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Composite Index Weekly Technical
Analysis, 27/05/2005
Main Chart:
On Wednesday, 25th May 2005, KLCI had the biggest lost of 14.24 points in the year of 2005 so far; followed by Thursday, KLCI made a year low of 2005 at 859.8 points, which was also the support level from this year’s previous yearly low of 859.81 points, and rebounded strongly. Therefore, S1 support line is the present support for KLCI where as the 878.95 points WinChart Automatic Fibonacci Retracement as well as R1 line will serve as the resistances for KLCI. For the week, KLCI gave up 14.06 points or 1.6%, closing the week at 869.11 points. (Refer to A)
Bollinger
Bands:
With the exception of Wednesday’s trading where the 10 days Bollinger Band opened 29%, the opening of the Bollinger Band width for the rest of the trading days were rather insignificant. However, since KLCI is now situated below the middle band, we could face the risk of more downside movement as soon as Bollinger Band width re-opens again.
Volume:
Due to the closure of Bursa Malaysia on Monday for the replacement of a public holiday, we saw the total market volume traded on Bursa Malaysia retreated 6.3%. Total market volume for the week stood at 15,539,140 lots. (Refer to B)
MACD:
As shown in C, MACD histogram is showing an unconfirmed sign of possible “round bottom” thus suggesting a temporary technical rebound for KLCI. Of course, this signal is not confirmed yet, but it pays to monitor the MACD histogram. However, since the MACD line is now below the zero level, overall market sentiment remained weak.
WinChart RSI:
With the falling of Wednesday and Thursday’s trading, WinChart RSI unquestionably fell below the 30% level, entered the mid-term bearish zone. Although we saw KLCI had a technical rebound on the later part of the week, RSI was unable to break away from the bearish zone. Until we see WinChart RSI successfully breached above the 30% level, KLCI out look is still bearish. (Refer to D)
Stochastic:
The sensitive Stochastic were already in the short-term bearish zone in the beginning of the week. Together with the technical rebound of KLCI, stochastic is now standing quite close to the 30% level. If Stochastic managed to break above the 30% level, short-term sentiment of KLCI will turn to neutral. (Refer to E)
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