Over the last two sessions, the market exhibited an obvious intention to stay above the “non-classical Hammer”. On the second last trading day before the Chinese New Year holidays began, the FBM KLCI gapped down by 14.22 pts at the opening but successfully recouped nearly all the losses on the day itself. This rebound emerged near the bottom of the “non-classical Hammer”. In a subsequent trading session last Monday, the index experienced follow-through buying and ended higher by almost 12 pts.
It seems like the index is violating the short-term downtrend line. We have mentioned before that the “non-classical Hammer” has yet to be confirmed and a breakout from the downtrend line would be enough to confirm the bullish reversal pattern. We just need another round of strong upside momentum to be sure of the bullish signal.
The market actions over the last two trading days have significantly reduced the risk of further downward retracement. Therefore, we maintain our bullish view.
To the downside, look for immediate support at the 1,505 pt-level, followed by the 1,500-pt psychological mark. To the upside, we are still eyeing the 1,532 pt-level as the initial resistance, followed by the 1,558 to 1,567-pt downside gap.
It seems like the index is violating the short-term downtrend line. We have mentioned before that the “non-classical Hammer” has yet to be confirmed and a breakout from the downtrend line would be enough to confirm the bullish reversal pattern. We just need another round of strong upside momentum to be sure of the bullish signal.
The market actions over the last two trading days have significantly reduced the risk of further downward retracement. Therefore, we maintain our bullish view.
To the downside, look for immediate support at the 1,505 pt-level, followed by the 1,500-pt psychological mark. To the upside, we are still eyeing the 1,532 pt-level as the initial resistance, followed by the 1,558 to 1,567-pt downside gap.
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