Bulls failed to sustain intraday gains; maintain short positions. The FKLI failed to hold on to its earlier session’s positive tone, and settled 2.5 pts weaker at 1,541.5 pts. Trading ranged between 1,538 pts and 1,549 pts. The negative session indicates that there was no positive follow-up from the prior sessions’ rebound, which set in after the immediate support of 1,538.5 pts was briefly tested. As a trend, we believe the retracement that resumed on the failed attempt to cross the resistance zone of 1,557.5-1,566.5 pts is still firmly in place, and that the 3 Feb’s low of 1,518.5 pts is still at risk of being retested. As such, we maintain our negative trading bias.

Traders are advised to stay in short positions. We initiated these at 1,548.5 pts, the closing level of 12 Feb. To manage risks, a stop-loss can be placed above 1,566.5 pts.

The immediate support is set at 1,538.5 pts, the low of 10 Feb. This is followed by 1,526.5 pts, derived from 5 Feb’s candle. Moving up, the immediate resistance is set at 1,550 pts, derived from 12 Feb’s candle. This is followed by 1,560.5 pts, the high of 11 Feb.

Source: RHB Securities Research - 18 Feb 2020