Weekly MACD continued to slide lower, indicating the slow down in the medium term upward momentum. It is however, still positive. Daily MACD continued to slide lower, but at a slower pace, as shown by the shorter histogram, indicating a slow down in the short term downward momentum.
Weekly RSI (14) is at 76.3 and has hooked up, reflecting the rebound on the weekly chart, and is still staying firm in the very bullish zone. Daily RSI (14) has rebounded strongly from 49.4 on last Thursday to 55.5 on Friday, moving back to the neutral to mildly bullish zone.
Weekly Stochastic is at 88.8 and has crossed below its slow stochastic line, reflecting the correction, it is however, still strong until it crossed below the 80 mark. Daily Stochastic is at 32.8 and has turned upward after hitting the low at 28.9 on last Thursday, it is however, still below its slow stochastic line, and the correction would be considered over when the stochastic crossed above its slow stochastic line.
Readings from the indicators and candlestick show that the correction on the FBM KLCI is nearing over, but still require one or two more days’ data for confirmation.
On the trend side, the FBM KLCI is currently holding above the 30-day moving average and is also above the psychological support level of 1500. As it is still below the 10-day MA, the short term trend is still considered sideways. However, the medium to longer term uptrend still remained intact. Immediate overhead resistance zone of the FBM KLCI is at 1510 to 1532 while its immediate support zone lies at 1500 to 1487.
For the coming week, the FBM KLCI is expected to trade higher following positive indicators that Asian equities have stabilized as fears of China hiking interest rates fizzle out, and the European debt crisis was also effectively being contained by the European policymakers.