No clear signals from the bulls yet; maintain short positions. The FKLI ended the latest session slightly lower by 1-pt at 1,644 pts. This was as it failed to hold onto its earlier session’s positive tone – the high and low were at 1,649 pts and 1,641.5 pts. While the index is trading above its recent low, there was positive follow-through yet to indicate a deeper rebound or total price reversal is in the process of developing. For now, as long as the index is still capped by the immediate resistance of 1,656.5 pts, the negative bias that started from the 1,729 pts level would still be considered as valid. Maintain our negative trading bias.

As the bulls are still now able to show strength to drive the index’s price direction, we continue to advise traders to stay in short positions. These were initiated at 1,698 pts, the closing level of 1 Mar. To manage risks, a stop-loss can now be placed above 1,656.5 pts.

The immediate support is still expected at 1,600 pts, this is followed by 1,550 pts. Moving up, the immediate resistance is set at 1,656.5 pts, the high of 26 Mar. This is followed by 1,694.5 pts, the high of 19 Mar.

Source: RHB Securities Research - 8 Apr 2019