The bulls live above the 200; below that, the bears
Most technical momentum indicators for the FBMKLCI stay bearish amid weak buying
momentum, blue chips are likely to extend low-volume consolidation as the end of the month
approaches. However, rotational trading plays on lower liners and small-cap stocks are
noticed to pick up and attract speculative retail interest, hence trading momentum is likely to
switch focus to the broader lower tier counters, as blue chips extend consolidation.
Technically, immediate upside hurdle remains at the 200-day moving average currently
residing at 1,635, with next resistance at 1,643 and 1,644, the respective 50 and 100-day
moving averages, and stronger resistance at 1,658, the 23.6% Fibonacci Retracement (FR) of
the 1,526 low of May 2012 to the 1,699 record high of Jan 2013. Immediate support is
downgraded to 1,613, the 50%FR, with 1,599 and 1,592, the 61.8%FR, acting as stronger
support platforms.
In a nutshell, the FBMKLCI ain't going nowhere higher until the prices can break above the 200 MA or 1635.00 resistance whereby the FKLI will most probably be in premium versus the cash index.
GOOD LUCK
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