Monday, November 14, 2011

KLCI Learn To Leave With Volatility

Bursa Recap: KLCI up 10 points in line with bullish regional markets
Tracking Dow Jones’ last Friday 2.2% surge, Asian markets closed on a bullish note, led by strong gains in TWSE (2.2%), KOSPI (2.1%) and HSI (1.9%) on hopes that new leaders in Italy and Greece will take decisive action to save their indebted nations from bankruptcy and pushing through reforms and austerity plans to restore their countries' tattered credibility.

On the back of bullish regional markets, FBM KLCI jumped 10.1 points to 1478.9. Daily traded volume ballooned 38% to 2.85 billion shares, the highest since 8 February 10, as ACE Market and penny stocks surged due to strong retail participation.

FBM KLCI Outlook: Learn to leave with volatility
While economic numbers indicate that things are slowly getting better, fundamentals are being ridden by lack of direction in the euro zone. Given the headwinds in Europe, we have to learn to live with the volatility in the near term. Technically, daily trend and momentum indicators are weakening and are pointing to more consolidations. Immediate resistance levels remain at 100-d SMA (now at 1489) and 200-d SMA (1508).

However, more positive readings on the weekly slow Stochastics and MACD should support further upside in the medium term. Thus, any downside consolidation will be well-supported by 1452 points (3 November intraday low) and 30-d SMA (1442 points).

Daily KLCI: More Downside If The Mid Bollinger Band Is Violated
FBM KLCI 15-11-2011

Source: HLIB Research

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