The DJIA’s 172-pt drop last Friday caused negative spillover effects on the FBM KLCI yesterday. The index gapped down at the opening bell and ended losing 10.3-pts to the day’s worst level.
The index has marginally violated the projected uptrend line which we have been talking about since late last week. This uptrend line, which still needs to be confirmed, is supposed to help us to detect early signs of the end of the consolidation of the market’s 15.5-pt gain on the last trading day of May. We shall see if the index could stage a strong rebound today to recoup all the losses suffered yesterday. If not, we would have to use the opening point of the 31 May session to gauge the health of the market consolidation.
We also said before that even if the index would one day retrace back below the 1,544 pt-level, the level which was previously the breakout point marking the end of the nearly 2-month old sideways trend, it would not really bother us as long as the index does not close below the opening point of the 31 May session, or the 1,541.5 pt-level. .
Although the index has retraced by more than 50% of the previous 15-pt gain, its consolidation has been healthy. Hence, we continue to maintain our near-term bullish view.
Market support is still seen at the 1,544 pt-level, followed by the 1,541.5 pt-level and the 1,517 pt-level. To the upside, immediate resistance lies at the 1,551-1,556 pt-area, followed by the 1,565 pt-level.
The index has marginally violated the projected uptrend line which we have been talking about since late last week. This uptrend line, which still needs to be confirmed, is supposed to help us to detect early signs of the end of the consolidation of the market’s 15.5-pt gain on the last trading day of May. We shall see if the index could stage a strong rebound today to recoup all the losses suffered yesterday. If not, we would have to use the opening point of the 31 May session to gauge the health of the market consolidation.
We also said before that even if the index would one day retrace back below the 1,544 pt-level, the level which was previously the breakout point marking the end of the nearly 2-month old sideways trend, it would not really bother us as long as the index does not close below the opening point of the 31 May session, or the 1,541.5 pt-level. .
Although the index has retraced by more than 50% of the previous 15-pt gain, its consolidation has been healthy. Hence, we continue to maintain our near-term bullish view.
Market support is still seen at the 1,544 pt-level, followed by the 1,541.5 pt-level and the 1,517 pt-level. To the upside, immediate resistance lies at the 1,551-1,556 pt-area, followed by the 1,565 pt-level.
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