Despite coming under mild selling pressure, the FKLI managed to stay above the 1,600-point level and closed unchanged at 1,602.50 points, RHB Research said.
Initially, the index opened lower at 1,599 points and dropped to the day’s low of 1,594.50 points. It staged a rebound and tested the day’s high of 1,607.50 points before closing. The latest price action indicates that the low of the candlestick is above the low of the previous session, ie a “higher low”, which points to the fact that the bulls are still in the driver’s seat.
Amidst the renewed momentum, the index should move higher to retest the immediate resistance of 1,608.50 points. In the event the momentum loses steam, we expect the 1,586.50-point level to be the immediate support.
With the bullish setup intact, RHB Research said that it makes no change to its positive trading bias. It recommends that traders remain in the long positions initiated at 1,567.50 points, or the close of 16 March.
To mitigate the trading risks, the stop-loss is set at 1575.50 points. The immediate support is now at 1,586.50 points (6 Apr’s low), followed by 1,575.50 points or the low of 29 Mar. The nearest resistance is pegged at 1,608.50 pts (25 Mar’s high), followed by 1,620 points, the YTD high printed on 16 Feb.