Malaysia: Bursa Malaysia Bhd (BMYS:KL) profoundly low during World Cup

Malaysia: Bursa Malaysia Bhd (BMYS:KL) profoundly low during World Cup

Malaysia: Bursa Malaysia Bhd (BMYS:KL) profoundly low during World Cup

The trading velocity in Malaysia during the 2018 World Cup is expected to be subdued not just because of this event but also due to the festive season.

We do not expect the World Cup event to change the fundamentals of all stocks under our coverage. Hence, we maintain our FBM KLCI year-end 2018 target of 1,800 points.

Based on observations in the year before, during and after the World Cup, the velocity in the Malaysian market is profoundly lower during the World Cup compared to the years before and after the World Cup. For example, the average velocity during the 2014 World Cup stood at 30% compared to 36% and 26% in 2013 and 2015 respectively. This was the same case for the 2010 World Cup where the average velocity during the event was at 28%, lower than 49% and 32% in 2009 and 2011 respectively.

Overall, the bias in prices is: Upwards.

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

The projected upper bound is: 8.46.

The projected lower bound is: 7.44.

The projected closing price is: 7.95.

Candlesticks

A big white candle occurred. This is generally considered bullish, as prices closed significantly higher than they opened. If the candle appears when prices are “low,” it may be the first sign of a bottom. If it occurs when prices are rebounding off of a support area (e.g., a moving average, trendline, or retracement level), the long white candle adds credibility to the support. Similarly, if the candle appears during a breakout above a resistance area, the long white candle adds credibility to the breakout.
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 13 white candles and 36 black candles for a net of 23 black 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 35.8025. This is not an overbought or oversold reading. The last signal was a sell 6 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 57.63. 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 sell 17 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 46. This is not a topping or bottoming area. The last signal was a sell 17 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 1 period(s) ago.

Rex Takasugi – TD Profile

BURSA MALAYSIA closed up 0.160 at 7.940. Volume was 13% below average (neutral) and Bollinger Bands were 1% narrower than normal.

Open High Low Close Volume___
7.780 7.940 7.780 7.940 1,281,800

Technical Outlook
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bullish

Moving Averages: 10-period 50-period 200-period
Close: 7.89 7.54 7.05
Volatility: 31 42 27
Volume: 2,618,460 1,558,294 1,408,765

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

BURSA MALAYSIA is currently 12.6% above its 200-period moving average and is in an upward 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 BMYS.KL (mildly bearish). Our trend forecasting oscillators are currently bullish on BMYS.KL and have had this outlook for the last 22 periods. The security price has set a new 14-period high while our momentum oscillator has not. This is a bearish divergence.

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