Weekly Recap
U.S. stockmarkets started the week on a negative tone as uncertainties over the Greek debt issue clouded investors with a cautious market environment; the Dow fell 95.08 pts to 17,729.21 pts on Monday. The Dow, however, turned positive on the back of the better employment data reported by U.S. Labour Department, where job openings surged to 5.03 mln in December - the highest level since January 2001. Markets were further buoyed by the share price of Apple Inc. hitting record highs – the Dow increased 139.55 pts to 17,868.76 pts on Tuesday. Following a flattish trade on Wednesday, the Dow resumed its uptrend, rising 110.24 pts and 46.97 pts to 17,972.38 pts and 18,019.35 pts on Thursday and Friday respectively as the Ukraine-Russia geopolitical tension eased after a ceasefire agreement. Overall, the Dow jumped 195.06 pts last week.

Similarly, share prices on the local front were affected by the swing in crude oil prices, which traded back and forth around the US$50 mark; the FBM KLCI slipped 1.67 pts and 0.46 pts to 1,811.58 pts and 1,811.12 pts on Monday and Tuesday respectively. Further selling pressure was noted soon after the power tariff reduction was announced by the government and the key index further declined to 1,798.95 pts (-12.17 pts) and 1,789.07 pts (-9.88 pts) over the next two trading days respectively amid the selloff in Tenaga Nasional (-5.9% W.o.W). Bargain hunting activities, however emerged and the key index ended at 1,800.95 pts (+11.88 pts) on Friday. Nevertheless, on a W.o.W basis, the FBM KLCI tumbled 12.30 pts.

FBM KLCI Weekly Technical Readings
Both the weekly MACD Line and weekly MACD Histogram trended higher. The weekly RSI, however, is below 50.
Meanwhile, the daily MACD Line turned flattish over the past two trading days, while the RSI is hovering above 50.

FBM KLCI Support & Resistance
With the FBM KLCI rebounding off the EMA60 level (~1,780) and ended above the EMA9 level on Friday, the key index may extend its short-term bullish momentum (daily RSI above 50) this week. The resistance for the FBM KLCI will be pegged around the 1,820-1,840 levels. However, if the key index drops below the 1,780 level, further support will be set around the 1,750-1,770 levels.

Moving Forward
With the Eurozone issues subsiding after the ECB approved extra funding for Greek banks, coupled with the easing of the Ukraine-Russia tensions, investors may see more positive trading sentiments in the coming weeks. The Dow and S&P may re-challenge its all-time-high of 18,100 and 2,100 levels respectively. Meanwhile, the FBM KLCI should see further trading interest among oil and gas heavyweights amid the recovery of crude oil price to above US$50 per barrel mark.

Sector focus

The Industrial Products index ended above the EMA9 level and could be retesting the 132 level. The MACD Histogram has turned green, while the RSI is above 50. Monitor for a breakout above 132, targeting the 136 level. Support will be located around the 128 level.

Stocks to focus
OKA – Price has rebounded off the EMA20 level with improved volumes. The MACD Histogram has turned green and the RSI has hooked above 50. Price is likely to rally towards the RM1.00 level. Support is set around the RM0.84 level.

CMSB – Price experienced a consolidation breakout above the RM4.14 level with higher-than-average volumes. The MACD Indicator has expanded positively above zero, while the RSI is trending higher above 50. Price target will be envisaged around the RM4.60 level. Support will be located around the RM4.00 level.

Source: M+ Online Research - 16 Feb 2015