FBM KLCI - 20150216Stocks on Bursa Malaysia closed firmer yesterday buoyed by optimism over a possible Eurozone resolution to the Greece debt and crude oil price hike. The FBM KLCI closed almost eight points higher, underpinned by fund buying of CIMB and TENAGA while plantations advanced on firmer crude palm oil (CPO) prices. At close, the FBM KLCI was up 7.94 points or 0.44% at 1,808.89, after hovering between 1,800.24 and 1,809.71 throughout the day. Advancers outnumbered decliners by 452 to 352, while 323 counters were unchanged. Total turnover expanded to 2.06 billion units valued at RM2.12 billion from the 1.96 billion units valued at RM2.33 billion transacted on Friday.


Taking cue from the advancement on Wall Street last Friday, the FBM KLCI opened 3.99 points higher at 1,804.94 but slipped lower to hit the intra-day low of 1,800.24 ten minutes after opening. The FBM KLCI rebounded from the low and climbed higher gradually for the rest of the day with bouts of intermittent mild pullback on profit-taking activity. The key index hit the intra-day high of 1,809.71 before closing slightly off high. Chart-wise, the FBM KLCI formed a bullish white candlestick which continued the uptrend from last Friday. Hence, the key index is likely to continue its upward move to climb higher today. Immediate overhead resistance zone is at 1,810 to 1,818, while the downside support zone is at 1,800 to 1,790.

MACD turned upward after sliding southward for five sessions, and its histogram also expanded upward slightly, indicating a change in momentum from down to up and the FBM KLCI is moving out from its short term consolidation. RSI (14) was higher at 60.2 from 57.6, indicating the key index is turning bullish. Stochastic, however, slipped lower to 44.6 from 47.4, indicating the short term down cycle is not over yet and the key index may continue to consolidate. Readings from the indicators showed that the FBM KLCI is gradually turning bullish but is not fully out from its short term sideways range-bound consolidation.

The short term trend of the FBM KLCI has again turned up as the key index is now closing above the all the short term moving averages while the medium term trend is sideways but with an upward bias. The longer term trend is still down as the FBM KLCI continues to stay below the cluster of long term moving averages. Nonetheless, the FBM KLCI has closed above the long term 100 and 120-day SMA, indicating an initial change in the long term trend to up. However, in order to reverse the long term trend from down to up, the FBM KLCI will have to break through the immediate overhead resistance zone posted by the cluster of long term moving averages with the uppermost resistance at 1,833 posted by the 240-day SMA. With volume returning to the two billion shares level, rotational play on small caps and ACE market counters is likely to keep the market alive.

Overnight, the US market was closed for the Presidents’ Day holiday. Over in Europe, the DAX fell 40.17 points or -0.37% to close at 10,923.23. Today, the FBMKLCI is likely to trade within a range of 1,793 to 1,819.

This week's expected range: 1743 – 1856
Today’s expected range: 1793 – 1819

Resistance: 1812, 1815, 1819
Support: 1793, 1796, 1802

Stocks to watch: ASTRO, BJCORP, BONIA, CARIMIN, CENTURY, COCOLND, EATECH, FGV, KRONO, MRCB, MPAY, MASTER, NTPM, OSK, PJDEV, PRLEXUS, SILKHLD, VITROX, XINQUAN

 

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