FBM KLCI - correction

Stocks on Bursa Malaysia ended broadly lower on heavy profit-taking activities yesterday, in tandem with weakness in regional markets and losses on Wall Street overnight. The FBM KLCI fell 12.16 points or 0.9% to close at 1332.93 after twelve consecutive days of gains. Market breadth was negative with losers outpaced gainers by 476 to 239 while 292 counters were unchanged. Volume traded increased to 1.278 billion shares worth RM1.737 billion.

Chart wise, the FBM KLCI opened with a down gap of 2.68 points and traded lower for the rest of the day and closed near the day’s low to form a bearish black candlestick. A gap down near the top is not a good thing as it reflected a panic situation and the rushing out of players from the market, which also reflected through the increase in trading volume. The benchmark index is expected to get some support at the 1330 level which coincides with the 10-day moving average (MA) support.

MACD has turned south and the histogram has also turned shorter reflecting the slow down in upward momentum, nonetheless, the MACD is still in the positive or bullish territory. RSI(14) at 63.10 made a sharp turn and is back to the bullish zone form the very bullish or overbought zone. Stochastic at 88.4 has crossed below its slow Stochastic, is still above the 80 mark or the overbought zone. Signals from the indicators reflected the correction mode of the key index.
The FBM KLCI has now comes below the 5-day MA, but is still above the 10-day MA, some buying support is expected near the 1330 level which was a resistance turned support area. If this level couldn’t hold, then the index will come down to test the support zone of 1310 to 1320. The underlying short, medium and long term trend is still up.

The benchmark index may continue to correct or consolidate while the second and third may continue to be in a rotational play mode, this short term correction should be viewed as an opportunity to accumulate quality stocks at lower price level.

Today, the FBM KLCI is likely to trade within a range of 1318 to 1346

This week's expected range: 1297 – 1361
Today’s expected range: 1318 – 1346

Resistance: 1336, 1340, 1346
Support: 1318, 1325, 1329

FBM KLCI - toppish look

Stocks on Bursa Malaysia traded on a mixed note yesterday. The FBM KLCI was in the negative territory most part of the day before late buying in key heavyweights lifted it to close 0.72 point or 0.05% higher at 1345.09. The key index had touched an intra-day high of 1347.61, the highest level since March 2008. Gainers led losers by 396 to 366 while 289 counters were unchanged. Volume stood at 1.134 billion shares worth RM1.648 billion.

The FBM KLCI opened with an up gap of 1.55 point and surged to the intra-day high of 1347.61, profit-taking activities sent the key index into the negative territory and touched the intra-day low of 1341.55 before last minute buying propped up the index to close back at positive territory, and formed a black spinning top candlestick on the chart. This type of price action has been happening for the last two days which indicates distribution at this level. The appearance of two spinning top candlesticks at this level also indicated that the key index is met with strong selling activities at current level and was reluctant to move further, could signaled a short term market top.

MACD continued to surge higher, indicating a continued pickup in upward momentum. RSI(14) at 75.23 is very bullish, but has tapered off, indicating the up-move is turning slow. Stochastic at 96.97 is overbought and has hooked down, forewarning a possible correction ahead. Signals from the indicators are fore-telling of possible weakness ahead.

The key index has entered the resistance zone of 1344 to 1354, and is faced with more challenges to move higher. However, the underlying short, medium and long term trend remained up.

The benchmark index may continue to consolidate while the general market may continue to be in a rotational play, any short term correction should be viewed as an opportunity to accumulate quality stocks at lower price level.

Today, the FBM KLCI is likely to trade within a range of 1336 to 1353

This week's expected range: 1297 – 1361
Today’s expected range: 1336 – 1353

Resistance: 1348, 1351, 1353
Support: 1336, 1339, 1342

FBM KLCI - spinning top

Stocks on Bursa Malaysia closed mixed yesterday with profit-taking trimming gains on those stocks that have risen in the past few days. The FBM KLCI continued to close higher with a gain of 2.62 points or 0.2% to end the day at 1344.37. Most of the index’s gains came from TENAGA which rose RM0.28 or 3.5%. Gainers led losers by 406 to 369 while 288 counters were unchanged. Volume traded is higher at 1.122 billion shares worth RM1.545 billion.

