FBM KLCI - breakout from consolidation
Stocks
on Bursa Malaysia closed higher yesterday, supported by gains in
finance counters as well as selected oil and gas-related counters.
Maybank was among the top gainers rising 19 sen, or 2.21%, to RM8.79, as
news over its merger and acquisition of RHB resurfaced. At close, the
benchmark FBM KLCI stood at 1,753.31, up 9.74 points, or 0.56%, after
hovering between 1,745.5 and 1,755.12 throughout the day. Gainers
outpaced losers by 507 to 302 with 303 counters unchanged. Total volume
rose to 1.9 billion shares worth RM1.9 billion from to 1.8 billion
shares worth RM1.9 billion on Friday.Taking cue from the strong rebound on Wall Street last Friday, the FBM KLCI opened 1.93 points higher at 1,745.50, the intra-day low level, and climbed higher throughout the day with intermittent mild pullback on profit-taking. The key index hit an intra-day high of 1,755.12 just before closing. Chart-wise, the FBM KLCI formed a bullish white candlestick which indicates the bulls or buyers were in control for the day in pushing the index higher. Hence, the FBM KLCI is likely to continue its upward momentum to climb higher today. Immediate overhead resistance zone is at 1,755, follows by 1,759, 1,768 and 1,770, while the immediate downside support zone is at 1,745 to 1,732.
MACD continued to climb higher albeit still below the zero-line, and its histogram extended northward, indicating an increased in momentum to the upside. RSI (14) hooked upward to 52.5 from 48.9, indicating the short term relative strength of the FBM KLCI has turned mildly bullish from a mildly bearish state. Stochastic swung upward to 63.9 from 58, indicating the key index has resumed its up cycle after a mild pullback correction. Readings from the indicators showed that the momentum of the FBM KLCI has turned upward after a short period of consolidation, and hence, is likely to continue moving higher.
The medium and long term trend of the FBMKLCI still remained down as the key index continued to stay below the medium and long term moving averages. However, with the bullish upward move yesterday, the FBM KLCI has resumed its short term uptrend after a three days consolidation. Thus, the FBM KLCI is likely to climb higher today to challenge its overhead resistances with immediate resistance at 1,755, follows by the medium term resistance zone posted by the 50 and 60-day simple moving average at 1,766 and 1,778. On the broader market, sentiment has turned mildly bullish which saw 507 gainers against 302 losers, and rotational play on small caps and ACE market counters is likely to continue.
Overnight, U.S market was closed for Martin Luther King Jr. Day holiday, and over in Europe, the Dax rose 74.58 points or 0.73% to close at a fresh record high of 10,242.35. Today, the FBMKLCI is likely to trade within a range of 1,737 to 1,764.
This week's expected range: 1692 – 1783
Today’s expected range: 1737 – 1764
Resistance: 1757, 1760, 1764
Support: 1737, 1741 1747
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GUOCO, HOHUP, ICON, IQGROUP, KNM, LONBISC, MMODE, ORNA, PESONA, SKPETRO,
SCH, SUNZEN, TGOFFS, TMCLIFE, UMWOG, WELLCAL, WONG
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