Wednesday, 19 September 2012

FBM KLCI - Consolidating Last Week’s Strong Gains


Consolidating Last Week’s Strong Gains
In our previous analysis, we mentioned that last Thursday’s “Long White Day” has more or less confirmed the non-classical “Hammer”. Finally,  another  round  of  rally  which  occurred  last  Friday  completely  erased  the  bearish  sentiment  seen  two weeks ago.

The bulls can now once again look to the 1,655 historic high as the next upside resistance. Nonetheless, since the FBM KLCI has already gone up by about 40 pts over the last four trading days, there is a possibility that the  index will start taking  a breather, as the consolidation of last week’s gains may have already taken place yesterday. 

The  near-term  technical  outlook  of  the  FBM  KLCI  remains  firmly  bullish.  Its  daily  RSI  is  now  trading  at  around  the  50-pt
neutral zone, offering  scope for  additional gains  in the near future. In addition, the  index has been rebounding on steady rising volume, which is a healthy sign for the current upward momentum.

The  1,655-pt  historic  high  is  the  remaining  resistance  to  be  challenged.  To  the  downside,  look  for  an  immediate  strong
support at the 1,628-1,643 pts area. Additional supports can be found at the midpoint of last Thursday’s “Long White Day” at 1,620-pt level, followed by the opening of the candlestick pattern at 1,612-pt level.
Source: OSK

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