With the index losing about 47 pts on the 9th, 10th and 11th of Feb, last Friday’s 9-pt gain may seem encouraging, but it could just be a technical rebound from the nearly 50 pts of losses recorded previously. Even though the FBM KLCI has now returned back above the previous recent low of 1,505 pt-level in a convincing manner, we still cannot tell if the index has bottomed out.
Last week, we drew a potential downtrend channel which we hope could help us in reading the nearterm market direction. Having created a lower high last week, there is a possibility that the index may start creating a downtrend channel and eventually retrace to the next key low of 1,474 pts. Last Friday’s rebound emerged within our potential downtrend channel and did not clearly signal the end of the retracement starting at the historic high. Also, do not forget that the index has violated the strong uptrend line.
We stick to our Neutral view towards the near-term market for now. The retracement that started since the beginning of the year from the historic high has not harmed the market’s mid-term uptrend. Hence, the mid-term technical outlook of the FBM KLCI remains firmly bullish.
From the current level, there is still an immediate support at the 1,505 pt-level, followed by the 1,500 pt-psychological level. To the upside, we continue to look for initial resistance at the 1,524-1,536-pt area.
Last week, we drew a potential downtrend channel which we hope could help us in reading the nearterm market direction. Having created a lower high last week, there is a possibility that the index may start creating a downtrend channel and eventually retrace to the next key low of 1,474 pts. Last Friday’s rebound emerged within our potential downtrend channel and did not clearly signal the end of the retracement starting at the historic high. Also, do not forget that the index has violated the strong uptrend line.
We stick to our Neutral view towards the near-term market for now. The retracement that started since the beginning of the year from the historic high has not harmed the market’s mid-term uptrend. Hence, the mid-term technical outlook of the FBM KLCI remains firmly bullish.
From the current level, there is still an immediate support at the 1,505 pt-level, followed by the 1,500 pt-psychological level. To the upside, we continue to look for initial resistance at the 1,524-1,536-pt area.
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