Stocks on Bursa Malaysia ended lower today on profit taking amid declining crude oil prices and a weaker ringgit against the US dollar. The market also reacted to news of the delay in the Refinery and Petrochemical Integrated Development’s refinery complex, which affected Petronas Gas’ shares today. The benchmark FBM KLCI fell 13.78 points or 0.76% to 1,809.72, after hovering between 1,808.07 and 1,819.58 throughout the day. Losers outpaced gainers by 406 to 360, while 343 counters were unchanged. Total volume slipped to 2.09 billion units worth RM1.99 billion from 2.2 billion units worth RM1.78 billion on Monday.
The FBM KLCI opened 4.48 points lower at 1,819.02 but rebounded to hit the intra-day high of 1819.58 briefly after opening. The key index slipped lower on continuous selling pressure throughout the day to hit the intra-day low of 1,808.07 at late afternoon, losing 15.43 points at its worst, before rebounding on bargain hunting to close off low. Chart-wise, the FBM KLCI formed a bearish long black candlestick, a reversal pattern, which indicates heavy selling pressure, and hence, the FBM KLCI is likely to slip lower today. Downside support zone is at 1,808 to 1,795 with immediate support at 1,802, while the immediate overhead resistance zone is at 1,819 to 1,823.
MACD hooked downward and is below the signal-line, while its histogram contracted upward slightly, indicating pullback correction or consolidation. RSI (14) hooked downward to 43.5 from 49.7, indicating a pullback correction. Stochastic was slightly higher at 28.2 from 26.5 and showed sign of tapering, indicating a slowdown in the upward momentum. Readings from the indicators showed that the FBM KLCI is in correction mode, and hence, may further correct downward.
With the strong pullback yesterday, the FBM KLCI has closed below the 5 and 10-day simple moving average (SMA) after closing above them two days ago. Hence, the short term trend has again turned down and is likely to stay sideways range-bound; and the medium and long term trend continue to stay sideways range-bound. The FBM KLCI is likely to find support at the 1800-point level. However, a break of the 1800-point psychological support will see the key index sliding lower to test the pivot low support of 1,795 formed on May 13th, and a further break of the 1795-point support will see lower targets of 1,774 follow by 1,752.
Overnight, the Dow rose 13.51 points or 0.07% to close at a fresh record high of 18,312.39 for the second consecutive day. Today, the FBMKLCI is likely to trade within a range of 1,793 to 1,831.
This week's expected range: 1780 – 1833
Today’s expected range: 1793 – 1831
Resistance: 1816, 1823, 1831
Support: 1793, 1800, 1805
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