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Showing posts from August, 2013

Malaysia Bursa: Still Early to Bottom Fish?

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Aggravated  foreign  selling  on  index-linked  blue-chip  heavyweights  pressured  the  FTSE Bursa Malaysia KLCI (FBM KLCI) sharply lower last week, sliding down for a full closure of the  post-elections  gap-up  prior  to  a  mild  technical rebound  ahead  of  the  weekend.  Key triggers for the foreign selling were sell-offs in neighbouring markets due to reversal of fund flows back to the United States on speculations theFederal Reserve would reduce stimulus next  month,  and  Bank  Negara  Malaysia's  downgrade  of the  2013  gross  domestic  product (GDP) growth forecast to between 4.5 and 5 per centfrom 5 to 6 per cent previously.
below: FBM KLCI Weekly chart

For the week, the FBM KLCI tumbled 67.17 points, or3.76 per cent, to 1,721.07, with CIMB (-50 sen), Maybank (-53 sen),  Axiata (-39 sen), Tenaga (-42 sen) and Genting Bhd (-46 sen) contributing almost half of the index's loss. Average daily traded volume and value increased to 2.31 billion shares and RM2.84 billion…

Bursa Malaysia - Sentiment Damper From Potential Fed Tapering

SELL AMMB & RHB Capital Blue chips fell into profit-taking correction mode on Monday, but lower liners and smalls cap stocks  continued  to  attract  strong  rotational  trading  interest.  The  KLCI  lost  9.88  points  to end at 1,778.36, off an early low of 1,771.65 and high of 1,788.43, as losers beat gainers 515 to  339  on  extremely  heavy  trade  of  3.15bn  shares  worth  RM2.44bn,  with  trading  on  MAS consisting nearly a third of the total volume.

Support at 1,772, Next at 1,756
The weak technical picture on the blue-chip index, clouded further by external weakness due to  potential  tapering  of  bond  purchases  by  the  US  Federal  Reserve  next  month,  should dampen  near-term  sentiment.  Immediate  support  stays at  1,772,  the  23.6%  Fibonacci Retracement  (FP)  of  the  7/2/13  low  of  1,597  to  the  all-time  high  of  1,826,  with  stronger supports  coming  in  at  1,756,  the  rising  100-day  moving  average  level,  and  1,738,  the 38.2%FR level…

FBM KLCI – Going on its merry way despite the Dow’s drop

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Support: 1,723 to 1,788     Resistance: 1,790 to 1,826
FBM KLCI Weekly Chart (click to enlarge):

Strategy:  The FBM KLCI rose 8.92 points WoW on minor nibbling activities to close at 1,788.24
last Friday despite global volatility. Volume ranged from 1.59b to 2.42b shares traded.

The  index consolidated in a range of 801 to 936 from Oct 2008 to Apr 2009, but broke above 936.63 (Wave a/B) in Apr 2009. Its intermediate Wave b/B low was 836.51. We have traced out a
Wave C/B (of the Flat 3-3-5 variety) rebound phase, and revised our Wave Count of a Wave iv/B correction to 1,310.53. The current extended Fifth Elliott Wave (EW) of the major Flat v/C/B-leg correction  from  the  801.27  low  to  1,826.22  (on  6  May  2013)  has  obvious  bearish  divergence signals despite the index’s rise to all-time highs on a gap-up move after GE13. The FBM KLCI is in  overbought  and  bearish  divergent  territory  and  the  EW count  suggests  a  stalled  uptrend  at 1,826.22.  This  could  ca…