The FTSE Bursa Malaysia KLCI (FBM KLCI) is expected to rebound next week, as market leads return and anchor investors come back after the long Chinese New Year break, alongside a positive external sentiment.

Affin Investment Bank Head of Retail Research Dr Nazri Khan said trading volume is expected to pick up next week, with immediate support remaining at 1,600 and 1,610, while immediate resistance for rally hurdles should stand at 1,640 and 1,650 (where 20 and 50-day moving average converge).

"The FTSE Bursa Malaysia KLCI (FBM KLCI) could be forming a bullish inverted "head and shoulders" pattern, having already tested the 1,600 level previously on Jan 22 and Feb 7," he said.

A head and shoulder pattern, believed to be one of the most reliable trend-reversal patterns, is a movement of indices that peaks three times over a period of time, but at different levels.

The second peak is higher than the other two, performing a shape like a human head and shoulders.

On global development, he said Japan's reaffirmed commitment to a massive liquidity programme, a 100 trillion yen asset purchase programme, and retaining interest rates unchanged would be the biggest catalyst to support market sentiment.

"We believe the Japanese expansive policies will flood liquidity, drive down the value of the yen and indirectly boost Asian regional markets," he added.

He said other factors that may support the local market was the outcome of the Group of Twenty (G20) Finance Ministers and Central Bank Governors meeting in Moscow this weekend.

He said the weak data from G20 members' economy, a contraction by 0.6 per cent in the European Union's gross domestic product (GDP) and Japan's real GDP shrinking at an annualized rate of 0.4 per cent in the October-December quarter from the preceding three months, is expected to be the focus driver for the meeting.

"Their main agenda, which is to reduce forex volatility and produce a more coherent international economic policy to weather the financial crisis, should be receptive to the equity market," he added.

Meanwhile, for the week-just ended, the FBM KLCI was mostly rangebound due to lack of follow-through buying after a promising start on Wednesday.

The market was closed on Monday and Tuesday for Chinese New Year.

On a week-to-week basis, the FBM KLCI was up 4.13 points to 1,627.93 from 1,623.8 last Friday.

The Finance Index fell 12.3 points to 14,932.34, while the Industrial Index added 12.42 points to 2,793.64, and the Plantation Index jumped 70.3 points to 7,968.96.

The FBM Emas Index garnered 49.37 points to 11,069.03, the FBMT100 Index advanced 41.46 points to 10,919.54, the FBM70 Index surged 108.72 points to 12,032.8 and the FBM Ace Index increased 38.21 points to 4,070.94.

Weekly turnover declined to 2.18 billion units worth RM3.73 billion from last week's 4.902 billion units worth RM8.048 billion.

The Main Market volume fell to 1.82 billion shares valued at RM3.68 billion from 3.938 billion shares valued at RM7.937 billion previously.

The Ace market volume decreased to 320.62 million shares worth RM34.53 million from 794.924 million units worth RM104.286 million.

Warrants was down to 70.55 million units valued at RM3.88 million from 161.560 million units valued at RM9.043 million. -- BERNAMA