The FBM KLCI did not extend higher after surpassing the indecisive “Spinning Top” candlestick pattern last Wednesday. Although the index pulled back by about 6 pts yesterday, we still believe that the bulls have the upper hand over the bears at above the previous historic high of 1,577 pts. Moreover, the index is still trading comfortably at above the short-term uptrend line.
The near-term technical outlook of the market remains firmly bullish. Moreover, after yesterday’s retracement, the daily RSI pulled back to the 66.6 pt-level, which means that the market is still far from entering overbought territory, which is beyond the 80-pt level for the 2009- 2011 bull market.
From the current level, immediate resistance lies at the 1,597 pt-level, followed by the 1,600- psychological level. To the downside, there is immediate support at the 1,579 pt-level followed by the 1,577 and the 1,565 pt-levels.
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