Maintain short positions. The FKLI failed to stage a rebound yesterday after it close unchanged at 1,590.5 pts. The index opened 0.5 pts lower at 1,595 pts, then whipsawed during the session between 1,597 pts and 1588.5 pts before ending at its opening. Since it remained below the psychological level of 1,600 pts and 50-day SMA line, while the RSI remained below the 50% level, the bearish bias remains as mentioned in our previous note. As such, we stick to a negative trading bias.

Traders should stay in short positions. We initiated these at 1,595 pts – 30 Apr’s close. For risk management purposes, we set the stop-loss at 1,606 pts.

The support level stays at 1,588 pts (8 Apr’s low) and 1,570.5 pts, or 6 Apr’s low. Towards the upside, the resistance levels are maintained at 30 Mar’s high of 1,612.5 pts and 1,625 pts, or 26 Apr’s high.

Source: RHB Securities Research - 5 May 2021