As indicated by A, the FBM KLCI rose 22.92 points or 1.59% on Monday, breaking above the 1453 resistance, to close at 1465.35 points. Next resistance for the KLCI is at 1490, which is the 61.8% Fibonacci Retreacement Line. Support for the KLCI is temporary at 1453.

As indicated by B, total market volume increased 65.57%, continue to stay above the 40-day volume moving average. This suggests that the local market is still actively participated, as inflow of fresh capital increases to absorb profit taking's selling pressure. Technically, if volume should stay above the 40-day volume moving average, the market sentiment is likely to continue to improve.

As indicated by C, the Stochastic is still above 90%, which is an over-bought region. This suggests that the short term movement of the KLCI is indeed over-heated, thus a risk of a pull back is imminent.

In conclusion, the KLCI is temporary breaking away from its downtrend, but still not yet forming an uptrend. Technically, it would have to form higher-lows, in order to show the characteristic of an uptrend formation.

Find this analysis useful? Why not share it with others? Click Here to send this to a friend

Straits Index (M) Sdn Bhd
No. 16, Jalan LP 1A / 5, Lestari Perdana,
43300 Seri Kembangan, Selangor
Hotline: (03) 8941 6828  (5 lines)   Fax: (03) 8941 9828
Email: info@straitsindex.com
© Copyright 1997-2010 Straits Index (M) Sdn Bhd All rights reserved