The FBM KLCI Index rose again yesterday, boosted by Bank Negara Malaysia’s declaration that Malaysian banks are safe from systemic weakness. The benchmark index rose 11.26 points, or 0.80%, to end the day at 1,420.35, led by advances in PPBGROUP, AMBANK, TM and SIME in tandem with stronger sentiment across the regional markets.
Malaysian Investment Bank (MIBB) in a recent report said market breadth turned positive for the first time this week with gainers outnumbering losers by 574 to 331. A total of 3.42 billion shares valued at RM1.74 billion changed hands.
The consolidation since 14 Mar 2023 has ended as the benchmark index formed a new higher high structure in tandem with positive reading in both the Stochastic and moving average convergence divergence while both the mid and small-cap index started to play catch up.
“Technically, we expect the FBM KLCI Index to range between 1,410 points and 1,450 points today, with support remaining at 1,380 points and 1,350 points,” said MIBB.
TRADING IDEAS:
ANN JOO RESOURCES – 6556 (RM1.22)
Strategy: accumulate
The major downtrend line was taken out yesterday – on the back of unusually high trading volume. The stock also surged past the upper Bollinger band along with a bullish reading in both the Stochastic and moving average convergence divergence– indicating the overall bias has shifted upward. MIBB expect the new upcycle to continue to unfold in the near term.
2. BOUSTEAD PLANTATION – 5254 (RM0.710)
Strategy: accumulate
“Following our buy on 17 Jan 2023, the stock gained 15.1% to peak at MYR0.765, slightly below our second target of RM0.775. The subsequent correction however has ended following a reversal move within the 61.8% FR level and the “Ichimoku Cloud.” Yesterday’s sharp gain is set to kick-start a new upcycle as we reiterate our buy with a higher target,” said MIBB.
3. DIALOG GROUP – 7277 (RM2.34)
Strategy: accumulate
The recent decline within the downtrend channel has finally come to an end following yesterday’s breakout above the downtrend line. The stock also rose past the 20-day simple moving average line thus turning the short-term bias positive. “Backed by bullish reading in both the Stochastic and moving average convergence divergence, we expect the stock to trade higher in the near term,” said MIBB.
