Stocks on Bursa Malaysia closed broadly lower yesterday with losses led by key index-linked counters, such as PCHEM and CIMB, as investors remained jittery on the outlook. The FBM KLCI dropped 11.82 points, or 0.79%, to 1,472.16, after opening 6.65 points lower at 1,477.33. Losers outstripped gainers by 580 to 207 with 253 counters unchanged. A total of 853.772 million shares worth RM1.672 billion were traded, down from 958.9 million shares valued at RM2.19 billion traded last Friday.
The FBM KLCI opened with a down gap of 6.65 points at 1,477.33 and slipped lower with mild rebound that touched the intra-day high of 1,478.91. The key index succumbed to continued selling pressure and hit the intra-day low of 1,467.42 before rebounding to close off low at 1,472.16 on mild bargain-hunting activity. Chart-wise, the FBM KLCI formed a bearish black candlestick which indicates sellers continued to dominate the market, as the key index continued to close below the mid point of the day. The FBM KLCI is now closing just below the critical support of 1,474-point, and a continue close below this level will likely see the key index sliding lower towards the next lower support level of 1,464-point, the 23.6% Fibonacci retracement level measuring from the pivot high of 1,597 to the pivot low of 1,423.
MACD continued to slide lower, indicating an increase in the bearish downward momentum. RSI (14) is at 29, and has again slipped lower into the very bearish zone and is short term oversold. Stochastic is at 47.2 and has crossed below its slow stochastic line, marking an end of the rebound rally, and the beginning of another down cycle. Readings from the indicators showed that the FBM KLCI continued to remain bearish, and the consolidation may extend until there are signs of bottoming out.
The FBM KLCI continued to remain in a bearish downtrend with no sign of bottom yet. Its trend will continue to be influenced by the development of external factors and will move in tandem with regional markets. Immediate downside support levels lies at 1,464, 1,457 and 1,450. If these levels could not hold, then the FBM KLCI is likely to re-visit its recent low of 1,423.
Overnight, the Dow rose +37.00 points or +0.34% to close at 10,854.65. Today, the FBM KLCI is likely to trade within a range of 1,455 to 1,490.
This week's expected range: 1438 – 1524
Today’s expected range: 1455 – 1490
Resistance: 1479, 1485, 1490
Support: 1455, 1461, 1466