Thursday, March 17, 2011

KLCI Is Building Base Well Above The Lower Bollinger Band.

KLCI Recap: KLCI down -0.4 point from as much as -12 points intraday.
After falling as much 12 points intraday, the FBM KLCI pared earlier losses to close -0.4 point at 1492.1 following news report that workers are trying to restart cooling system and prevent a meltdown at the Fukushima nuclear power plant.

Sentiment was further aided by G7 officials meeting today to discuss the threat from the devastating earthquake in Japan. The meeting raised the prospect of a coordinated action to prevent the disaster from crippling the world’s third-largest
economy.

KLCI Outlook: Building its base well above lower Bollinger band
As the situation at Japan’s nuclear power plant remains highly uncertain and the flow of information scattered and inconsistent, investors are likely to stay cautious in the aftermath of Japan's devastating earthquake and tsunami. Moreover, expectations of resumed rally in oil prices after UN agreed on military force against Libya is likely to dampen short term trading confidence.

We reiterate our view that the twin bottoms of 1474 points recorded on 28 Feb 11 and 29 Nov 10 are critical support levels which must not be violated. A breakdown could trigger more sell-off towards 1450 (38.2% FR from low of 1243 and peak of 1577), followed by the major 200-d SMA of 1445 points.

Meanwhile, resistance levels are situated around 1500, 1505 (mid Bollinger band) and 1510 (30-d SMA).

KLCI Is Building Base Well Above The Lower Bollinger Band.
FBM KLCI 18-03-2011



Source: HLeBroking

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