As it was forewarn in yesterday’s technical study, share prices on Bursa Malaysia retreated from a year’s high to close broadly lower due to heavy profit taking. Continuous selling activities sent the benchmark FBM KLCI to close at the low of the day at 1260.06 (-5.68, -0.45%) on Wednesday.
The index opened with a slightly bullish tone at 1267.64 and retested Tuesday’s high of 1270 resistance level, but failed, the bear surfaced to sell down. The hourly chart formed a double top chart pattern which is bearish, and on the daily candlestick chart, a bearish engulfing pattern was formed, confirming yesterday’s shooting star formation. Volume traded drop slightly to below 1 billion shares at 926 million shares. Losers outnumbered gainers at 519 to 214, 219 counters were unchanged. Further weakness is expected today.
MACD turn flat, and the MACD histogram has turn down, showing signs of weakening in momentum. RSI has hooked down, and so is Stochastics, indicating further weakness is expected ahead. The medium to long term trend is still up, short term is expected to be down.
The CI is expected to trade within the range of 1246-1267 today, immediate support for the KLCI is expected at 1256, 1253, and 1246. Resistance is at 1263 and 1267.
This week's expected range: 1238 – 1282
Today's expected range: 1246 – 1267
Resistance: 1263, 1267, 1270
Support: 1246, 1253, 1256
Stock to watch: EVERGRN
Disclaimer: The above is not a recommendation to buy or sell, all suggestions mentioned are purely for academic study purposes for our trend trader club members only, and the author may have personal interest and position in some of the examples mentioned. Any losses incurred if you were to trade base on the study examples above is solely your own responsibility. Do consult your dealer before taking any action
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