FBMKLCI
Trading by Ourselves?
Yesterday, the FBMKLCI went against the regional markets (regional markets mostly closed in negative territory) and closed near to its day’s high. Will this trend continue even with the Dow dropped nearly 200 points yesterday? Hard to say whether the budget-rally will resume or not, however, I reiterate, I remain my view that this is only a technical rebound. Thus, investors should take this opportunity to take profit on your stocks.
The overall technical landscape never change – downtrend! The immediate resistance is seen at 1377 (Fibonacci level of 23.6%), followed by the gap created on 23rd of September - 1380 level (please refer to the chart below). The immediate support is seen at 1350 level, followed by 1330 level.
As for SP Setia, since it is being offered to be taken over and being suspended for the time being, I shall not cover any report on the stock’s outlook at the moment. Tomorrow, we shall have a look at CIMB stock, whether this stock is worthwhile to pick up now?
FKLI
Immediate Resistance – 1366!
The same technical landscape faced by FKLI as well, however, the FKLI faces the immediate resistance at 1366 – Fibonacci level of 23.6%, followed by the gap set on 23rd of September – 1370 level.
What should investors do? Those who have initiated long position, you can either choose to set your stop loss level slightly below 1350 level and continue to hold on to your long position until it expires this Friday or just take profit before the end of today (ahead of the budget announcement tomorrow).
For those who yet to initiate any position, I am still looking for opportunity to sell on strength rather than buying on weakness. If the FKLI unable to break through the 1370 level convincingly, investors can initiate short position with the stop loss level to be set around 1380 level, else, we just wait patiently for the opportunity to initiate short position.
FCPO
Change of Strategy…
Although the FCPO yet to show a clear market direction, I will like to revise my call towards the market. If the FCPO unable to sustain convincingly above the 2918 & 2900 levels, I will change my strategy to initiate short position rather than long position with the stop loss level being set around 2918 level. Reasons supporting my view (please refer to the chart below for reference):-
1) The FCPO may take over the Fibonacci level of 38.2% convincingly.
2) As per mentioned, if the FCPO broke through the range trading with downward pressure, the FCPO may resume its downward trading.
3) The FCPO still trading below the Bollinger middle band with the upper and lower band widening – this is indicating the downward pressure will resume.
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