Maintain long positions. The FKLI’s bullish momentum tapered yesterday, as the index closed just 1 pt higher at 1,542.5 pts – recouping all intraday losses to close just above the opening. It opened at 1,541.5 pts, then fell towards the intraday low of 1,531 pts during the early session. After consolidating sideways, the index bounced upwards to reclaim the area above the opening, right before closing. Yesterday’s small white body candlestick – with a long lower shadow – indicates that the recent rally has paused, as it closed lower than the previous session’s high of 1,545 pts. We expect the index to move between 1,545 pts and 1,531 pts (the day’s low) in the immediate sessions, before firming up its direction. Nevertheless, the RSI being at 64% suggests that the positive momentum is still intact for the medium term. That said, we make no change to our bullish trading bias.

We recommend that traders stick to the long positions initiated at 1,496.5 pts, or the closing level of 1 Dec. To mitigate trading risks, we revise the trailing-stop to 1,531 pts, or its immediate support.

We revise the immediate support downwards to 1,531 pts or 29 Nov’s low, then 1,512.5 pts or 16 Nov’s low. Towards the upside, the resistance levels are pegged at 1,545 pts or the high of 28 Dec, then 1,556.5 pts or the low of 29 Oct.

Source: RHB Securities Research - 30 Dec 2021