FTSE Bursa Malaysia KLCI (.KLSE) falls for 10th straight session

FTSE Bursa Malaysia KLCI (.KLSE) falls for 10th straight session

FTSE Bursa Malaysia KLCI (.KLSE) falls for 10th straight session

Bursa Malaysia closed lower for the 10th straight session today, dragged down by all index except for the FBMPalmOil index, despite bids by China’s central bank to steady its domestic markets, said an analyst.

At 5pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) fell 0.59 per cent or 9.11 points to 1,521.95 from last Friday’s close of 1,531.06.

After opening 8.92 points easier at 1,522.14, the benchmark index moved between 1,517.61 and 1,528.06 throughout the day.

On the broader market, losers thumped gainers 738 to 281, with 327 counters unchanged, 614 untraded and 21 others suspended.

Turnover increased to 3.97 billion shares valued at RM2.85 billion from 3.78 billion shares worth RM3.29 billion on Friday.

Analysts said China’s move was not enough to boost economic activity in the wake of the 2019 novel coronavirus outbreak.

“In the context of Asia, however, the big question is in the currency market and possible outflows, as well as an economic reality check.

“With China’s industrial complex on lockdown for another week, it is hard to view these events through anything other than a negative economic lens,” said Shayne Heffernan, CEO and Founder of Heffx.

He said the adverse knock-on effects would move beyond China’s border and would probably cascade globally.

It was reported that the People’s Bank of China (PBoC) said that it was lowering the seven-day reverse repo rate to 2.40% from 2.50%, and cutting the 14-day tenor to 2.55% from 2.65% previously.

The cut came as Chinese financial markets reopened after an extended Lunar New Year holiday when the death toll from the coronavirus outbreak and number of infections climbed sharply.

Main Market volume rose to 2.72 billion shares valued at RM2.57 billion from 2.59 billion shares worth RM2.98 billion on Friday.

Warrants turnover decreased to 479.95 million units worth RM80.37 million from 547.33 million units valued at RM105.07 million previously.

Volume on the ACE Market expanded to 779.84 million shares valued at RM198.80 million from 644.87 million shares worth RM196.75 million on Friday.

Consumer products and services accounted for 496.27 million shares traded on the Main Market, industrial products and services (356.97 million), construction (167.25 million), technology (246.13 million), SPAC (nil), financial services (50.57 million), property (244.38 million), plantations (84.16 million), REITs (12.52 million), closed/fund (2,000), energy (846.54 million), healthcare (80.93 million), telecommunications and media (29.63 million), transportation and logistics (72.17 million), and utilities (35.08 million).

Technical Indicators

Overall, the bias in prices is: Downwards.

Note: this chart shows extraordinary price action to the downside.

By the way, prices are vulnerable to a correction towards 1,577.09.

The projected upper bound is: 1,549.57.

The projected lower bound is: 1,491.16.

The projected closing price is: 1,520.37.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 0 white candles and 10 black candles for a net of 10 black candles. During the past 50 bars, there have been 23 white candles and 27 black candles for a net of 4 black candles.

A doji star occurred (where a doji gaps above or below the previous candle). This often signals a reversal with confirmation occurring on the next bar.

A falling window occurred (where the bottom of the previous shadow is above the top of the current shadow). This usually implies a continuation of a bearish trend. The two candles preceding the falling window were black, which makes this pattern even more bearish.

Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.

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 7.8235. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a buy 12 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 25.11. This is where it usually bottoms. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 77 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 -161.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 11 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 sell 17 period(s) ago.

Rex Takasugi – TD Profile

FTSE BURSA KLCI closed down -9.110 at 1,521.950. Volume was 57% above average (neutral) and Bollinger Bands were 65% wider than normal.

Open     High      Low     Close     Volume___
1,522.1401,528.0601,517.6101,521.950 154,060,304
Technical Outlook 
Short Term: Oversold
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 1,560.21 1,581.45 1,609.21
Volatility: 8 12 10
Volume: 146,972,896 103,999,296 109,816,824

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 gapped down today (bearish) on normal volume. Possibility of a Runaway Gap which usually signifies a continuation of the trend. Four types of price gaps exist – Common, Breakaway, Runaway, and Exhaustion. Gaps acts as support/resistance.
FTSE BURSA KLCI is currently 5.4% below its 200-period moving average and is in an downward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect moderate flows of volume out of .KLSE (mildly bearish). Our trend forecasting oscillators are currently bearish on .KLSE and have had this outlook for the last 5 periods. Our momentum oscillator is currently indicating that .KLSE is currently in an oversold condition.

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