Straits Index (M) Sdn Bhd
WinChart Technical Analysis
Daily Market Analysis
Send to a Friend Composite Index 12/11/2010
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As indicated by A, the FBM KLCI took a dip on Friday, together with falling regional markets. The KLCI had its intra-day low or 1488.06, but managed to rebound, closing at 1499.81 points, losing 13.89 points or 0.92%. Immediate support for the KLCI is at 1487.17 while the resistance is at 1500.

As shown on the chart above, the Bollinger Bands contracted 1%, suggesting that the KLCI is still consolidating or having its technical correction. However, with the KLCI now below the Bollinger Middle Band, the immediate technical outlook for the KLCI is on the negative side.

As indicated by B, total market volume increased 9.39%, with volume above the 40-day volume moving average. If volume should remain high while the KLCI is falling, it implies that the selling pressure is high, thus it would dampen the market sentiment.

As indicated by C, the Stochastic fell below 30% by margin, and if the Stochastic should stay below 30%, it would be a short term bearish signal for the KLCI. If the Stochastic could rebound and stay around 50% level, the short term movement of the KLCI is expected to be in a sideways manner.

In conclusion, profit taking pulled down the KLCI, but it is too soon to call for a downtrend formation, as the KLCI is still testing the 14, 21, 31 EMA.

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