullish state, but there are signs from the weekly indicators that the upward momentum is weakening, and the benchmark FBM KLCI is poised for a correction. Nevertheless, the correction may be shallow and may post as an opportunity to buy low in an uptrend.
Last Friday, the US market was closed for Easter holiday. This week, the FBM KLCI is likely to trade within a range of 1,570 to 1,630, and for today, it is likely to trade within a range of 1,588 to 1,608.
This week's expected range: 1570 – 1630
Today’s expected range: 1588 – 1608
Resistance: 1602, 1605, 1608
Support: 1588, 1591, 1595
No comments:
Post a Comment