Technical Speaking by S.N.LOCK - Article from Business Times.com.
Next week, the index's envisaged resistance zone hovers at the 897 to 930 levels while its immediate downside support is at the 856 to 890 levels.
SHARE prices on Bursa Malaysia rebounded in earnest in a holiday-shortened week. The Kuala Lumpur Composite Index (KLCI) continued to stay below its support of 900 points when it closed at 894.36 yesterday.
The KLCI opened higher at 868.70 before rebounding to close at its intra-day high of 881.63 on Tuesday, giving a day-on-day gain of 14.28 points, or 1.65 per cent. Share prices on Bursa Malaysia opened higher before easing back on profit-taking selling pressure. The benchmark index closed at 876.75 on Wednesday, giving a day-on-day loss of 4.88 points, or 0.55 per cent.
The KLCI resumed its technical rally on the first trading day of 2009 yesterday. It rallied to close at 894.36, posting a day-on-day gain of 17.61 points, or 2.01 per cent.
Next week, the index's envisaged resistance zone hovers at the 897 to 930 levels while its immediate downside support is at the 856 to 890 levels.
SHARE prices on Bursa Malaysia rebounded in earnest in a holiday-shortened week. The Kuala Lumpur Composite Index (KLCI) continued to stay below its support of 900 points when it closed at 894.36 yesterday.
The KLCI opened higher at 868.70 before rebounding to close at its intra-day high of 881.63 on Tuesday, giving a day-on-day gain of 14.28 points, or 1.65 per cent. Share prices on Bursa Malaysia opened higher before easing back on profit-taking selling pressure. The benchmark index closed at 876.75 on Wednesday, giving a day-on-day loss of 4.88 points, or 0.55 per cent.The KLCI resumed its technical rally on the first trading day of 2009 yesterday. It rallied to close at 894.36, posting a day-on-day gain of 17.61 points, or 2.01 per cent.
On the foreign front, the Dow Jones Industrial Average rebounded in the last three trading days. It closed at 8,776.39 on Wednesday, giving a three-day gain of 260.84 points, or 3.06 per cent. The tech stock heavy Nasdaq Composite Index continued to stay above its critical support of 1,500. It closed at 1,577.03 on Wednesday, giving a three-day gain of 46.79 points, or 3.06 per cent.
Tokyo stocks continued to hold on to their technical composure over the last two trading days of last year. The Nikkei 225 Index closed at 8,859.56 on Tuesday, giving a week-on-week gain of 120.04 points, or 1.37 per cent. The Hong Kong stock market repenetrated its resistance of 15,000 yesterday. The Hang Seng Index closed at 15,042.81, posting a week-on-week gain of 858.67 points, or 6.05 per cent.
Back on Bursa Malaysia, the KLCI posted a week-on-week gain of 27.01 points, or 3.11 per cent. Among the other indices, the FTSE Bursa Malaysia Second Board Index added 39.27 points, or 0.98 per cent, to 4,032.13 but the FTSE Bursa Malaysia Mesdaq Index eased 83.84 points, or 2.44 per cent, to 3,346.86.
Following are the readings of some of the KLCI's technical indicators:
Moving Averages: The KLCI continued to stay above its 10-, 20-, 30-, and 50-day moving averages while it continued to stay below its 100- and 200-day moving averages.
Momentum Index: Its short-term momentum index continued to stay above the support of its neutral reference line.
On Balance Volume (OBV): Its short-term OBV trend stayed above the support of its 10-day exponential moving averages.
Tokyo stocks continued to hold on to their technical composure over the last two trading days of last year. The Nikkei 225 Index closed at 8,859.56 on Tuesday, giving a week-on-week gain of 120.04 points, or 1.37 per cent. The Hong Kong stock market repenetrated its resistance of 15,000 yesterday. The Hang Seng Index closed at 15,042.81, posting a week-on-week gain of 858.67 points, or 6.05 per cent.
Back on Bursa Malaysia, the KLCI posted a week-on-week gain of 27.01 points, or 3.11 per cent. Among the other indices, the FTSE Bursa Malaysia Second Board Index added 39.27 points, or 0.98 per cent, to 4,032.13 but the FTSE Bursa Malaysia Mesdaq Index eased 83.84 points, or 2.44 per cent, to 3,346.86.
