Careful of Furious Bears! – FKLI 100705

For this week, without hesitation, we will remain our bearish bias towards the market and ready to allow risk averse client to initiate short position if the 1300 level is not able to be maintained for mid to long term trading. Overall market is weak with a lot of technical indicators pointing towards downward pressure.

The important support level of the Bollinger middle band, the MA 100 and the uptrend line seems to be convincingly being taken out. At this level, we are more keen to see whether the 1300 psychological level will be taken out to allow the furious bears to take charge. Failure for this level to being held will trigger a massive selling and major correction is expected to set in.

However, towards the end of the World Cup, market is expected to trade in range between 1295 – 1315 levels for this week. Risk taker investors can continue to initiate short position on strength, however, risk averse investors should only initiate short position if the 1300 level for both the cash and the futures is being taken out convincingly.

[Reminder: US market will be closed tonight in accordance with the celebration of Independence Day.]

-------------------------------------------------------------------------------
The information herein was obtained or derived from the source that we believed are reliable.No liability can be accepted for any loss that may arise from the use of this report.All opinions and estimates included in this report constitutes our judgement as of this date and are subject to change without notice.

Bears Dominated! – FKLI 100702

As per mentioned, breaking the 1320 level will send the FKLI to trade near to the 1300 level and now whether this 1300 level will able to hold or will be taken out as well is our next question to think of.
Failure for the 1300 level to hold will definitely allow the bears to win the battle and further weakness is expected. For cash, the cash need to hold above the current level of 1308 – MA100 or at least hold above the 1300 psychological level, failure for the above two levels to sustain will definitely send the index to trade even lower.

At this moment, we will firmly remain our bearish bias towards the market and those who have shorted the market should hold on to your position. The next level for short that we are looking at is – if the 1300 level is being taken out convincingly.
Support for the day is seen at 1300 – 1295 levels and the resistance is seen at 1310 level.

US MARKET

Further dropping… The US market resumed its downside trading and closed 41 points lower as US manufacturing and home sales indicated slower growth. The US market definitely will be in the weak market momentum so long the index remains below the MA 200 level.
[Reminder: US will release Unemployment Rate (Survey 9.8% Vs Prior 9.7%) and change in nonfarm payroll (Survey –130K Vs Prior 431K  later tonight.]

-------------------------------------------------------------------------------
The information herein was obtained or derived from the source that we believed are reliable.No liability can be accepted for any loss that may arise from the use of this report.All opinions and estimates included in this report constitutes our judgement as of this date and are subject to change without notice.

FKLI New Quarter 1st July

The CI ended down 0.4%, finishing the second quarter of the year 0.5% lower. Meanwhile on the FKLI new month July settle at 1303, 6 points discount against cash. Total volume transacted at 12669 from 16574 the previous day as most of the month end roll complete. Major Southeast Asian stock markets were mixed yesterday, a lackluster second quarter for most, amid concerns over funding conditions for European banks and the pace of the global recovery.
Regional market- Hong kong and Thailand market closed today.

There has been no panic selling in the market yesterday despite the sharp drop in Dow. Meanwhile, we have a bearish view on the fkli as its trading below the major SMA We still wait and see if the FKLI and maintain at the physiological support at 1300. To the upside, the 1325 pt-level is still the immediate resistance while next resistance is seen at the 1350 pt-level. The 1298-1303 pt-level is still the immediate support for the market

US MARKET
U.S. stocks staggered to the end of a dismal second quarter last night in another low volume session as investors found little reason to take on risk after conflicting economic data.   The Dow dropped 96.28 points (-0.98%) The S & P 500 Index slid 10.53 points (-1.01%), to 1,030.71. Nasdaq fell 25.94 points (-1.21%) to 2,109.24. For the second quarter, the Dow fell 10%, the S&P 500 lost 12% and the Nasdaq dropped 12% as worry about Europe's sovereign debt and the sustainability of the U.S. economic recovery caused investors to pull back from the most recent closing highs hit in late April

-------------------------------------------------------------------------------
The information herein was obtained or derived from the source that we believed are reliable.No liability can be accepted for any loss that may arise from the use of this report.All opinions and estimates included in this report constitutes our judgement as of this date and are subject to change without notice.

