Weekly Recap

Following a strong rebound move on Wall Street two week ago, U.S. stockmarkets started the week on a softer note as investors took profit ahead of the FOMC meeting that was held on 16th-17th Sept; the Dow fell 62.13 pts to 16,370.96 pts on Monday. However, the key index rebounded and ended at 16,599.85 pts (+228.89 pts) and 16,739.95 pts (+140.10 pts) respectively on Tuesday and Wednesday. Nevertheless, as the Fed concluded the FOMC meeting, keeping its interest rate policy unchanged, the Dow fell 65.21 pts to 16,674.74 pts on Thursday, followed by another tumble of 290.16 pts to 16,384.58 pts on Friday - led by energy shares amid weaker crude oil prices. On a W.o.W basis the Dow lost 48.51 pts.

Meanwhile, share prices on Bursa Malaysia started the week on a strong footing as the Prime Minister announced a RM20.0 bln boost to the stockmarket – the FBM KLCI gained 36.03 pts to 1,639.63 pts on Monday as investors flocked into index heavyweights like Tenaga Nasional and Genting Bhd. Further follow-through buying interest was noted ahead of the FOMC meeting and the FBM KLCI added 7.52 pts to 1,647.15 pts on Tuesday, followed by another jump of 34.39 pts to 1,681.54 pts on Thursday. However, as the Fed concluded the meeting without raising interest rates, the key index declined 12.09 pts to end the week at 1,669.45 pts as profit taking activities emerged on Sime Darby and CIMB. Nevertheless, on a W.o.W basis the FBM KLCI advanced 65.85 pts, its best weekly gain since May 2013.

FBM KLCI Weekly Technical Readings

The weekly MACD Histogram has hooked upwards, in tandem with the weekly MACD Histogram’s movement. The weekly RSI has hooked above 30.

Meanwhile, the daily MACD Line has crossed above zero, but the daily RSI has tripped below 70.

FBM KLCI Support & Resistance

Last week, the FBM KLCI continues to rebound above the 1,660 resistance level as investors cheered the RM20 bln package. The FBM KLCI retested the neckline around the 1,692 level but selling activities were noted. As the daily RSI has tripped below 70 – it could be suggesting that the short term momentum is fizzling off and the FBM KLCI’s upside may be capped to around 1,700. Meanwhile, support will be pegged around the 1,640-1,660 levels.

Moving Forward

Wall Street may pullback further as the Dow and S&P 500 has retested and forming a potential reversal formation around its resistance at the 17,000 and 2,020 levels respectively. Similarly, share prices on the FBM KLCI may see selling pressure picking up as the FBM KLCI has revisited the neckline of 1,690. Nevertheless, traders may look out for trading opportunity among export-related stocks on the back of weaker Ringgit position.

Sector focus

The FBM ACE market has trended sideway between the 5,350-5,512 levels. The MACD Line is approaching zero, but the RSI is overbought. Monitor for a breakout above 5,512, targeting 5,893. Support will be set around 5,350.

Stocks to focus

MMSV – Price trended sideways between the RM0.655-RM0.685 levels over the past two weeks. The MACD Line is approaching zero, but the RSI is overbought. Monitor for a breakout above the RM0.685 level, targeting the RM0.74-RM0.78. Support will be set around RM0.65.

IFCAMSC – Price trended sideways between the RM0.80-RM0.875 levels over the past two weeks. The MACD Line has crossed above zero, but the RSI is overbought. Monitor for a breakout above RM0.845, targeting the RM1.00 level. Support will be pegged around the RM0.80 level. 

Source: M+ Online Research - 21 Sep 2015