Due to overnight DJI plunged -213pts (-2%), the whole Asia bourses also follow. Malaysia KLSE also cannot escape from such dip. Our FBMKLCI intraday down to the lowest 1296.44 (-11.92, 0.9%) but finally closed at 1300.45 (-7.91, 0.6%). Most of the KLCI top contributors do not boost up the index. Rather, the re-bounced activities come in after 3:30pm contributed by rubber glove group, some technology counters, and active 2nd & 3rd liners that help to accelerate the re-bounce momentum and bring the market volume close to yesterday by merely down 5.4%, traded at 1.008 billion shares. There are 245 up counters and 531 down counters.
In fact, FBMKLCI intraday has fallen below the Bollinger Middle band at 1298 and further down to Fibo 23.5% level (1296) where it found the support level and re-bounced from there. As mentioned in yesterday’s technical commentary, many counters like rubber stocks and 2nd/3rd liners had been corrected for 3 to 6 days. Today happen to be T+4 and T+7 days, after so much sell off and force selling activities from morning 9:00am until 3:30pm, those rubber stocks and 2nd/3rd liners in deed re-bounce as anticipated.
Short term FBMKLCI indicators:
Bollinger band contracted -4%, it indicates KLCI30 is in consolidation;
RSI drops to 73.78 from 85.86, indicates KLCI30 is still bullish intact;
STC %K drops to 63.76 from 99.28, %D drops to 85.96 from 92.29, it indicates short term KLCI30 is slightly off bullish biased;
MACD line hook down almost crossing down, it indicates KLCI30 is still uptrend intact;
KLCI nearest resistance level is 1308.52;
KLCI critical support level ranging from 1300 and 1298 (the Bollinger mid-band) to 23.5% Fibo level (1296) as show in the chart below;
All the indicators above are mixed today but the uptrend still intact. The critical support levels MUST be observed cautiously.
In weekly technical analysis, the MACD forms a rounding bottom, this indicates KLCI30 mid-term view is bullish biased. The mid-term support level is 1278. However, we found that other indexes like FBM-Mesdaq, plantation, construction, property, industrial, trading & services, and technology are bearish biased in short-term. Finance and consumer indexes remain bullish biased.
Overall, our KLSE market prospective still up trend intact. But the short term critical support level MUST be observed cautiously. Because many of our Asia indices are just breaking down of their respective support trend lines and their respective MACD are crossing downward, that imply they are just into correction. (Major or Minor? let see next week).