Bears Attacking! – FKLI 100630

Broke through the 1320 level will send the index to trade all the way down to 1305 – 1300 levels as per mentioned previously. With the overnight tumbled in the Dow, will the cash resume its drop today? In our view, as long as the 1320 level not manage to be regained immediately, the chances for the cash to face with free fall till the 1300 level is very high as the 1320 level is the important psychological support level. With the current level, the index is facing with high downside risk as the Bollinger middle band and the MA 50 & MA 100 levels maybe successfully taken out by the bears.

Next, will this round of drop be a major correction or minor correction? We are in the view that if the 1300 level being taken out convincingly, then the correction will be major as the index will have higher chances to drop below the 1250 level.
Risk taker investors can accumulate short position on strength for mid to long term trading. The support for the day is seen at 1310 – 1305 levels and the resistance is seen at 1325 level.

US MARKET

268 points of sharp dropped suffered by the Dow after the consumer confidence slump and the concern over the growth in China. With the nearly 300 points dropped, the bears are successfully taken over bulls' position and further slide in the index is expected. Technical outlook remained negative with the index trading way below the MA 200 level. The support is seen at 9800 level and the resistance is seen at 10000 level.
[Reminder: US will release Employment Change (Survey 60K Vs Prior 55K) later tonight.]

-------------------------------------------------------------------------------
The information herein was obtained or derived from the source that we believed are reliable.No liability can be accepted for any loss that may arise from the use of this report.All opinions and estimates included in this report constitutes our judgement as of this date and are subject to change without notice.

Resilient… – FKLI 100629

Overall market remained resilient with downside will be well supported towards the end of second quarter, however, market will continue its thin volume trading. For today, 7 points of premium towards the cash will keep the FKLI to havor around this level with immediate resistance is seen at 1335 – 1338 levels and the support is seen at 1328 – 1325 levels.

Overall technical landscape still in positive territory, albeit at the same time also facing with higher downside risk. Thus, investors can remain holding the long position but take opportunity for these two days to take profit and ready to sell into strength after the end of the month.

US MARKET
Another marginal weak market with the index closed lower of 5 points as crude oil prices and metal prices traded lower. Form technical perspective, the general outlook never change – bearish, with the index trading below the MA 200 and the Bollinger middle band. The immediate resistance is seen at 10195 level and the support is seen at 10080 level.
[Reminder: US will release Consumer Confidence (Survey 62.5 Vs Prior 63.3) later tonight.]

 -------------------------------------------------------------------------------
The information herein was obtained or derived from the source that we believed are reliable.No liability can be accepted for any loss that may arise from the use of this report.All opinions and estimates included in this report constitutes our judgement as of this date and are subject to change without notice.

Firmer Week! – FKLI 100628

For this week, as long as the cash can break through the uptrend line, the downward pressure is expected to set in. The immediate important support level shall be seen at 1320 level, failure for this level to be held coupled with the uptrend line being taken out convincingly, the correction will confirm its appearance. In contrast, as long as the 1320 level manages to sustain, the index has higher chances to reach the 1350 level for the last round, at least until the end of this month.

Not much to expect for this week as well with the market expected to trade slightly higher with thin volume. Although the overall technical landscape looks weak and face with higher downside risk, we are in the view that the window dressing will set in for these few days and the index will only start to experience major correction end of the week or beginning of next week. The support for the week is seen at 1320 – 1310 levels and the resistance is seen at 1338 – 1345 levels.

For today, sideway trading with slight upside bias is expected with the immediate support is seen at the 1320 level. Intraday investors can still accumulate a small long position if the FKLI trades near to the 1320 level with stop loss between 5 – 7 points from the 1320 level. We remain our view that the current trading level will not be a level to initiate short position yet.


