The local bourse ended the Tuesday morning session mixed, the FBM KLCI had risen 7.07 points to 1,471.90 from previous day’s close at 1,464.83 as investors were seen at bargain-hunting activities following the sharp rout in Bursa Malaysia. The performance of Bursa Malaysia in the first session was bucking the performance of the regional peers.
Hang Seng Index Futures: Negative Momentum Gaining Pace
Stop-loss triggered on HSI futures; RHB Research has initiated ‘short’ positions on this index futures.
The HSIF underwent a sharp correction yesterday, plummeting 808 points to settle the day’s session at 20,887 points. In the evening, the index dropped further, retreating 289 points to last trade at 20,598 points. The correction shows that as sentiment becomes risk-off, coupled with the index retracing below the 20-day SMA line, the bears are clearly taking the lead now. The negative price action has negated the Bullish Crossover signal of the 20-day and 50-day SMA lines. As long as the index continues to trade below the 20-day SMA line, the research house is of the view that the negative momentum will continue until it hits a meaningful support, probably at 20,500 points or the 20,000-point level. Since the index has breached the stop-loss and formed a fresh “lower low” bearish pattern, the research house is shifting to a negative bias.
WTI Crude : Bulls Strengthening At The Immediate Support
The research house is keeping its ‘long’ positions on WTI Crude futures.
Despite opening weaker, the WTI Crude ended the session on a positive note yesterday – it printed USD0.26 higher at USD120.93, bouncing off the USD119.98 immediate support. The black gold started off lower at USD120.19 and fell towards the USD117.47 intraday low before rebounding strongly northwards. Buying interest then dominated, pushing the WTI Crude towards hitting the intraday high of USD122.25 before profit-taking kicked in towards the close. Yesterday’s strong rebound from the intraday low – rebounding above the immediate support of USD119.98 – suggests the recent profit-taking may be set to resume its uptrend movement in the coming sessions. As mentioned earlier, the medium-term bullish outlook remains intact, as long the WTI Crude does not fall below the next support of USD115.56. With that, RHB Research sticks to its bullish trading stance.
COMEX Gold: Declining Below The 20-Day SMA Line
‘Long’ positions are maintained on COMEX Gold by the research house.
The COMEX Gold experienced strong profit taking on Monday, plunging USD43.70 from the previous session to settle at USD1,831.80 – below the 20-day SMA line. The commodity initially started off the session stronger, opened higher at USD1,879 and rose to the session’s high of USD1,882.50. However, selling activities dragged the commodity lower, touching the session’s low of USD1,819 before the close. The Bearish Engulfing candlestick showed that the bears currently have a technical advantage. Coupled with the RSI falling below the 50% threshold, the bullish momentum is cooling off and may see a further correction. However, the bulls will very llikely give one last fight at the USD1,830 support. For now, RHB Research is holding on to their positive bias as long as the immediate support remains intact.
