ZLBT Chats

Friday, August 16, 2013

FKLI Daily Preview 16082013

Expect futures to take a bearish turn today after US markets posted two consecutive days of steep decline. However, do expect the local market to be reasonable supported by Moody’s report which dictated Malaysia’s outlook to be stable. The vicissitude in US shares relates to disappointing results and outlooks from Wal-Mart and Cisco.

Additionally, reports showing that jobless claims fell to a six-year low and rising consumer prices generated further speculation that the Federal Reserve will soon trim its effort in supporting the economy. The Fed’s next policy meeting will be held on 17-18 September, whereby its outcome will be heavily anticipated for any changes in its quantitative easing programme.

Back in the local front, FBM KLCI descended marginally by 0.08 percent, closing at 1792.21. Gains were witnessed during the early trading session despite a steep fall in the US overnight market.

However, selling picked up towards the closing bell which reversed earlier gains. The energy and

banking industries were major losers for the day, Petronas Dagangan, Petronas Gas, Ambank, Maybank, and Hong Leong Bank to name a few.

Futures trade at a further premium of 6 points away from its underlying cash market.

Futures closed at a gain of 0.11 percent and settled at 1798. Trading activities wobbled between positive and negative territory as buyers remained hesitant of upward potential. Chart wise, a white candle was formed, whereby prices managed to close higher than overnight levels amid uncertainties. MACD indicator also journeys towards a buy signal.

However, expect prices to open gap down as the market takes cue of the fall from the US overnight market. Buyers may step in to take advantage of low prices during early trades. Nevertheless, downside risk remains eminent and selling activities will intensify upon breaching immediate
support at 1793. As such, support and resistance can be eyed at 1780 and 1810 respectively.

Trade may short with a stop on or above 1810.

Thursday, August 1, 2013

FCPO Preview Outlook 01 Aug 2013


The FCPO active month contract ended slightly higher due to good export reports released on Wednesday. ITS and SGS released the figures showed that Malaysia palm oil export up 4% and 5% respectively.  

Futures settled at 2236, up 21 points. Prices were caught in a tight range and hovered between losses and gains but remained steady above 2200 level. The formation of a small bodied white candle with longer upper shadow indicates buyers outweighed sellers for most part of the day and managed to lift prices from its day low. Higher high and higher low formed could add to confirmation of a bullish reversal despite a mild profit taking after the strong rebound yesterday. This could imply improved sentiment and MACD is seen approaching a bullish divergence where a cross above would provide more signs of price recovery. As such support and resistance can be pegged at 2200 and 2275 respectively.

Trade may long with a stop on or below 2200.

FKLI Preview Outlook 01 Aug 2013

FBM KLCI Futures Technicals
The FKLI spot month contract ended sharply lower on heavy selling pressure after Fitch, a global rating agency downgraded Malaysia’s sovereign credit rating. At the close, the FKLI Spot wiltered down 23 points to 1,774.5.

August futures prices cascaded 1.83 percent to close at 1766. Trading activities formed a long black candle, whereby selling activities intensified throughout the day. Prices were fragile as it violated major support levels to close below its 20 and 50 day moving averages.
Heavy sell-off triggered after the price broke below the two important support levels. As we can see in the chart, the trend is turning weak after it broke below the support line as drawn in the chart and this is also confirmed by the MACD indicator.
Moreover, MACD extended its selling signal for a third consecutive day, hinting more bearish potential. Thus, support and resistance for the day can be eyed at 1750 and 1775 respectively.
Intraday technical support & resistance for 1/8/2013
1st support 1,765; 2nd support 1,753-50
1st resistance 1,775-80, 2nd resistance 1,800

Trade may short with a stop on or above 1775.

Tuesday, July 23, 2013

FCPO >>> Technically weak and in slow recovery mode

FCPO Daily technical analysis

The FCPO active month contract ended slightly higher due to slightly improved in palm oil export released on Monday which underpinned the FCPO prices. ITS and SGS showed Malaysia palm oil export down 14% and 13% respectively. At the close, the FCPO up 15 points or 0.67% to 2,272.

Based on the daily chart, a small positive candle with lower wick has been formed on Monday where it indicated that the price was supported at the intraday lowest level.

Currently, the FCPO price still lingers between the range of 2,215 and 2,300. We should monitor closely which way it will break in the near term. Strong support level we would peg at 2,215 then followed by the psychological level of 2,200.

Referring to the MACD indicator, both lines staying in the negative zone. As always, intraday support and resistance levels will be eyed.

Technical indicators
MACD= Negative, ADX= Negative
Intraday technical support & resistance for 23/07/2013

1st support 2,215-00; 2nd support 2,170
1st resistance 2,280; 2nd resistance 2,305
Trade may attempt long with a stop on or below 2240.

FKLI 23/07/2013 >>> Previews and Technical Outlook

Expect futures to trend higher for the day, tracking gains in major bourses around the globe. In the US, the S&P 500 staged a third consecutive day of record high closing while dismal earnings from
McDonalds curbed gains in the Dow. Nevertheless, solid performance in the financial and health sectors managed to sustain gains. Back home, the FBM KLCI ended unchanged at 1797.68.

The local index ended flat after trading higher for most part of the day on last minute foreign selling activities. Meanwhile, volume across the board was thin as investors await the release of corporate earnings for the second-quarter prior to making investment decisions. The market was weighed down by British American Tobacco, Hong Leong Bank, and Kuala Lumpur Kepong Bhd. On the other hand, telecommunication stocks provided support for the market as Digi released favorable corporate earnings. Futures were still being traded at a premium of circa 4 points from its underlying cash market.
Futures prices drifted 0.17 percent higher to settle at 1801.50. Trading activities was depicted through the formation of an inverted white hammer, which is considered a bearish signal during an uptrend. Moreover, 20 day moving average now lies above the 50 day moving average and prices stray further away from its 20, 50, and 100 day moving averages, which suggest a bullish trend. As such, support and resistance can be eyed at 1790 and 1810 respectively.

Technical indicators
MACD= Positive, ADX= Positive
Intraday technical support & resistance for 23rd July 2013
1st support 1,790; 2nd support 1,785-80
1st resistance 1,806.5, 2nd resistance 1,810-15

Trade may long with a stop on or below 1790.