-------------------------------------------------------------------------------
The information herein was obtained or derived from the source that we believed are reliable.No liability can be accepted for any loss that may arise from the use of this report.All opinions and estimates included in this report constitutes our judgement as of this date and are subject to change without notice.

Fight between Bulls and Bears! – FKLI 100624

5 points higher after the pre-matching phase for the cash, pushing the FBMKLCI to close in positive territory on late bargain hunting and exclude our market from following the black closing in other regional and Europe markets. As per mentioned, at current level, the uptrend will remain intact albeit at a slower pace with the immediate tough resistance at the previous high of 1352 (futures) and 1350 (cash).

At this level, we will still remain our neutral view towards the market and will closely monitor the uptrend channel that build recently after the major correction. We will only revise our neutral call to bullish call for the cash if the previous high of 1350 is being taken out convincingly or from neutral to bearish call if the 1303 – 1300 levels being taken out convincingly.

The cash and futures may havor around the 1320 – 1345 levels for the coming week until the end of the second quarter. We are expecting some window dressing as well towards the end of second quarter. Thus, this is not a level that we will encourage investor to start accumulate selling position. Those who prefer holding long position can do so if the market trading near to the 1320 level but remembers to keep stop loss near to the 1315 level. Support for the day is seen at 1325 levels and the resistance is seen at 1335 – 1340 levels.

US MARKET

Overnight US market closed unchanged with the index being added 4 points only as the purchases of US new home sales fell. The index remains below the MA 200 level (10350) and this level need to be taken out as soon as possible to allow the uptrend in the US market to resume. As long as the index stuck below the MA 200 level, we will remain our bearish bias towards the market. The market is expected slow for tonight ahead of the GDP due to be announced tomorrow night. The support is seen at 10200 level and the resistance level will be at the MA 200 level.
[Reminder: US will release its Initial Jobless Claim (Survey 463K Vs Prior472K) later tonight.]

-------------------------------------------------------------------------------
The information herein was obtained or derived from the source that we believed are reliable.No liability can be accepted for any loss that may arise from the use of this report.All opinions and estimates included in this report constitutes our judgement as of this date and are subject to change without notice.

Temporary or Long Term Downside Trading? – FKLI 100623

7 points of premium towards the cash will send the FKLI to trade even lower for today after overnight triple digit losses suffered by the DJIA. Overnight tumbled in DJIA sending a weak signal ahead if the index still not manages to rebound above the MA 200 level for the coming few days.

Although at this moment, we will not change our neutral call to bearish call yet in view that our own technical still in place, however, we are still in the opinion that the FKLI will need to cover the gap of 1330 – 1320 before any further uptrend can be set in.

For mid to long term, we remain our bearish bias towards the market and for near term market, we will remain our neutral point of view until the uptrend channel being taken out. The support is seen at 1320 – 1315 levels and the resistance is seen at 1335 – 1340 levels.

US MARKET

Overnight US market skidded nearly 150 points after the home sales data unexpectedly dropped and closed at 10293 level. From technical point of view, the dropped is sending the DJIA to trade below the important support level of MA 200 level. Failure for the DJIA to regain above this level for the coming few days will indicate the bears will re-control the situation.
The next important support level will be the Bollinger middle band 10175 level and the resistance now will be at the MA 200 level.
[Reminder: US will release its New Home Sales (Survey 410K Vs Prior 504K) later tonight.]


-------------------------------------------------------------------------------
The information herein was obtained or derived from the source that we believed are reliable.No liability can be accepted for any loss that may arise from the use of this report.All opinions and estimates included in this report constitutes our judgement as of this date and are subject to change without notice.

Expected Pull Back… – FKLI 100622

We are expecting a pull back for our market as yesterday surged will be taken as overdone and overnight slight declined in the DJIA will also send the FKLI to trade lower for today. Besides, the 6 points premium gained yesterday by the FKLI may need to give back for today.