Following are the readings of some of the KLCI's technical indicators:
Moving Averages: The KLCI continued to stay above its 10-, 20-, 30-, and 50-day moving averages while it continued to stay below its 100- and 200-day moving averages.Momentum Index: Its short-term momentum index continued to stay above the support of its neutral reference line.
On Balance Volume (OBV): Its short-term OBV trend stayed above the support of its 10-day exponential moving averages.
Relative Strength Index (RSI): Its 14-day RSI stood at the 60.87 per cent level yesterday.
Outlook
The KLCI's continuing technical rebound hit its intra-week high of 897.26 yesterday, moving into the confines of this column's envisaged resistance zone (870 to 904 levels). Chartwise, the index staged an overhead breakout of its immediate overhead resistance (See KLCI's weekly chart - A1:A2). It continued to stay below its intermediate-term downtrend (A7:A8) yesterday.
The composite index's daily trend continued to stay below its intermediate-term downtrend (See KLCI's daily chart - B3:B4). It continued to stay below its intermediate-term downside support (B1:B2).
The KLCI ended the year on a rather weak note when it closed at 873.43 on December 31, posting a year-on-year loss of 571.60 points, or 39.56 per cent. The FBM Second Board Index tumbled 2,778.34 points, or 41.27 per cent, to 3,954.01 while the FBM Mesdaq Index plunged 2,863.91 points, or 46.88 per cent, to 3,245.25.
Its daily and weekly fast MACDs (moving average convergence divergence) continued to stay above the support of their respective slow MACDs at the market close yesterday. Its monthly fast MACD continued to stay below its slow MACD. The index's 14-day RSI stayed at 60.87 per cent level yesterday. Its 14-week and 14-month RSI stayed at 35.39 and 32.02 per cent levels respectively.
The composite index staged an overhead breakout of its 50-day moving averages on December 30 and continued to stay above that at the market close yesterday. This signalled a shift in market momentum. With the shift in market momentum to the upside, the KLCI is now staging a re-test of its previous resistance high of 926.65 set on November 5 2008. A decisive breach of this resistance is likely to see a major trend reversal. Next week, the index's envisaged resistance zone hovers at the 897 to 930 levels while its immediate downside support is at the 856 to 890 levels.
Outlook
The KLCI's continuing technical rebound hit its intra-week high of 897.26 yesterday, moving into the confines of this column's envisaged resistance zone (870 to 904 levels). Chartwise, the index staged an overhead breakout of its immediate overhead resistance (See KLCI's weekly chart - A1:A2). It continued to stay below its intermediate-term downtrend (A7:A8) yesterday.
The composite index's daily trend continued to stay below its intermediate-term downtrend (See KLCI's daily chart - B3:B4). It continued to stay below its intermediate-term downside support (B1:B2).
The KLCI ended the year on a rather weak note when it closed at 873.43 on December 31, posting a year-on-year loss of 571.60 points, or 39.56 per cent. The FBM Second Board Index tumbled 2,778.34 points, or 41.27 per cent, to 3,954.01 while the FBM Mesdaq Index plunged 2,863.91 points, or 46.88 per cent, to 3,245.25.
Its daily and weekly fast MACDs (moving average convergence divergence) continued to stay above the support of their respective slow MACDs at the market close yesterday. Its monthly fast MACD continued to stay below its slow MACD. The index's 14-day RSI stayed at 60.87 per cent level yesterday. Its 14-week and 14-month RSI stayed at 35.39 and 32.02 per cent levels respectively.
The composite index staged an overhead breakout of its 50-day moving averages on December 30 and continued to stay above that at the market close yesterday. This signalled a shift in market momentum. With the shift in market momentum to the upside, the KLCI is now staging a re-test of its previous resistance high of 926.65 set on November 5 2008. A decisive breach of this resistance is likely to see a major trend reversal. Next week, the index's envisaged resistance zone hovers at the 897 to 930 levels while its immediate downside support is at the 856 to 890 levels.
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