Profit taking! Profit taking! Yes, DJI downed -109 points and it is a good reason for the investors to lock some profit after the stocks had run for so many days. As I mentioned yesterday many stocks including the heavy weighted CI components are due for T+3,T+4 for today and tomorrow, there will be a profit taking. However taking a close look at the market, the high flyers continue to fly higher. The consumer sector continues to run and everyday have new stars appeared. The market not really bearish yet, profit taking is a healthy correction. FBMKLCI dropped -4.97 points and closed at 1336.05 (-0.37%). It manages to close above the Bollinger10 mid-band and the previous peak 1335.
The overall market’s trend is considered as mixed today as there were 318 up counters and 388 down counters with the market total traded volume flat at 872 MIL shares. The trading volume is above 40 days VMA and it is sufficient to keep the market “HOT”. We expect rotational play and profit taking will continue tomorrow.
Today’s FBMKLCI top 5 gaining components are DIGI, BJTOTO, HLFG, UMW and IOICORP. The top 5 lagging components are GENM, SIME, RHBCAP, MAS and KLK.
FBMKLCI Technical Indicators
FBMKLCI stays above the Bollinger Middle Band 10 (BMB10). The Bollinger Band 10 (BB10) contracted -22% due to correction; FBMKLCI is considered as consolidation.
RSI moves sideway to 67.87 (flat); this indicates FBMKLCI is consolidation.
STC %K decreases to 69.36% and the %D decreases slightly to 82.37, this indicates FBMKLCI is consolidation but not turn bearish yet.
The MACD hooked down slightly and the histogram had started a rounding top, this indicates FBMKLCI is bearish biased.
Summary
Most the indicators indicate FBMKLCI is moving sideway with bearish biased. We foresee profit taking and rotational play will continue tomorrow. The sectors that haven’t run are Plantation, Mesdaq and Technology. You may want to get ready for these sectors. As CPO price had started to move up to above RM2500 per ton, plantation sector may be the next theme. The nearest possible resistance levels for FBMKLCI is 1341 and 1350 whereas the nearest possible supports levels is BMB (10) and 1325 (FR 76.4%). Please refer to the picture below.
