KLCI_20120209

Stocks on Bursa Malaysia closed on a steady note yesterday, driven by late buying interest in penny stocks and selected blue chips. The market extended its uptrend from Wednesday, despite the cautious trading on regional Asian markets, due to the uncertainty in the Greece debt talks. The FBM KLCI rose by 12.14 points or 0.78% to close at 1,565.32 after opening 1.97 points higher at 1,555.15, with trading mostly seen in banking and plantation stocks. Losers led gainers by 456 to 447 with 309 counters unchanged. Turnover was lower at 3.31 billion shares worth RM2.97 billion from Wednesday’s 4.39 billion shares worth RM3.3 billion. 


The FBM KLCI opened 1.97 points higher at 1,555.15 but slid lower to the intra-day low of 1,551.19 on profit-taking in the first hour of trading. The key index rebounded and moved sideways in the positive zone, and some late buying on selected blue-chips helped push the index to close at the highest point of the day. Chart wise, the FBM KLCI formed a bullish white candlestick which indicates the bulls were still in control, and the uptrend has continued. Immediate overhead resistance is at 1,567, if the FBM KLCI can cross above this immediate resistance level firmly, then, it is likely that the key index will move higher to test the next target level of 1,577.


MACD continued to climb higher, indicating a continued improvement of the market momentum. RSI (14) was higher at 73.4, indicating the short term relative strength of the key index has turned very bullish, and nevertheless, it also showed a short term overbought situation and a pull back correction is expected ahead. Stochastic continued to climb higher into the overbought zone at 97.4, indicating very bullish market strength and a continuation of the short term up cycle. Readings from the indicators showed that the FBM KLCI is in a very bullish state, however, a pull back correction is expected ahead as the indicators showed signs of overbought situation.


The underlying trend of the FBM KLCI is up and bullish as the key index is now staying above all the short, medium and long term moving averages. Immediate overhead resistance zone is at 1,567 to 1,577 while the immediate downside support zone is at 1,553 to 1,545. With volume trading above 3 billion shares, the broad market sentiment is likely to remain bullish with active rotational play on the lower liners. 


Overnight, the Dow rose +6.51 points or +0.05% to close at 12,890.46. Today, the FBM KLCI is likely to trade within a range of 1,541 to 1,580


This week's expected range: 1498 – 1562

Today’s expected range: 1541 – 1580


Resistance: 1570, 1575, 1580

Support: 1541, 1546, 1555


Stocks to watch: AZRB, MULPHA, WCT, UNISEM