The Malaysia stock market on Thursday ended the modest two-day winning streak in which it had picked up more than 10 points or 0.7 percent.
At 9.20am, the FBM KLCI opened at 1409.88.
RHB Retail Research in a note on Friday said following the US Federal Open Market Committee Meeting, the FKLI saw a muted response – it hovered above 1,400 pts yesterday, closing just 0.5 pts higher at 1,408 pts.
The index began at 1,408 pts and fluctuated between 1,411 pts and 1,398.50 pts before closing at the opening level. Yesterday’s sideways movement suggests that sentiment may remain muted in the coming sessions above 1,400 pts.
However, the medium term bearish outlook remains unchanged, as the 50-day SMA line has crossed below the 200-day one, indicating a “death cross”.
This is further supported by the neutral RSI strength, which is currently printing at the 40% level – this signifies negative territory and indicates a bearish momentum in the later sessions.
Based on the medium-term outlook, RHB maintains their bearish bias and advise traders to hold on to their short positions initiated at 1,414 pts, ie 10 Mar’s close.
To mitigate the trading risks, the initial stop-loss threshold is fixed at 1,445 pts.
The immediate support is set at 1,400 pts and followed by 1,382 pts, which was 17 Mar’s low. Conversely, the immediate resistance is at 1,423 pts – 1 Mar’s low – and followed by 1,445 pts or the high of 7 Mar.
