FBM KLCI’s Gains Widened Ater Opening as US Inflation Showed Sign of Cooling

The FBM KLCI opened at 1,488.05 as compared to yesterday’s close of 1,488.66.

At press time, the main index was traded in the range of 1,488.05 – 1,492.36.

At 9:09am, the gains widened to 3.50 points or 0.24% at 1,492.18.

Wall Street’s main indexes closed higher overnight as inflation rate has cooled somewhat. This inflation print has brought relief to investors as they expect smaller interest rate hikes by the Federal Reserve.

Technical Analysis on FKLI (KLCI Futures)

RHB Retail Research has been keeping long positions on FKLI.

The FKLI reclaimed back above the long-term 200-day average line yesterday as it closed 5 points higher at 1,492.50 points – it is now set to propel towards the 1,503-point immediate resistance. The index started the session neutral at 1,487.50 points and immediately climbed higher throughout, hitting the 1,494.50-point high before the close.

The positive rebound in the last two sessions post sharp profit-taking on 10 Jan suggests the FKLI is set to recoup its earlier losses towards reaching the recent high of the 1,503-point resistance in the near term. If it manages to cross above this, the medium-term uptrend movement may be observed as it forms a fresh “higher high” bullish pattern. However, if the FKLI falls back below the long-term average line, sharp profit-taking may be observed – it will then fall towards near the 50-day average line. Riding above the long-term average line, the research house is keeping to its positive trading bias.

Traders should hold on to the long positions initiated at 1,475.50 points, which was the closing level of 11 Nov 2022.

To minimise the downside risks, the stop-loss threshold is set at 1,459 points. The immediate support stays at 1,459 points – 29 Nov 2022’s low – and is followed by 1,445 points. The immediate resistance is pegged at 1,503 points, ie 1 Dec 2022’s high. This is followed by the higher resistance at 1,517.50 points or 25 Nov 2022’s high.

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