Maintain long positions. The FKLI charted an indecisive “Doji” candlestick in the latest session – indicating that neither bulls or bears have clear control over the intraday performance. This came after the index swung from a low of 1,588 pts to a high of 1,605 pts, before closing 3.5 pts softer at 1,595 pts. Despite the indecisive performance, the index continues to trade within the trajectory of extending its multi-month uptrend. This is as we believe its 2-week sideways consolidation phase – which took place above the 1,572.5-pt support level – has likely concluded. Towards the upside, we expect the FKLI to cross above July’s “Double Top” formation high of 1,621.5 pts. We maintain a positive trading bias.

We recommend that traders remain in long positions. We initiated these at 1,611.5 pts, the closing level of 26 Nov. To manage risks, a stop-loss can be set below 1,572,5 pts.

The immediate support is still at 1,590 pts, followed by 1,572,5 pts. Towards the upside, the immediate resistance is at 1,600 pts, followed by the “Double Top” high of 1,621.5 pts.

Source: RHB Securities Research - 3 Dec 2020