Yesterday gap opening will indicate the FKLI needs to tumble to close the gap before any further uptrend is expected. At current level, we are in the opinion that the market is not a clear market for investors to initiate a short position although we perceive the 1350 level is a strong resistance level for the cash market.

We will maintain our neutral view towards the near term market and maintain our bearish bias towards the mid to long term market. The support is seen at 1330 – 1325 levels and the resistance is seen at 1350 level.

US MARKET

The immediate tough resistance is seen at 10780 level, the highest level set on 14th May before the sharp dropped set in. Breaking through this level will only send a clear signal on the uptrend, failure for this level to be taken out will indicate the near term market may fall into further consolidation phase. The support is seen at 10340 level – MA 200, which is also a very important support level.
[Reminder: US will release its Existing Home Sales (Survey 6.12M Vs Prior 5.77M) later tonight.]


-------------------------------------------------------------------------------
The information herein was obtained or derived from the source that we believed are reliable.No liability can be accepted for any loss that may arise from the use of this report.All opinions and estimates included in this report constitutes our judgement as of this date and are subject to change without notice.

Do Bears Need to Give Way? – FKLI 100519

Just a quick recap of what had happened last week, especially last Friday. The band for the cash that we had been tracking thus far (1303 – 1308) has been successfully being taken out on the eleventh-hour and the cash closed even 5 points higher after the pre-matching phase. This broke through will indicate the short-term bullishness of the market as per mentioned previously.

The next question that most of us will ask is "Whether this upside trading will continue for the time being?" In our opinion, the chances are higher although the cash has been unsuccessfully taken out the 1350 level after three attempts. However, with the help of the world market, at the moment, the FBMKLCI is expected to resume its slight uptrend with the immediate resistance only seen at 1330 level albeit at a slower pace after recent two consecutive weeks of upside trading.

For short term, we will temporary change our bearish call to neutral until the end of the month but we will maintain our bearish call towards the mid to long-term call on the market. We perceive this round of rebound as technical rebound and the chances for it to break through the 1350 level are slim. Investors can take a quick and temporary long position and look to take profit above the 1330 level. This will not be a good level to initiate short position in view of the current unstoppable uptrend.
For today, the support is seen at 1315 – 1310 levels and the resistance is seen at 1325 – 1328 levels.


-------------------------------------------------------------------------------
The information herein was obtained or derived from the source that we believed are reliable.No liability can be accepted for any loss that may arise from the use of this report.All opinions and estimates included in this report constitutes our judgement as of this date and are subject to change without notice.

Take a Rest! – FKLI 100618

Yesterday, last hour short covering pushed the futures to close 9 points premium to cash will more or less put some pressure to the FKLI for today. Our market is still not a clear uptrend with the cash remains confine in the band of 1303 – 1308 levels. Successfully breaking the 1308 level will indicate the cash will at least reach 1320 level. Failure for this level to be taken out convincingly will trigger selling pressure in the market.

In our opinion, the FKLI will gradually move towards the 1320 level till the end of the month before any major correction will set in. Historically, stepping into the third quarter will be a slow quarter and investors will take this opportunity to liquidate their position after the end of this month.
For today, not much to expect as well as it will still be a lackluster trading day with the support is seen at 1305 level and the resistance is seen at 1315 – 1318 levels.

US MARKET
Overnight US market closed marginally higher of 24 points mainly contributed by rally in technology shares. Overall technical landscape remains unchanged with the immediate support is seen at the MA 200 level – 10330 and the resistance is seen at MA 100 level – 10540.


-------------------------------------------------------------------------------
The information herein was obtained or derived from the source that we believed are reliable.No liability can be accepted for any loss that may arise from the use of this report.All opinions and estimates included in this report constitutes our judgement as of this date and are subject to change without notice.

