TECHNICAL INDICATIONS
FM KLCI Support : 1320 Resistance : 1377, 1400
Bias : Downtrend
Yesterday’s rebound had effectively filled the gap at 1,357-1,365 levels beautifully. Despite the rebound, the index is still trading within the down trending channel and below the 5-day and 10 day moving averages. Hence, the technical outlook is frail with the indicators still below their lower limit line and downward sloping support channel.
FBM KLCI Daily Chart: click to enlarge:
Regional rebounds spill over … In line with regional markets, the market rebounded sharply to regain part of losses sustained earlier. Several index-linked counters bounced back from oversold positions while several lower liners also participated in the upswing momentum.
Eurozone debt worries also took a breather that helped in the rebound process. If external factors stabilize, the prospects of further recovery are good.
Downside to return? …. We reiterate that a failure to break free from the current channel will have adverse consequences by affecting market sentiment that had begun to unravel on unfavorable external developments.
by Mercury Research