The FBM KLCI was very much in the profit-taking mode yesterday. It rose as much as 4.5 points in the morning session hitting the high of 1346.23, but profit-taking push the index to slide lower for most part of the day before last minute buying lifted it to close higher. The price action of the benchmark index formed a Spinning Top candlestick which indicates a possible pause to the current uptrend which has run for 11 trading days consecutively.

MACD continued to move higher. RSI(14) is higher at 74.9, is very bullish. Stochastic is also higher at 97.6, but is tapering off. The oscillators are indicating a short term overbought conditions, and the index may take a breather.

The index has entered the resistance zone of 1344 to 1354, and may try to challenge the 1350 psychological level. The underlying short, medium and long term trend of the benchmark index is up.

The general market may continue to be in a rotational play while the index may consolidate, any short term correction should be viewed as an opportunity to accumulate quality stocks at lower price level.

Today, the FBM KLCI is likely to trade within a range of 1335 to 1352.

This week's expected range: 1297 – 1361
Today’s expected range: 1335 – 1352

Resistance: 1347, 1349, 1352
Support: 1335, 1338, 1341

FBM KLCI - 10th consecutive higher close

Stocks on Bursa Malaysia ended broadly higher yesterday in tandem with the rise in regional markets, aided by the better than expected US job data released last Friday, which helped to boost investors’ interest along with hopes of a sustained economic recovery. The FBM KLCI rose 5.81 points or 0.43% to close at 1341.75 after opening 3.36 points higher at 1,339.30. Gainers led losers by 403 to 322 while 289 counters were unchanged. Volume traded was higher at 1.052 billion shares worth RM1.308 billion.

The FBM KLCI rose for ten consecutive trading days with cumulative gains of over 48 points to close at the highest level in two-years. It formed a white candlestick with a small body yesterday, which indicates low volatility and consolidation. In fact, the benchmark index was trading in a narrow range of only 2.9 points throughout the day, indicating the bulls were cautious in their trades. The index may face more selling pressures at it moves into the resistance zone of 1344 to 1354.

MACD continued to move higher indicating a continuation in upward momentum. RSI(14) at 74 is very bullish and has entered the short term overbought zone. The Stochastic at 96.7 is very strong and also in the short term overbought zone.

The underlying short, medium and long term trends are all up, indicating a very bullish state of the benchmark index. However, after a continuous rise for ten consecutive trading days, the market may find an excuse to correct itself. Any short term correction should be viewed as an opportunity to accumulate quality stocks at lower price level.

Today, the FBM KLCI is likely to trade within a range of 1337 to 1345.

This week's expected range: 1297 – 1361
Today’s expected range: 1337 – 1345

Resistance: 1343, 1344, 1345
Support: 1337, 1338, 1340

Stock to Watch: WASEONG, PETRA

FBM KLCI - expected to move higher

Stocks on Bursa Malaysia continued to rise last week after the announcement of the New Economic Model by the Prime Minister. The announcement have moved the market mildly as it only provided the main frame of the model, while the details of its implementation will only be revealed at stage two.

The FBM KLCI gained 20.8 points or 1.58% week-on-week to close last week at 1335.94. Turnover for the week dropped to 4.782 billion shares worth RM6.899 billion from previous week's 5.214 billion shares worth RM7.983 billion.

On the weekly chart, the FBM KLCI formed a bullish white candlestick which opened near its weekly low on last Monday at 1313.98 and closed near its weekly high at 1335.94, a two-year highest close. The benchmark index hit an intra-week high of 1337.21 on last Friday. This indicated the Bull is very much in control, and the index is expected to move higher this week to challenge the 1350 level. It is expected to face strong resistance at the 1344 to 1354 zone.

