Stocks on Bursa Malaysia ended firmer yesterday supported by continued buying interest for heavyweights. The benchmark FBMKLCI gained 6.49 points or 0.36% to end at 1,828.55 after moving between 1,823.54 and 1,828.73 points throughout the day. Market breadth was positive with gainers outpacing losers by 416 to 354, while 330 counters were unchanged. Volume rose to 1.689 billion shares worth RM2.05 billion from 1.685 billion shares valued at RM1.86 billion on Monday.
The FBMKLCI opened 1.48 points higher at the intra-day low level of 1,823.54 and climbed to the intra-day high of 1,828.73 at late morning. The key index experienced heavy profit-taking and slipped lower from the intra-high day for the whole of the second session but remained in the positive territory, and a last minute buying on selected blue-chips helped push the index to close near the high of the day. Chart-wise, the FBMKLCI formed a bullish white candlestick which indicates the bulls or the buyers were dominant for the day, and hence, the FBMKLCI is likely to move higher today if the bulls continue its push. Immediate overhead resistance zone is at 1,830 to 1,838, while the immediate downside support zone is at 1,823 to 1,817.
MACD and its histogram were marginally lower after making a dead-cross the day before, indicating a further loss in the index’s momentum. RSI (14) was higher at 52.2 from 48.7, indicating a mild rebound of the key index, and the short term relative strength was back to the neutral zone with mild bullish bias. Stochastic was lower at 55.9 from 69.4, indicating further weakening of the key index and continuation of the short term down cycle. Readings from the indicators showed that the FBMKLCI is in a consolidation mode which is likely to extend until a strong breakout sign is seen.
The FBMKLCI continued to stay in its sideways range-bound mode within a range of 1,813 to 1,838 points; a breakout from the overhead resistance of 1,838 will see the key index rally towards the 1,850-point level, while a break below the 1,813-point level will see it sliding lower to test the psychological support of 1,800-point level. The long term trend, nevertheless, still remained up. With the total volume down drastically to 1.6 billion shares from above 2 billion shares last week, this further strengthens the consolidation.
Overnight, the Dow fell 67.43 points or -0.41% to close at 16,351.25. Today, the FBM KLCI is likely to trade within a range of 1,819 to 1,834.
This week's expected range: 1792 – 1863
Today’s expected range: 1819 – 1834
Resistance: 1830, 1832, 1834
Support: 1819, 1821, 1825
Stocks to watch: ANCOM, ENCORP, EXTOL, HIL, IDIMENSN, MUHIBAH, N2N, OCK, OPENSYS, SAUDEE, STEMLFE, UOADEV, XDL, YOCB
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