Quite Session Expected! – FKLI 100617

Yesterday, the cash retreated almost 10 points from its day high, closed at the day low and just closed within the band that we are looking at thus far. Like what we mentioned yesterday, the chances for the cash to break through the tough band is high but not necessary. The inability to sustain above the band that we are looking at, indicating the uptrend building is not confirmed.

For today, since overnight DJIA unchanged, we are expecting our FKLI market will be havoring within a very tight trading band with slight downside bias. For today, the support is seen at 1305 – 1300 levels and the resistance is seen at 1312 – 1315 levels.

US MARKET
Overnight US market closed marginally higher of 4 points as greenback strengthen against the euro and the housing starts data showed declined result. The DJIA currently is only marginally above the important support level of MA 200 – 10325. The DJIA will need to hold on to this support level to allow the index to resume its uptrend. Failure for the DJIA to hold above this level will send the US market to resume its downside trading.
[Reminder: US will release its CPI (Survey –0.2% Vs Prior -0.1%), Initial Jobless Claim (Survey 450K Vs Prior 456K) and Leading Indicator (Survey 0.4% Vs Prior 0.1%) later tonight.]

-------------------------------------------------------------------------------
The information herein was obtained or derived from the source that we believed are reliable.No liability can be accepted for any loss that may arise from the use of this report.All opinions and estimates included in this report constitutes our judgement as of this date and are subject to change without notice.

Cash to Break 1307 level? – FKLI 100616

Sudden slump down in the morning session triggered by stop till the low of 1269.5 point was proving that the illiquidity suffered in the market with the world cup taking the stage and in accordance with school holiday in Malaysia. A lot of the investors will start to ask whether our FKLI will retreat to that level again in the near future as this is normally happened previously. In our opinion, we will stick to our view -- if the FBMKLCI (cash) successfully taken out the 1303 – 1308 levels, short term traders should shift their trading strategy to temporary long.

Whether today the cash will successfully break through the above levels after overnight US market surged more than 200 points and even regained its posture above the MA 200 level? No one will know, we can just say, "chances are higher but not necessary". Risk averse investors should ready to cut if the above levels are being taken out convincingly.

For today, the support is seen at 1290 level and the resistance is seen at 1305 – 1310 levels.

US MARKET
Overnight DJIA just successfully broke through the MA 200, recovering from its correction phase. As long as the DJIA manages to sustain above this level tonight, the upwards trading is expected for the near term.
Yesterday, US market surged more than 200 points, +2.1% after the manufacturing gave the signal of the world economy recovering is expected to resume. The support is seen at 10320 level and the resistance is seen at 10500 level.
[Reminder:
1)      China, Hong Kong and Taiwan market will be closed for today in accordance with Dragon Boat and Tuen Ng Day celebration.
2)      US will release its PPI (Survey –0.5% Vs Prior -0.1%) and Housing Starts (Survey 648K Vs Prior 672K) later tonight.]

-------------------------------------------------------------------------------
The information herein was obtained or derived from the source that we believed are reliable.No liability can be accepted for any loss that may arise from the use of this report.All opinions and estimates included in this report constitutes our judgement as of this date and are subject to change without notice.

World Cup Fever! – FKLI 100615

Nothing much to mention with the current quite and calm markets that we are experiencing now, world cup fever superseded the financial market fever! Market without volatility is hard to trade, investors can only profit from the range trading.
For mid to long term trading, we will maintain our bearish call for futures so long as the 1303 of the cash market is not being taken out. The support for the day is seen at 1295 level and the resistance is seen at 1308 – 1310 levels.

US MARKET

Overnight US market gave back all the profit gained in the early session and closed in the negative territory after Greece being downgraded by Moody to non-investment grade (junk bond) and the inability to breakthrough the MA 200 important overhead resistance level.
Overall technical remain weak so long the MA 200 level is not being taken out convincingly. The support is seen at 10100 level and the resistance is seen at 10315 level.

[Reminder:
1) China market will close today in accordance with the celebration of Dragon Boat Day. 2) US will release its NAHB Housing Market Index (Survey 21 Vs Prior 22) later tonight.]

