The FKLI edged higher by 1 point last Friday to close at 1,421.50 points. The index initially began the session at 1,420.50 points. After trading between 1,426.50 points and 1,414.50 points, it closed relatively unchanged at 1,421.50 points, RHB Research said.
It said that the muted session suggests the bears taking a breather now. In the event the bulls lift the index higher, they may face immediate resistance at the 1,437-point level, and then be tested by the strong resistance of the 1,450- point level.
If the bullish momentum fails to break past the immediate resistance, selling pressure will then drag it down towards 1,400 points, followed by the 1,388-point support.
For now, RHB said that the index has yet to chart a fresh “higher high”, as such, it is evident that the bears are still in control despite selling pressure moderating.
With the bulls remaining weak, we keep to our negative bias. Traders are recommended to keep to the short positions initiated at 1,524.50 points.
To minimise the trading risks, the trailing stop is set at 1,450 points. The immediate support stays at 1,400 points, followed by 1,388 points. On the other hand, the first resistance is adjusted to 1,437 points, with the higher resistance pegged at 1,450 points.
