Maintain short positions. The FKLI generally trended lower for the entire session, moving from a high of 1,577 pts to a low of 1,556.5 pts, before closing 17 pts weaker at 1,560.5 pts. The negative performance means there was no positive follow-up from the prior session’s strong performance, ie no confirmation of a positive price reversal. We regard the retracement phase that started from the failed attempt to cross above the 1,621.5 pst resistance as still incomplete. As such, we are maintaining a negative trading bias

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 1,555 pts, the price point of 15 Aug. This is followed by 1,541 pts, the low of 12 Aug. Conversely, the immediate resistance is set at 1,577.5 pts, which is the high of 13 Aug. This is followed by 1,585 pts, a point near 7 Aug’s high.

Source: RHB Securities Research - 17 Aug 2020