Stocks on Bursa Malaysia ended on a subdued note yesterday on lack of fresh leads as most players were away on Hari Raya holidays. The local market was dragged down by losses in heavyweights which affected market sentiment. At close, the FBM KLCI stood at 1,724.13, down 2.60 points, or 0.15%, after fluctuating between 1,720.02 and 1,735.75 throughout the day. Gainers led losers by 452 to 319 with 321 counters unchanged. Total volume rose to 1.52 billion units valued at RM1.55 billion from 841.03 million units valued at RM1.03 billion on last Thursday.
The FBM KLCI opened 6.56 points higher at 1,733.29 and surged to hit the intra-day high of 1,735.75, making a gain of 9.02 points at its best, sixteen minutes after opening. However, the upward move was hampered by heavy profit taking activity which dragged the key index lower for the rest of the day. It hit an intra-day low of 1,720.02, losing 6.71 points at its worst, before rebounding on last minute buying support to close off low. Chart-wise, the FBM KLCI formed a bearish dark-cloud-cover candlestick pattern which is a top reversal pattern that indicates heavy profit taking for the day, and hence, the FBM KLCI is likely to further correct downward or consolidate today. Immediate downside support zone is at 1,720 to 1,707, while the overhead resistance zone is at 1,727 to 1,735.
MACD was higher, but its histogram contracted downward slightly, indicating a reduction of the upward momentum or consolidation. RSI (14) slipped lower to 48.7 from 50, indicating a mild pullback correction. Stochastic was higher at 76.5 from 74.6, indicating the short term up cycle was still intact amid consolidation. Readings from the indicators showed that the FBM KLCI was undergoing a mild pullback correction, and is likely to further correct.
The technical picture of the FBM KLCI still remained very much unchanged in that the short term trend is sideways range-bound within a range of 1,685 to 1,738, while the medium and long term trend is still down. For the near term, the FBM KLCI is likely to remain in sideways range-bound mode until there appears fresh catalyst that can cause a breakout from this range, and the key index will continue to move in the direction of the breakout. An upside breakout will see the FBM KLCI moving higher to test the next higher resistance zone of 1,744 to 1,752, while a downside breakout of 1,685 would spell trouble for the FBM KLCI.
Overnight, the Dow rose 13.96 points or 0.08% to close at 18,100.41. Today, the FBMKLCI is likely to trade within a range of 1,701 to 1,751.
This week's expected range: 1692 – 1748
Today’s expected range: 1701 – 1751
Resistance: 1733, 1742, 1751
Support: 1701, 1710, 1717
Stocks to watch: APFT, BARAKAH, BENALEC, BINTAI, CENTURY, COMCORP, CYPARK, EKOWOOD, ENGTEX, FLBHD, GPHAROS, HUPSENG, IBHD, IRIS, JERASIA, JHM, KESM, KPSCB, MAGNI, MIKROMB, OPENSYS, SAMUDRA, SCABLE, SENDAI, SYF, TALIWRK, 3A, UMSNGB, WTK, YEELEE
Stock pick highlight: BINTAI (6998)
Last Price: RM0.37 +0.055
Support Level: RM0.315, RM0.27
Resistance Level: RM0.38, RM0.405, RM0.425, RM0.45, RM0.47, RM0.495, RM0.51, RM0.57, RM0.60, RM0.64, RM0.70
Entry Level: RM0.365 – RM0.375
BINTAI (6998) rebounded from its intra-day low of 0.315 to close higher at the intra-day high of 0.37. Technically, the chart of BINTAI formed a bullish white long candlestick with increasing volume indicating strong buying interest came into the stock yesterday. It breaks out from the consolidation forming a Triangle pattern breakout. MACD climbed higher after making a golden-cross over the signal-line a day earlier, and is above the zero-line, its histogram also extended upward strongly, indicating an increased in momentum to the upside and a buy signal. RSI (14) rose to 69.5 from 57.6, indicating the stock is turning bullish from mildly bullish before. Stochastic rose to 82.6 from 57.9 and is staying above the slow stochastic line, indicating the stock is getting stronger after recent correction. The medium and long term trend of BINTAI is is up, and the short term trend is also up with the 5-day SMA crossing over the 10-day SMA and both are above the 30-day SMA, and a confirmed breakout above RM0.38 will see an upside target of RM0.405, follow by RM0.425, RM0.45 RM0.47, RM0.495, RM0.51, RM0.57, RM0.60, RM0.64, and RM0.70.
Since the short term trend is bullish, day traders with shorter time frame perspective may ride on the short term bullishness and buy on breakout level (RM0.38). Those with lower risk appetite should wait at the side-line and buy on the dip.
Short Term – target price at (RM0.405, RM0.425, RM0.45 RM0.47, RM0.495), stop loss (RM0.31)
Mid Term – target price at (RM0.51, RM0.57, RM0.60, RM0.64, RM0.70), stop loss (RM0.265)
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