The FBM KLCI open with a gap up at 1252.30 yesterday, and hit the intra-day high of 1256.59. Thereafter, profit taking sets in and drove the index to an intra-day low of 1241.62, a last minute bargain hunt of blue chip stocks lifted the index higher to closed the day at 1246.86, up 0.02 point. A black spinning top candlestick was formed, indicating selling pressure was dominant and a possible top at this level. A close of the KLCI below the Fibonacci 61.8% level of 1247.48 indicates strong resistance around this level, and hence the volatile trading activities at this level as pointed out in yesterday's report. The 1250 psychological resistance level is an important level to cross above in order for the index to climb higher.
Volume was moderately higher with 1.365 billion shares traded, losers lead gainers with 415 to 332, and 245 counters were unchanged. A higher volume on a black candlestick day indicates distribution activities was heavy, forewarning further distribution ahead.
The overall uptrend is still intact with MACD continue to climb higher, and the short, medium and long term moving averages are still pointing northeast. Stochastic(14,3,3) at 88 has cross down slightly indicating profit taking has sets in, and RSI(14) at 74 is still bullish.
In conclusion, the overall uptrend is intact with possible short term correction.
Today's expected trading range: 1240 – 1255
Resistance: 1248, 1256, 1263
Support: 1221, 1231, 1238
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