Thursday, October 13, 2011

KLCI To Stay Vigilant

Bursa Recap KLCI rises 16.4 points to 1444.9 for a 3rd straight gains
Regional bourses ended generally higher on growing hopes that Europe is taking concrete steps to contain the region's debt woes and head off a systemic banking crisis. However, sentiment was cautious as China’s exports rose the least in seven months and the customs bureau warned of “severe” challenges as the global economic outlook dims, giving Premier Wen Jiabao’s government less incentive to let the Yuan rise.

The FBM KLCI extended its gains (+16.4 points to 1444.9) for the 3rd straight day, supported by local institutional and retail investors, reflected by 40% jump in volume and 51% surge in value to 1.51bn shares worth RM1.96bn, respectively.

FBM KLCI Outlook: Stay vigilant
During recent rebound, we noted that key global markets jumped 5-19% from a 2-month low and mostly surpassed the 30-d SMA (except China and Thailand). With this breakout, these equity markets could continue to rise to retest the 50-d SMA although we do expect bouts of profit taking consolidations along the way.

After violating the 1411 (downtrend line resistance from 1511) to close at 1444.9 yesterday (at the second downtrend line), a more formidable resistance is at 1447 (50-d SMA). Meanwhile, supports are near 1414 (30-d SMA) and 1400 psychological levels.

Daily KLCI Will Expect Some Profit Taking Consolidation Amid Extremely Overbought Slow Stochastic

FBM KLCI 14-10-2011

Source: HLIB Research

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