Maintain short positions. The FKLI ceased the latest session 3 pts higher at 1,515 pts. However, this marginally positive session does not suggest a firm follow-up from the prior session’s sharp positive intraday price reversal. At this juncture, the index is marginally above the 200-day SMA line. Towards the upside, should the index be able to close above the 1,520 resistance point at the closing, this would likely suggest a stronger rebound is ready to develop. Until this happens, we are keeping our negative trading bias.
Traders should 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 placed above 1,520 pts
. The immediate support is maintained at 1,500 pts, this is followed by 1,480-pts – 14 Sep’s low. Conversely, the resistance points stay at 1,520 pts and 1,544.5 pts – derived from 3 Sep’s candle.
Source: RHB Securities Research - 8 Sept 2020