 -------------------------------------------------------------------------------
The information herein was obtained or derived from the source that we believed are reliable.No liability can be accepted for any loss that may arise from the use of this report.All opinions and estimates included in this report constitutes our judgement as of this date and are subject to change without notice.

Lackluster Week Ahead… – FKLI 100614

For this week, we are expecting the market to trade sideway in accordance with school holiday and the start of world cup. No major upside or downside movement is expected, at least for this week.

Technically, both the indices (futures and cash) will need to convincingly break through the 1303 level (MA 100) to return to positive trading, failure for this level to be taken out convincingly, the indices will be defended strongly by the bears.

We will temporary maintain our bearish bias towards the market and remain that investors who have shorted the futures should exercise stop loss if the cash manages to break through the 1303 level convincingly. Although this round of uptrend (if the 1303 is being taken out convincingly) will be mild, targeted the most will be reaching the 1320 level only, those who are risk averse should not take this kind of risk and should only re-initiate short position if the 1320 level achieved.

On the other hand, for US market, the DJIA needs to regain its posture above the MA 200 level to resume its uptrend, failure for this level to be taken out, the US market will remain in negative territory. In our opinion, the US market will have some mild technical rebound for this week with immediate resistance is seen at the MA 200 level – 10315.

[Reminder: Australia and China's market is closed for today in accordance with the celebration of Queen's Birthday and Dragon Boat Day.]


-------------------------------------------------------------------------------
The information herein was obtained or derived from the source that we believed are reliable.No liability can be accepted for any loss that may arise from the use of this report.All opinions and estimates included in this report constitutes our judgement as of this date and are subject to change without notice.

Is Bull Back? – FKLI 100611

To answer the above question, is still early at this stage, but to us, at least not at the moment and the uptrend will be capped for now. Reasons as below:-
1)      Overall technical indicators remain weak at the moment with the US index still trading below the Bollinger middle band and the MA 200 level.
2)      The second quarter is about the end and historically third quarter is a slow and slightly weak market.
3)      World still clouded with negative fundamentals, especially the news on SEC is probing a second Goldman Sachs CDO in addition to the Abacus transaction.
4)      The start of World Cup.

We are expecting the FKLI to open higher and today's surge will also give the chance for the cash to close the gap set on 21st May 2010 (Please refer to yesterday report for more detail).

If the market is convincingly breaking through the 1303 level and able to sustain above this level, then for these 1 – 2 weeks, the bears may need to temporary give way for the bulls, failure for this level to be taken out will result in bears relaxing in handling this battle.
So what shall the investors do? For those who have initiated short position, you can still hold on to your short position and look at how the market perform for today first, but if your risk tolerance level is lower, do initiate stop loss above the 1303 level.
For today, the support is seen at 1285 level and the resistance is seen at 1303 – 1305 levels.

US MARKET
Overnight US market regained its posture above the 10,000 level with gains of 273 points, +2.76% on better commodities prices, gained in euro and economic data showed the accelerating growth. The index currently remain below the Bollinger middle band and the MA 200, failure for these two levels being taken out convincingly will result in the DJIA remains in negative territory.
[Reminder: US will release its Retail Sales (Survey 0.2% Vs Prior 0.4%) later tonight.]

 -------------------------------------------------------------------------------
The information herein was obtained or derived from the source that we believed are reliable.No liability can be accepted for any loss that may arise from the use of this report.All opinions and estimates included in this report constitutes our judgement as of this date and are subject to change without notice.

Ahead of 10th Malaysia Plan – FKLI 100610

Morning session will be a slow session ahead of our PM's release of 10th Malaysia Plan and the market may experience some minor sell off near the end of the first session. The overall technical landscape does not change at the moment and still bias towards downside with thin volume expected throughout these two weeks.

