Maintain short positions as the index is merely taking a minor pause. The FKLI halted its decline, settling 9.5 pts higher at 1,466 pts. The low and high were recorded at 1,452 pts and 1,474 pts. We see the positive session as just a minor pause by the bears after the recent retracement came subsequent from the downside breach of the 1,500-pt multi-year support level. The positive sessions do not suggest that the index’s retracement has reached an end. Premised on this, we are keeping our negative trading bias.

As the bearish trend is still firmly in place, we advise traders 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 1,487.5 pts.

The immediate support is revised to 1,452 pts, the latest low, followed by 1,444 pts, the low of 2 Mar. Towards the upside, the immediate resistance is set at 1,474 pts, the high of 2 Mar, followed by 1,487.5 pts, the high of 28 Feb.

Source: RHB Securities Research - 4 Mar 2020