Maintain short positions. The FKLI has traded sideways for two consecutive sessions after the recent climb and closed 1.5 pts lower at 1,583 pts yesterday. The index opened at 1,586.5 pts and traded in a tight range between the high and low of 1,589.5 pts and 1,580 pts before closing at 1,583 pts – below the 50-day SMA line. As the RSI indicator remains below the 50% threshold, the bullish signs have yet to emerge. As the rebound did not trigger the previous stop loss, we maintain a negative trading bias.

We recommend traders keep to short positions, which were initiated at 1,593.5 pts, or the close of 23 Mar. To manage risks, the trailing stop is set at 1,590 pts.

The immediate support level is unchanged at 26 Feb’s low of 1,550 pts and followed by 9 Oct 2020’s high of 1,539.5 pts. On the upside, the immediate resistance stays at 29 Mar’s low of 1,593 pts, followed by 30 Mar’s high of 1,612.5 pts.

Source: RHB Securities Research - 6 Apr 2021