KLCI Futures in Consolidation Stage

According to RHB Research’s technical analysis on KLCI futures (FKLI), the bullish structure remains intact for now. Hence, the research house has maintained “long” positions on FKLI.

The FKLI pulled back sharply on profit-taking after hitting the wall of the Bearish Breakaway Gap yesterday, retracing 15.50 points from the previous session to settle at 1,462 points. The index began the session at 1,477.50 points and initially rose towards the 1,479-point session high. However, the gap resistance was stiff and selling pressure dragged the FKLI towards the 1,458-point session low before the close. The latest negative price action saw the index fail to break past the gap resistance and 50-day SMA line. As such, it may resort to consolidations, and retreat towards the 1,448-point and 1,436-point supports. If the momentum picks up again, the FKLI may re-test the 1,480-point immediate resistance. Meanwhile, as long as it continues to trade above the 1,436-point support, the bullish structure will be deemed valid. For now, no change to bullish bias until the stop-loss mark is breached.

Traders should hold on to the long positions initiated at 1,450.50 points or the closing level of 21 July. To mitigate the trading risks, the stop-loss threshold is placed at 1,436 points.

The immediate support sticks at 1,448 points – 22 July’s low – and is followed by 1,436 points, ie the low of 4 July. The immediate resistance stays at 1,480 points – 13 June’s high – and then 1,488 points, which was the low of 10 June.

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