For this week, provided the FKLI can successfully break through the band of 1320 – 1350 levels, if not, the FKLI will still being trapped in the range trading of these 30 points. From technical point of view, the immediate support for the cash is at 1338 level (Bollinger middle band), followed by 1328 (MA 50) while the FKLI immediate support is at 1336 (Bollinger middle band), followed by 1328 (MA 50) as well.
We will remain our positive bias towards the current market for this week and for those who have initiated the short position (as per our call on last Thursday) near to the 1350 level should take profit on any retracement these few days, especially if the FKLI unable to successfully break through the 1328 level. This is in line with what we planned - to only take marginal profit on this round of short position.
Currently, the 1328 level should serve as a good support for both the FKLI and cash, thus, investors can initiate long position if the market trades near to/ below this level. For this week, the trading strategy will be to accumulate long position on any downward pressure, especially any level below the 1325 and set the stop loss within the 1320 – 1316 levels.
For today, the FKLI may open marginally lower in accordance with last Friday triple digit lost, however, the gap is expected not sharp in view of the recent strong buying interest. The support for today is seen at 1335 – 1330 levels and the resistance is seen at 1340 – 1343 levels.
[Reminder: US will release its NAHB Housing Market Index (Survey 20 Vs 19) later tonight.]
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