Our bullish view since early April remains in play above the 13,719-pt mark. After three weak performances in a row, the FBMSC finally rebounded by 22.49 pts to 13,974.53 pts yesterday. As a result, a small white candle was formed after the index hovered between a low of 13,893.96 pts and high of 13,979.11 pts. We see that the FBMSC is managing to hold above the 13,719-pt support, which indicates that the bullish bias we have been witnessing since early April is still exerting itself.

In the absence of a strong downside movement, this implies that the bulls are still dominating market sentiment. For the record, we initially detected an early signal that the trend was shifting towards the upside from a downside move previously. This was after the appearance of 5 Apr’s “Bullish Harami” and 6 Apr’s “Hammer” reversal patterns at the index’s 2-year low. Overall, we maintain our positive view.

Our immediate support is maintained at 13,719 pts, which was the low of 5 Apr’s “Bullish Harami” pattern. In the event that this level is taken out, the following support is found at the 13,116-pt mark, or 25 Aug 2015’s low. Meanwhile, we keep the immediate resistance at 14,578 pts, which is located at the high of 14 Jun. For the next resistance, look to 15,188 pts, or 17 Apr’s high.

Source: RHB Securities Research - 29 Jun 2018