No confirmation for a reversal; maintain short positions. The FKLI formed a white candle to settle the latest session 26.5 pts stronger to close at 1,577.5 pts, after crossing above both the previous immediate resistance of 1,565 pts and the 50-day SMA line. We see the positive session as just a rebound following the prior sessions’ retracement. However, it remains insufficient to signal a positive trend reversal. Hence, we are keeping our negative trading bias.

Until further a positive signal emerges, traders are advised to remain in short positions. We initiated these at 1,569.5 pts, the closing level of 3 Aug. To manage risks, a stop-loss can now be set above 1,585 pts.

We revise the support levels to 1,565 pts and 1,555 pts – both are derived from the latest candle. Moving up, the immediate resistance is eyed at 1,585 pts, a point near 7 Aug’s high followed by 1,600 pts.

Source: RHB Securities Research - 14 Aug 2020