FTSE Bursa Malaysia KLCI (.KLSE), global equities jump on expectation of policy stimulus for economy
The FBM KLCI opened on a sharp rebound as it sought to retrace the losses of the previous session amid postive vibes over anticipated policy stimulus among the world’s key central banks.
At 9.05am, the index was up 13.75 points to 1,480.68, just two points shy of erasing yesterday’s decline. Trading volume was 252.17 million shares valued at RM126.9mil.
Of top actives, SAPURA ENERGY rose one sen to 17 sen, Bumi Armada added 0.5 sen to 31.5 sen and Avillion was unchanged at 16 sen.
Overnight the European Central Bank echoed calls by the US Federal Reserve that it would take measures to mitigate the impact of the Covid-19 outbreak on the economy.
At Asia’s open on Tuesday, global equities were seen rising on the news along with crude oil prices as traders looked forward to a better demand outlook.
Regional markets were seen extending their recovery with Japan’s Nikkei rising 0.9% and South Korea’s Kospi jumping 2.2%. Australia’s ASX200 climbed 1.9% ahead of an expected emergency rate cut by its central bank later today.
Among individual stocks on Bursa Malaysia, brewers finally snapped their losing streak with Heineken jumping 98 sen to RM23.98 and Carlsberg adding 72 sen to RM29.60.
Top Glove was also seeing positive price action on news that it had settled its legal suit with the vendors of Aspion Sdn Bhd. The glove maker climbed 18 sen to RM5.78.
Stocks helping to lift the FBM KLCI included Public Bank adding 32 sen to RM17,40, petronas Gas climbing 30 sen to RM16.80 and Hong Leong Bank rising 26 sen to RM15.28.
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 1,546.26.
The projected upper bound is: 1,511.28.
The projected lower bound is: 1,441.30.
The projected closing price is: 1,476.29.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 22 white candles and 28 black candles for a net of 6 black candles.
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.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 29.9186. This is not an overbought or oversold reading. The last signal was a buy 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 32.50. This is not a topping or bottoming area. However, the RSI just crossed above 30 from a bottoming formation. This is a bullish sign. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 0 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 -101.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 3 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 6 period(s) ago.
Rex Takasugi – TD Profile
FTSE BURSA KLCI closed up 11.700 at 1,478.640. Volume was 56% above average (neutral) and Bollinger Bands were 72% wider than normal.
Open High Low Close Volume___
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 1,502.03 1,559.55 1,597.92
Volatility: 20 14 11
Volume: 181,924,608 126,625,800 114,296,680
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.
FTSE BURSA KLCI is currently 7.5% below its 200-period moving average and is in an downward 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 volume flowing into and out of .KLSE at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on .KLSE and have had this outlook for the last 26 periods.