Weekly MACD continued to move higher, albeit still below its slow MACD, indicating a continued pickup in upward momentum. Weekly RSI(14) at 70.43 has entered the very bullish zone, hence, the index is expected to further move higher. Weekly Stochastic at 82.51 has turned up, and entered the overbought or very bullish zone. Some profit-taking or small correction to the index is expected as it comes to this level, there is however, no sign of weakness yet.

The underlying short term trend continued to stay up with the FBM KLCI continued to stay above the 5-week moving averages; the medium term trend as indicated by the 10-week MA has turned up, is sideways to up, while the long term trend as indicated by the 30-week MA remained up.

This week, the FBM KLCI is expected to move higher on leads from the overseas market with intermittent profit taking. Selected GLC may continue to move higher with rotational play on lower liner stocks.

The FBM KLCI may trade within a range of 1297 to 1361 this week, and for today it is likely to trade within a range of 1323 to 1345.

This week's expected range: 1297 – 1361
Today’s expected range: 1323 – 1345

Resistance: 1339, 1342, 1345
Support: 1323, 1326, 1331

Stock to watch: WTK

FBM KLCI - 2 years high

Stocks on Bursa Malaysia ended higher yesterday with buying focus mainly on key heavyweights, while lower liners were more of in a consolidation mode. The FBM KLCI moved in tandem with regional bellwether indices to close 9.27 points or 0.79% higher at 1329.84, the highest close in two-years. Gainers led losers by 423 to 316 while 295 counters were unchanged. Turnover was lower at 807 million shares worth RM1.349 billion.

The FBM KLCI breakout from its recent short consolidation to move higher, it hit intra-day high of 1332.58 before pulling back on profit-taking to close at 1329.84, the highest close in two years, surpassing the 1328 level charted on March 10. The benchmark index formed a bullish white candlestick with short upper shadow, which indicates strong buying support on bullish move. It may continue to move higher to re-challenge the 1334.34 level, the highest high in two years charted on March 11. If the index is able to break above this level successfully, it may move higher to challenge the 1350 level in weeks to come.

MACD continued to move higher on a stronger pace indicating a pickup in upward momentum. RSI(14) at 69.4 pickup strongly and is approaching the very bullish zone. Stochastic continued to move higher above the 80 level, is very bullish and the short term up cycle remained intact.

The underlying short, medium and long term trend as indicated by the moving averages remained up.

Today, the FBM KLCI is likely to trade within a range of 1314 to 1345.

This week's expected range: 1277 – 1339
Today’s expected range: 1314 – 1345

Resistance: 1335, 1340, 1345
Support: 1314, 1320, 1325

Stock to Watch: UEMLAND

FBM KLCI - consolidation

Stocks on Bursa Malaysia ended firmer yesterday as the market continued to profit-take during the day. The FBM KLCI traded in a narrow range and bounced between the positive and negative territories through the day before closing 1.22 points or 0.09% higher at 1320.57. Market breadth was negative with losers outpaced gainers by 441 to 275 while 274 counters were unchanged. Volume fell to 961.37 million shares worth RM1.54 billion from 1.046 billion shares worth RM1.33 billion on Tuesday.

Chart wise, the FBM KLCI formed a small body candlestick with lower shadow which indicates consolidation. The benchmark index is support below by the 5-day moving average at 1317, albeit it had penetrated the MA on intra-day. If this level can’t hold, then it might further correct downward to the 1308 level.

MACD continued to move higher but on a slow pace indicating weak upward momentum. RSI(14) at 64.9 is almost flat. Stochastic continued to climb higher indicating the short term up cycle is still intact.

The underlying short, medium and long term trend as indicated by the moving averages remained up. However, signals from the various indicators indicated that the index might continue to consolidate or correct downward, while rotational play on lower liners and selected GLCs may prevail.

Today, the FBM KLCI is likely to trade within a range of 1313 to 1326.

This week's expected range: 1277 – 1339
Today’s expected range: 1313 – 1326

Resistance: 1322, 1324, 1326
Support: 1313, 1315, 1318

Stock to watch: MPHB