Bears are still in control; maintain short positions. The latest session saw the FKLI shed 7.5 pts to close at 1,585 pts. The low and high were recorded at 1,584.5 pts and 1,596 pts. The weak session suggested that the bears are still firmly in control – after the index failed to breach above the 1,600-pt round figure in recent sessions. Towards the downside, we are still expecting the immediate support of 1,573 pts to be tested. This negative would still remain as long as the index is still unable to cross above the 1,621.5-pt immediate resistance. Maintain negative trading bias.

With the negative bias continuing to show signs of extending, traders are recommended to stay in short positions. We initiated these at 1,668 pts, the closing level of 12 Jul. To manage risks, a stop-loss can now be placed above the 1,621.5-pt mark.

We continue to expect the immediate support to appear at 1,573 pts, the low of 14 May. This is followed by the 1,550- pt mark. On the other hand, the immediate resistance is set at 1,621.5 pts, the high of 9 Aug. This is followed by 1,660.5 pts, the high of 24 Jul.

Source: RHB Securities Research - 28 Aug 2019