Expect futures to trade range bound today with an upward bias after gains in overnight US markets. Investors cited the improved US consumer confidence and the sharp drop in oil prices as the main catalysts. Back home, FBMKLCI settled modestly lower at 1556.73. The index traded range bound after opening at its high.
However, investors took this opportunity to partake in profit taking activities as selling pressure was exerted throughout the day. Some late buying in the late afternoon acted to limit the losses for the day. Leading lags on the index were energy and telecommunication stocks. Market sentiment slightly improved as futures narrowed its discount to the underlying cash to almost parity.
Futures settled marginally higher at 1556.0, up 0.1 percent. Futures traded range bound, which experienced selling pressure in the morning session, however this was countered by buying
pressure throughout the afternoon session. Price action was depicted by the formation of a spinning top candle indicating indecisiveness as investors await fresh leads. Volume was dominated by roll activities as investors switch their attention on to the March contract.
As such, support and resistance levels pegged at 1550.0 and 1562.5 respectively.
Strategy : Aggressive trade may short with a stop at or above 1563.0.