Sunday, August 8, 2010

FBM KLCI correction

A strong ringgit performance on Monday was reflected by a strong moved upward in the local stock market with the benchmark FBM KLCI rose for the seventh consecutive days to close 2.68 points or 0.20% higher at 1363.60, after touching the intra-day high of 1368.43.

By the end of the week, FBM KLCI close lower to 1360.45 despite a robust Ringgit against the US Dollar.

The index has been slowly falling from its high despite Ringgit strengthening as indicators indicating an overbought situation. The market correction is expected to continue in early of this week as the current three days correction is still very shallow if we compared with the previous corrections.

Expecting the index to push downward to 1353.90. Resistance is at 1365.85.

The chart below is the derivative of FBM KLCI i.e. the Index Future contract- FKLI.

The last day of the week, it registered a bearish candle with close at 1363.00 and a low of 1362.5. As the FBM KLCI is expected to be bearish, the derivative will follow it. Set a sell below 1362.00 .


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