Despite the strong rebound yesterday, the research house has reiterated its ‘SHORT’ positions on KLCI futures in view of the strong immediate resistance.
After hitting the 1,528-point support, the FKLI underwent a strong rebound yesterday, in an attempt to stage a counter-trend rebound. Yesterday, the index initially opened at 1,532 points. After printing the day’s low at 1,530.50 points, it climbed higher and touched the day’s high at 1,544 points before the close. Although the index is trading below the 200-day SMA line, showing a bearish setup, the bullish momentum has started to build up. In the event the index breaches the 1,550-point resistance, it will reclaim the 200-day SMA line and travel towards the higher resistance pegged at 1,578 points. On the flip side, breaching below the 1,528-pt support would invalidate the counter-trend rebound expectation, which will then be followed by a correction towards the 1,518-pt level. Since at this stage, the immediate resistance is still intact, hence the research house will stick to their bearish bias until the trailing-stop is breached.
Traders are advised to keep the short positions initiated at 1,576.50 points, or the close of 5 May. To mitigate the trading risks, the trailing-stop is revised to 1,550 points from 1,558 points. The immediate support is kept at 1,528 points (12 May’s low) with the lower support marked at 8 March’s low, i.e. 1,518 points.
Towards the upside, the immediate resistance has been revised to 1,550 pts (24 May’s high), followed by 1,578 pts, or
the high of 6 May.
