Maintain long positions. The FKLI ceased the latest session flat at 1,589.5 pts – this was after it fluctuated between a low and high of 1,583.5 pts and 1,598 pts. We continue to see the index experiencing a relatively narrow sideways trading range. This has been in development over the past two weeks following its prior upward move from the low of 1,476 pts on 29 Jun. Towards the downside, a deeper retracement may only happen should the 1,580-pt level be breached. Until this happens, we keep to our positive trading bias.

We advise traders to stay in long positions. We initiated these at 1,607 pts, the closing level of 17 Jul. To manage risks, A stop-loss can be placed below 1,580 pts.

We revise the immediate support to 1,580 pts followed by 1,575.5 pts – derived from the low of 20 Jul. On the other hand, the immediate resistance is set at 1,600 pts, followed by 1,615 pts.

Source: RHB Securities Research - 28 Jul 2020