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Wednesday, June 22, 2011

A Chance to Crack 1,565 (OSK)

The FBM KLCI still stands a good chance of violating the 1,565 pt-level after having experienced three failed breakout attempts since March. Last Friday’s rebound from the potential short-term uptrend line has helped to keep the index in a healthy technical posture. A breakdown from the projected trend line coupled with a retrace back below the 1,474 pt-level would have complicated the stock market’s near-term technical outlook.

At this juncture, we can safely say that the index’s consolidation of its 15.5-pt gain recorded on 13 May 2011 has been healthy even though the KLCI had at one point given up more than 50% of those gains. Meanwhile, we continue to maintain our near-term bullish view.

Market support is still seen at the 1,544 pt-level, followed by the 1,517 pt-level. To the upside, there is immediate resistance at the 1,565 pt-level, followed by the 1,577 historic high.

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