RHB Retail Research

FKLI: Rejected By The Resistance

Publish date: Tue, 16 Nov 2021, 08:39 AM
0 9,020
RHB Retail Research

Maintain long positions. The FKLI saw strong profit taking yesterday, pulling back 9.50 pts to settle at 1,522.50 pts. The benchmark index initially opened at 1,532 pts and climbed higher on positive sentiment, touching the 1,538-pt intraday high. However, selling pressure emerged near the 1,537.50-pt resistance as the index retraced towards the session’s low of 1,518 pts and closed weaker at 1,522.50 pts. If the profit taking activities extend, the index may correct downwards to test the 1,512-pt support. Breaching the threshold would see the index falling to Oct’s low at the 1,505-pt level. Observe that the index is trading far away from the 50-day SMA line, we think there is still a possibility to see a technical rebound in the near term to retest the moving average line. We uphold the bullish trading bias until the stop-loss is breached.

We recommend traders maintain long positions, which were initiated at 1,532 pts or the closing level of 12 Nov. To protect the downside risks, an initial stop-loss is placed at 1,500 pts.

The nearest support changed to 1,512 pts – 11 Nov’s low – followed by 1,505 pts, or the low of 5 Oct. The immediate resistance stays at 1,537.50 pts, the high of 9 Nov, followed by 1,546.50 pts, or 3 Nov’s high.

Source: RHB Securities Research - 16 Nov 2021

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