Maintain long positions. After cancelling the recent weakness last Thursday, the FKLI recorded another positive momentum the day after, thereby forming a “White Marubozu” candle. It closed 7 pts higher, at 1,611 pts – approximately near the immediate resistance of 1,612.5 pts. The index opened with a weak momentum, gapping down to the 1,600-pt psychological level, but then swiftly bounced off on strong momentum throughout the session to touch the day’s high of 1,612 pts, before it closed at 1,611 pts. The RSI strengthened further at 55%, which increased the possibility of pushing past the immediate resistance point of 1,612.5 pts. As such, we reaffirm our positive trading bias.

Traders should stay in long positions. We initiated these at 1,596 pts, or the closing level of 7 Apr. For risk management purposes, a stop-loss is set below 1,588 pts.

The support levels stay at 1,588 pts and 1,570.50 pts (6 Apr’s low). Towards the upside, the immediate resistance level remains at 30 Mar’s high of 1,612.50 pts. This is followed by 1,625 pts, or 30 Mar’s high.

Source: RHB Securities Research - 26 Apr 2021