FBM KLCI - stood firmly above 1,500

Stocks on Bursa Malaysia ended mixed in range-bound trading yesterday but the key index increased 0.27%, supported by finance and plantation stocks. The FBM KLCI, which hovered at the 1,500 mark, advanced 4.00 points to close at 1509.66 after opening 5.03 points higher at 1510.69. Decliners outnumbered advancers by 440 to 343 while 317 counters were unchanged. Turnover dropped to 1.271 billion shares worth RM1.512 billion from 1.462 billion shares worth RM2.342 billion last Friday.

The FBM KLCI opened with an up gap of 5.03 points at 1510.69, and traded to the intra-day high of 1511.24 within the first five minutes. Heavy profit-taking activities immediately appeared and sent the key index to its intra-day low of 1506.31. The key index hover in a tight range for most part of the day, and a last minute buying of selected key heavyweights pushed the key index to close higher at 1509.66. Chart-wise, the FBM KLCI formed a black spinning-top candlestick which indicates indecision of the key index to move further, and was faced with heavy selling activities. The key index has now stood firm above the 1,500 psychological resistance level, and will try to challenge its next target levels at 1516 and 1524 soon.

MACD has turned upward, albeit still below its signal line, indicates a pick up in the upward momentum. In fact, its histogram has shown the subtle increase in upward momentum since four days ago. RSI (14) continued to climb higher into the overbought zone, and is at 73.8, indicates the key index is getting more bullish. Stochastic at 92.9 has moved higher into the short term overbought zone, and is expected to continue climbing higher. Signals from the indicators indicate that the FBM KLCI has regained its bullishness after the recent consolidation.

The underlying uptrend remained very strong and intact, as shown by the moving averages that are all pointing northeast. Immediate overhead resistance zone is now at 1511 to 1524, while the immediate downside support zone lies at 1500 to 1490. The overall market is expected to remain buoyant with lower liners continued to be in rotational play.

Overnight, the Dow rose a marginal +6.13 points or +0.06% higher to close at 11,124.62. Today, the FBM KLCI is likely to trade within a range of 1501 to 1516.

This week's expected range: 1481 – 1524
Today’s expected range: 1501 – 1516

Resistance: 1512, 1514, 1516
Support: 1501, 1504, 1506

Stocks to watch: CHUAN, CIHLDG, DIALOG, DNP, K1, SUNRISE, TOMEI, TSH

FBM KLCI - retreated from new high on heavy profit-taking

Stocks on Bursa Malaysia ended mixed yesterday with gains seen in the finance counters amid weak performances of the overseas market, following the slump at the Hong Kong and China stock markets. The FBM KLCI closed 2.17 points or 0.14% higher at 1499.11, after briefly touching 1504.19. Decliners outnumbered advancers by 497 to 328 while 283 counters were unchanged. Turnover was lower at 1.169 billion shares worth RM1.636 billion from Tuesday’s 1.374 billion shares worth RM1.874 billion.

The FBM KLCI opened 0.74 point lower at 1496.20 but surged to the intra-day high of 1504.37 within the first half an hour after market opened. Heavy profit-taking activities immediately appeared which sent the key index down to 1496.73 before late afternoon bargain hunting activities lift the key index to close off low at 1499.11, just 0.89 points below the 1,500-point key psychological resistance level. Chart-wise, the FBM KLCI formed a shooting-star candlestick, which is a bearish top reversal signal, hence, the key index is likely to correct downward further. Immediate support zone for the key index is found at 1493 to 1478, while the overhead resistance zone is at 1500 to 1505.

MACD continued to slide lower, however, its histogram continued to turned shorter upward, indicating a slow down in the bearish downward momentum, and the building up of positive momentum. RSI (14) continued to climb higher into the bullish zone and is now at 68.7. Stochastic is at 70.5, and has started to move higher, indicating the beginning of an up cycle. Signals from the indicators are signaling a bullish outlook for the FBM KLCI in the short term.

The underlying uptrend of the FBM KLCI remained intact, and as the FBM KLCI has made an attempt in testing the 1500-point level, it is expected to continue testing the level in the near term. Overnight, the Dow fell -43.18 points or -0.39% lower to close at 11,126.28. Today, the FBM KLCI is likely to trade within a range of 1487 to 1513.

This week's expected range: 1459 – 1516
Today’s expected range: 1487 – 1513

Resistance: 1504, 1508, 1513
Support: 1487, 1491, 1495

Stocks to watch: DNP, KFC, CSCSTEEL, SAPCRES, YTLLAND, KIANJOO