Thursday 28 Mar 2024
By
main news image

KUALA LUMPUR (Nov 26): The FBM KLCI is in a position to test a higher level today, albeit with limited gains, suppoted by window-dressing activity.

The U.S. dollar gained and the euro briefly hit a seven-month low on Wednesday in a volatile session on views the European Central Bank will ease monetary policy further, including buying more debt and charging banks for hoarding cash, according to Reuters.

The greenback touched an eight-month high against a basket of currencies as the latest batch of U.S. economic data continued to support a Federal Reserve interest rate increase in December, it said.

AllianceDBS Research in ite evening edition Wednesday said that dampened by the weak up close in the preceding day, the FBM KLCI had on Nov 25 traded marginally lower to 1,671.58 as some market participants chose to play on the selling side in anticipation of a lower market.

However, it said non-follow through selling pressure in the area of 1,671.58 prompted renewed buying interest which lifted the benchmark index to 1,684.77 before settling near the day’s high 1,684.42 (up 7.39 points or 0.44%).

“In the broader market, losers outnumbered gainers with 669 stocks ending lower and 268 stocks finishing higher. That gave a market breadth of 0.40 indicating the bears were in control,” it said.

AllianceDBS Research said the lower low on Nov 25 was expected given the previous day’s weak up close.

“However, the rebound from the low to close near the day’s high on Nov 25 indicated the presence of supportive buying interest.

“The ability of the benchmark index to gain its positive momentum into the 1,680 zone is because the day’s low of 1,671.58 where the last seller sold its stock position happened to be a level where there was more willing buying demand than selling supply.

“The buying activity we witnessed on Nov 25 is believed to be based on the marker reality of the higher buying volume that took place in the market between Nov 19 and Nov 23,” it said.

The research house said following the up close, the FBM KLCI is expected to test higher with support zone between 1,669 and 1,671.

It said the immediate hurdle was at 1,687, adding that a crossover of 1,687 should thus see the benchmark index moving towards the next subsequent resistance zone, 1,695 – 1,700.

The research house said that indicator wise, the MACD was marginally above the 9-day moving average line.

“The analysis of overall market action on Nov 25 revealed that buying power was stronger than selling pressure.

“As such, the FBM KLCI is likely to trade above the 1,684.77 level on Nov 26,” said AllianceDBS Research.

      Print
      Text Size
      Share