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Tuesday, May 4, 2010

FBM KLCI - closed marginally higher


Stocks on Bursa Malaysia ended broadly lower today on weak sentiments following Wall Street’s weak performance last Friday. Regional bourses were also mainly in the red. The FBM KLCI opened the first trading day of May 2.14 points lower at 1,344.24 and touched the intra-day low of 1340.26 before buying support on selected blue-chips pushed the benchmark index to close 0.51 of a point or 0.04% higher at 1,346.89. Market breadth was negative throughout the day with losers beating gainers by 456 to 254, while 268 counters were unchanged. Turnover was lower at 771 million shares valued at RM1.031 billion.

Chart wise, the FBM KLCI formed a white candlestick with long lower shadow, it indicates buying support from the bulls after the bear sold down the market in the early part of the day. The key index in fact closed at another two-year high since March 3, 2008. It is now struggling trying to clear the immediate strong overhead resistance at the 1347 to 1354 zone.

MACD continued to move higher despite still below its trigger line, indicating a gradual pickup in daily market momentum. RSI(14) at 63.75 turned flat but still in the bullish zone. Stochastic at 85 is gaining strength, continued to move higher and is now entering the short term overbought or bullish zone. Readings from the indicators indicates the FBM KLCI is turning bullish gradually and might continue to move higher.

The underlying short, medium and long term trends of the FBM KLCI remained up as the key index is currently staying above all the moving averages.

In view of the continue release of corporate earnings results in this month, the performance of the FBM KLCI will very much depend on those figures, while the developments in overseas market will also continue to dictate the main direction of the key index. Rotational play on the second and third liners is likely to continue.

Today, the FBM KLCI is likely to trade within a range of 1335 to 1355.

This week's expected range: 1307 – 1372
Today’s expected range: 1335 – 1355

Resistance: 1349, 1352, 1355
Support: 1335, 1338, 1342

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