Stocks on Bursa Malaysia closed
firmer yesterday as investors took cue from the uptrend on regional bourses. The
favourable outcome of the general election in Greece, which saw pro-bailout
political parties winning an adequate number of parliamentary seats to form a
new government, served as a positive impetus for regional equity markets. The
FBM KLCI gained 3.5 points or 0.22% to close at 1,582.73 after hitting an
intra-day high of 1,588.54. Gainers thumped losers by 500 to 236 while 281
counters were unchanged. Turnover softened to 941.093 million shares worth
RM1.637 billion from the 979.94 million units, valued at RM2.418 billion posted
on Friday.
Taking cue from the favourable result of the Greece election,
the FBM KLCI opened with an up gap of 4.12 points at 1,583.35 and climbed to
the intra-day high of 1,588.54 within the first ten minutes of trading. This
was followed by heavy profit-taking which pressed the key index lower and
traded in a narrow range; it hit the intra-day low of 1,582.25 before
rebounding slightly to close off low. Chart-wise, the FBM KLCI formed a black
inverted hammer candlestick or commonly known as a shooting star candlestick
formation, which is a top reversal candle pattern. It indicated heavy
profit-taking activity after an initial up move, and hence the FBM KLCI is
likely to fall further to close the up gap and consolidate itself today.
Immediate support zone is at 1,582 to 1,579 while the overhead resistance zone
is at 1,588 to 1,591.
MACD climbed higher, and so is the histogram, indicating an
increased in the upward momentum. RSI (14) was higher at 57.1, indicating a
continued improvement in the short term relative strength in the mildly bullish
zone. Stochastic was however marginally lower at 80.1 from 80.5 previously,
indicating an inherent weakness is possibly developing and a correction might
be expected ahead. Readings
from the indicators showed that the FBM KLCI is gradually gaining its upward
momentum but signs are there that it may undergo a correction.
The trend of the FBM KLCI has turned up as it is now closing
above all the short, medium and long term moving averages. However, the key
index must close above the 1,591-point level in order for it to gain further
strength to rally higher. Otherwise, it may continue to move sideways
range-bound. With the overall volume improving, the market is likely to see
some rotational play on the second and third liners.
Overnight, the Dow fell -25.35 points or -0.20% to close at 12,741.82.
Today, the FBM KLCI is likely to trade within a range of 1,574 to 1,595.
This week's expected range: 1561 – 1594
Today’s expected range: 1574 – 1595
Resistance: 1587, 1591, 1595
Support: 1574, 1578, 1580
Stocks to watch: TIMECOM, DRBHCOM, MALTON, L&G, MRCB
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