FTSE Bursa Malaysia KLCI (.KLSE) below 1,600 while oil, gold rally

FTSE Bursa Malaysia KLCI (.KLSE) below 1,600 while oil, gold rally

FTSE Bursa Malaysia KLCI (.KLSE) below 1,600 while oil, gold rally

The FBM KLCI pared some of its loss at the midday break today, but overall market sentiment stayed negative in line with the regional downtrend following the fresh Middle East tensions.

At 12.30pm, the FBM KLCI fell 15.19 points to 1,596.19. The index had slipped to a low of 1,593.08.

Market breadth remained negative with 444 losers and 192 gainers, while 472 counters traded unchanged. Volume was 1.91 billion shares valued at RM775.82 million.

The losers included Nestle (M) Bhd, Fraser & Neave Holdings Bhd, PPB Group Bhd, Petronas Gas Bhd, Public Bank Bhd, Carlsberg Brewery Malaysia Bhd, Chin Teck Plantations Bhd, Genting Plantations Bhd, Hong Leong Financial Group Bhd and Heineken Malaysia Bhd.

The actives included Alam Maritim Resources Bhd, Sapura Energy Bhd, Daya Materials Bhd, Hibiscus Petroleum Bhd, Velesto Energy Bhd, Bumi Armada Bhd and Icon Offshore Bhd.

The gainers included Dutch Lady Milk Industries Bhd, Malaysian Pacific Industries Bhd, LPI Capital Bhd, Petron Malaysia Refining & Marketing Bhd, Hengyuan Refining Co Bhd, Oriental Interest Bhd, SAM Engineering & Equipment (M) Bhd, Hong Leong Bank Bhd and Wah Seong Corp Bhd.

Reuters said a gauge of Asian shares was toppled from an 18-month top on Monday as heightened Middle East tensions sent investors scurrying for the safety of gold, which hit a near seven-year high while oil jumped to four-month peaks.

The United States detected a heightened state of alert by Iran’s missile forces, as President Donald Trump warned the US would strike back, “perhaps in a disproportionate manner”, if Iran attacked any American person or target, it said.

Affin Hwang Capital Research said the FBM KLCI gained 8.88 points, or 0.6%, to close at 1,611.38 on Friday (Jan 3).

It said following the strong rejection from the 1,615 immediate resistance, the index did recoup some of the losses but were unable to close above the high of the large bearish candlestick formed on Tuesday (Dec 31, 2019) with conviction.

“This tells us that the retracement is still intact. Moving forward, anticipate the index to trade within the bearish candle (1,610.69-1,588.76) in the near term.

“A convincing breach above or below the bearish candle would give investors/traders further clues regarding the next short-term direction of the index.

“Anticipate index to trade sideways with upward bias,” it said.

Technical Indicators

Overall, the bias in prices is: Sideways.

By the way, prices are vulnerable to a correction towards 1,593.65.

The projected upper bound is: 1,624.95.

The projected lower bound is: 1,571.73.

The projected closing price is: 1,598.34.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 28 white candles and 22 black candles for a net of 6 white candles.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 52.7380. This is not an overbought or oversold reading. The last signal was a sell 5 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 52.18. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 58 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 15. This is not a topping or bottoming area. The last signal was a sell 6 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 14 period(s) ago.

Rex Takasugi – TD Profile

FTSE BURSA KLCI closed down -13.620 at 1,597.760. Volume was 41% below average (neutral) and Bollinger Bands were 53% wider than normal.

Open     High      Low     Close     Volume___
1,611.1601,611.1601,593.0801,597.760 57,241,400
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 1,605.88 1,589.72 1,616.85
Volatility: 15 11 9
Volume: 78,074,184 95,709,616 108,309,856

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

FTSE BURSA KLCI is currently 1.2% below its 200-period moving average and is in an upward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect moderate flows of volume into .KLSE (mildly bullish). Our trend forecasting oscillators are currently bullish on .KLSE and have had this outlook for the last 8 periods.

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