KLCI Futures: Sentiment Remains Cautious at Month End

The FBM KLCI opened lower at 1,395.29 as compared to yesterday’s closing of 1,397.50. It oscillated between 1,390.41 – 1,395.39.

At the point of writing, the KLCI fell 6.21 points or -0.39% at 1,395.29.

Technical Analysis on KLCI Futures (FKLI)

RHB Research has maintained short positions on FKLI.

The FKLI failed to stage a meaningful rebound yesterday although it climbed 2 points to close at 1,396 points. It opened at 1,399.50 points. Tracking the overnight sentiment of US peers, the index jumped to test the day’s high of 1,411.50 points, but then sellers pared down the bulk of intraday gains and led the index to its close near the day’s low of 1,394.50 points. The latest candlestick’s long upper shadow shows that sentiment remains cautious as the index approaches the month’s end.

It is expected volatility to pick up on the last trading session of September. If the index breaks past the 1,418-point resistance, this will attract strong buying interest. Otherwise, the bears will continue to drag the index lower, until it hits a strong support. At this stage, it has yet to chart a “higher high” and remains below the 50-day SMA line. As such, the bearish structure is still intact – and no change to negative bias.

Traders should maintain the short positions initiated at 1,462.50 points, or the closing level of 14 Sep. To manage the trading risks, the stop-loss is set at 1,443 points.

The immediate support is at 1,375 points, with lower support at 1,352.50 points or the low of 22 April 2020. Conversely, the
immediate resistance is now at 1,418 points – 26 September’s high – followed by 1,443 points or the high of 22 September.

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