Another weak close; lacks positive momentum. The FBMSC staged another weak performance yesterday. It slipped 69.23 pts to close at 15,042.66 pts, leaving a black candle at the end of the session. This shows that the bullish momentum above the 14,815-pt level still lacks positive catalysts. As a result, the reversal “Bullish Harami” candlestick pattern of 22 Jan remains unconfirmed. Based on the daily chart above, we think that the 1-month rebound was merely a result of the index taking a minor breather. This is normal reaction especially after the FBMSC plunged firmly below the 200-day MAV line.

Based on our immediate view, as the RSI Indicator has not fallen below the 30-pt oversold level, this suggests that the downside movement has more room to go. Meanwhile, the appearance of the “Negative Divergence” pattern indicates that the recent uptrend from Oct-Dec 2015 may have reached its limit.

Presently, our immediate support is pegged at 14,815 pts, obtained from the bottom of the abovementioned “Bullish Harami” pattern. The next critical support is seen at 14,543 pts, ie 29 Sep 2015’s low. Conversely, we set the immediate resistance at 15,441 pts, which was 14 Dec 2015’s low. If this line is violated, look to the 16,141-pt level – ie 7 Jan’s high – as the next critical resistance.