FBM KLCI consolidates gains, slips below 1,600

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THE FTSE Bursa Malaysia Kuala Lumpur Composite Index (FBM KLCI) failed in its bid to stay decisively above its overhead support of 1,600, failing to move in tandem with the better performances on regional stock markets.
The index closed at 1,599.15 yesterday, giving a week-on-week loss of 3.92 points, or 0.24 per cent.
The FBM KLCI hit its intra-week high of 1,611.50 on Monday before rebounding to its intra-week low of 1,591.85 on Thursday, giving an intra-week trading range of 19.65 points.
The FBM KLCI’s 30 index-linked components paused to consolidate recent rebound gains when losers outperformed gainers by 16 to 9.
The following are the readings of some of the FBM KLCI’s technical indicators:
Moving Averages: The FBM KLCI continued to stay above its 10-, 20-, 30-, 50-, 100- and 200-day moving averages at the market close yesterday.
Momentum Index: Its short-term momentum index continued to stay above the support of its neutral reference line at the market close yesterday.
On Balance Volume: Its short-term OBV trend had since stayed above the support of its 10-day exponential moving averages.
Relative Strength Index: Its 14-day RSI stood at the 58.86 level.
Outlook
The FBM KLCI hit its intra-week high of 1,611.50 on Monday, moving into the confines of this column’s envisaged resistance zone (1,607 to 1,640 levels).
Subsequent technical pullbacks sent the FBM KLCI to its intra-week low of 1,591.85 on Thursday, staging a re-test of this column’s envisaged support zone (1,565 to 1,599 levels).
A quick review of the performances of the FBM KLCI’s 30 components showed that losers outpaced gainers by 16 to 9. MMCCorp, Petdag, Genting and IOICorp’s week-on-week losses of 6.14 per cent, 2.59 per cent, 1.98 per cent and 1.70 per cent respectively accounted for the bulk of the FBM KLCI’s week-on-week loss of 3.92 points, or 0.24 per cent.
YTL remained as the week’s top performing component of the FBM KLCI with a year-to-date gain of 54-sen, or 36.49 per cent.
The FBM KLCI’s weekly chart continued to stay above the support of its intermediate-term support (See FBM KLCI’s weekly chart – A1:A2) during the week. It continued to stay decisively above its intermediate-term uptrend (A3:A4).
Chartwise, the FBM KLCI’s daily price chart continued to stay above its intermediate-term downtrend (See FBM KLCI’s daily chart – B5:B6) yesterday. Also, it continued to stay above its immediate downside support (B3:B4) as well as its intermediate-term uptrend support (B1:B2).
The FBM KLCI’s daily and weekly fast MACDs (moving average convergence divergence) continued to stay above their respective slow MACDs. However, its monthly fast MACD continued to stay below the support of its monthly fast MACD.
The FBM KLCI’s 14-day RSI stayed at the 58.86 per cent level yesterday. Its 14-week and 14-month RSI stayed at 59.29 and 63.52 per cent levels at the market close yesterday.
The FBM KLCI continued to trend within range-bound trading activities as envisaged by this column when the FBM KLCI encountered resistance (1,611 level). Thereafter, the FBM KLCI staged a re-test of its immediate downside support of 1,591. It managed to breach its all-time historical resistance of 1,609.33 when it hit its new all-time high of 1,611.50 on Monday.
Next week, the FBM KLCI is likely to stage a re-challenge of its overhead resistance of 1,600. The FBM KLCI is likely to trend within narrow range-bound trading activities.
The FBM KLCI’s envisaged resistance zone is seen at the 1,603 to 1,637 levels while its immediate downside support is at the 1,560 to 1,594 levels.
The subject  expressed above is based purely on technical analysis and opinions of the writer. It is not a solicitation to buy  or sell.

Business Times : marketwatch

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