Bursa Malaysia headed south again – one day after ending the six-day losing streak in which it had stumbled more than 35 points or 2.3 percent. The Kuala Lumpur Composite Index now sits just above the 1,600-point plateau and it's tipped to open in the red again on Friday.
RHB Investment Bank Bhd (RHB Research) has advised maintaining short positions on the FKLI as it extended its decline on Wednesday, closing down by 11.50 points at 1,603.50 points and hovering near the crucial 1,600-point support level. The session opened at 1,616.50 points, reaching a high of 1,619.50 before retracing to a low of 1,601.50, closing with a significant bearish candlestick.
The ongoing negative price action, combined with a downward-trending RSI, signals intensifying bearish momentum. In the coming sessions, the FKLI may push below the immediate 1,600-point support, which would likely trigger fresh selling pressure, potentially drawing the index down towards the 1,550-point level.
Adding to this downward outlook, the 50-day simple moving average (SMA) is curving downward, reinforcing downside pressure on the index.
With no bullish reversal signals at present, RHB Research advises holding a negative trading stance. Traders are recommended to stay in their short positions, initially opened at 1,627.50 on 4 October, and manage risks with a stop-loss level set at 1,657 points.
Immediate support remains at 1,600 points, followed by 1,550, while resistance levels are expected at 1,630 and 1,657 points.
On the other hand, RHB Research suggests maintaining long positions on the FCPO, which surged past the RM4,650 resistance level on Wednesday to close at RM4,696, marking its strongest close in two years. The commodity opened at RM4,628, rebounding from a low of RM4,592 and reaching a session high of RM4,702 before closing strong.
This recent breakout underlines the continued bullish control, with the FCPO likely aiming to extend its upward momentum towards the RM4,800 resistance. Both the 50-day and 200-day SMAs are trending upwards, offering structural support to the bullish setup.
However, should profit-taking occur, the FCPO could pull back to test the RM4,500 support level. Given the ongoing bullish technical indicators, RHB Research advises holding a positive trading bias.
Traders are encouraged to retain long positions, which were initiated at RM3,947 on 20 September, while managing downside risk with a trailing-stop threshold of RM4,400. Key support has been revised to RM4,500, with additional support at RM4,400, while the immediate resistance is at RM4,800, followed by RM5,000.
