The Malaysia stock market on Friday halted the three-day winning streak in which it had jumped almost 30 points or 2 percent. The Kuala Lumpur Composite Index now rests just beneath the 1,425-point plateau although it’s predicted to rebound on Monday.
At 9.25am, the FBM KLCI opened at 1431.57.
RHB Retail Research said today (April 3) that the sentiment on the FKLI turned cautious after it declined 2 pts last Friday to close lower at 1,423 pts.
The index started off at 1,425.50 pts and initially it rose towards the intraday high of 1,431 pts, but gave up the bulk of intraday gains and fell to the day’s low of 1,422 pts before the close. The latest candlestick with the “long upper shadow” shows strong profit taking activities took place.
The index may resort to a sideways movement in the coming sessions before resuming upwards to test the 1,445-pt immediate resistance. Observe that the RSI is trending higher, suggesting the momentum is turning positive.
At this stage, we expect a strong resistance will emerge at the 1,445-pt level. As long as the index stays below this threshold, we hold on to our negative bias.
Traders are recommended to retain the short positions initiated at 1,414 pts, or the close of 10 Mar. To manage the trading risks, the initial stop-loss is placed at 1,445 pts.
The immediate support is marked at 1,400 pts, followed by 1,382 pts, or the low of 17 Mar. Meanwhile, the immediate resistance is pegged at 1,445 pts – 7 Mar’s high – followed by 1,476 pts ie the close of 17 Feb.
