Monday, October 17, 2011

FBM KLCI: Wild Swings Ahead

Bursa Recap: KLCI up 23 points to 1465.4, tracking strong regional peers
Tracking strong regional bourses following a 4% weekly jump on Dow and rising hopes for a resolution to the European debt crisis, the KLCI soared 22.9 points to 1465.4.

Leading movers were SIME (+35 sen to RM8.90), TENAGA (+37 sen to RM5.57), PETCHEM (+22 sen to RM6.14), GENTING (+22 sen to RM10.12) and IOICORP (+11 sen to RM5.14).
Trading volume ballooned 66% to 1.78bn shares worth RM1.75bn, the highest since 9 August.

FBM KLCI Outlook: Wild swings ahead
As cautioned earlier, the rebound in global equities from recent lows are riding on a wave of euphoria built on optimism that European leaders had a newfound commitment and quick solution to tackle a crisis that threatened financial stability and global growth.

However, with the overnight plunge on Dow and the negative remark by German’s Finance Minister that there will not be a prompt solution to the euro-zone debt crisis, global markets are again susceptible to swift declines.

Hence, we continue to advocate risk-averse investors to sell into strength or trim positions on overbought Stochastic indicator and looming election risk. Weekly resistances are 1470 (15-w SMA) and 1489 (38.2% FR) while supports are 1440 (uptrend line), 1422 (61.8% FR) and 1412 (10-d SMA).

Daily KLCI: Uptrend Intact But Stochastic Overbought
FBM KLCI 18-10-2011

Weekly KLCI: Medium Term Uptrend Intact Amid Strong Breakout And Improving Technicals
FBM KLCI 18-10-2011a

Source: HLIB Research

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