In our view, the cash may slowly climb higher and close the gap set on 21st of May before it resumes its downside trading (please refer to the graph). No matter what, the cash overall technical landscape is similar to futures and downside trading is expected as well.
We will remain our bearish bias towards the market and hold to our call of Selling into Strength. Any level near to the 1300 level should remain as a good selling level. The support for the day is seen at 1280 – 1275 levels and the resistance is seen at 1293 – 1295 levels.

US MARKET
Overnight US market dropped more than 40 points as concern on BP's dividend cut to pay for the oil spill at the Gulf of Mexico. The overall technical indicators remain weak with the index trading below the important MA 200 level. We are in the view that the index has been stuck in this low level for quite some time, reducing the hope for the index to rebound above the MA 200 level in the near term.
[Reminder: US will release its Initial Jobless Claim (Survey 450K Vs Prior 453K) later tonight.]


-------------------------------------------------------------------------------
The information herein was obtained or derived from the source that we believed are reliable.No liability can be accepted for any loss that may arise from the use of this report.All opinions and estimates included in this report constitutes our judgement as of this date and are subject to change without notice.

Chances to Short… – FKLI 100609

Today, the FKLI will move very near to the 1300 level in tandem with overnight surged in DJIA and the expected announcement of the 10th Malaysia Plan tomorrow, this will give a good opportunity for investor to initiate short position in tandem with our short call initiated for the week. Monday itself did not give much an opportunity to investors to initiate their short position as the gap opening was discounted too large a level from what we are looking at – short near to the 1300 level.

We are firmly remained our downside bias call towards the market with the immediate support seen at MA 200 level – 1271. FKLI currently still maintain below the Bollinger middle band (please refer to the graph attached), indicating the bearishness of the market not yet come to an end.
For today, the support is seen at 1280 – 1276 levels and the resistance is seen at 1288, followed by 1293 level.

US MARKET

Overnight US stock market traded higher in accordance with the stronger commodities prices. Technically, the overall landscape did not change much as the index still trading way below the MA 200 level. We remain our bearish bias towards the market and reminded the investors that the World Cup will start this Friday, which is only another 2 days to go.
[Reminder: US will release its CPI (Survey 0.1% Vs Prior 0.1%) later tonight.]

-------------------------------------------------------------------------------
The information herein was obtained or derived from the source that we believed are reliable.No liability can be accepted for any loss that may arise from the use of this report.All opinions and estimates included in this report constitutes our judgement as of this date and are subject to change without notice.

Bears Seem Very Relax! – FKLI 100608

FKLI Market Outlook:

A lot of investors started to believe that our market seem to re-enjoy the decoupling that we used to enjoy about a month ago as yesterday market rebounded from its day low of 1272, same went to cash as the FBMKLCI closed 8 points higher from its day low.

However, in our view, our market will only have mild support and will not have what we have before – decoupling from the world financial market. The mild support comes from the expectation of the announcement on the 10th Malaysia Plan two days after. To us, this is a very small piece of fundamental news and will not have much impact towards our market in this current strong world influences environment. We will strongly advise investors not to hold long position overnight, provided it reaches certain important and strong support.

We are firmly bias towards the downside in accordance with the technical and fundamental reasons stated in our weekly report yesterday. Overnight further dropped in the DJIA was pushing the index further below the MA 200 level, indicating the CONFIRMED bears market ahead.

We are not expecting the world bourses to recover within this week ahead of the start of the World Cup. Market will remain towards downside with thin trading volume. For today, the support is seen at 1270 – 1265 levels. Slightly stronger support only is seen at 1252 level. Investors need to be more cautious (especially those holding the long position) if the FKLI is not able to support above the MA 200 level – 1271. This round of break below this level will confirm the MA 200 being convincingly breakthrough and further major correction is expected.

US MARKET
Overnight US market closed another triple digit losses, resumed its downside momentum. From technical points of view, yesterday dropped is sending the DJIA further below the MA 200, more unlikely to regain its posture above the MA 200, strongly indicating the confirm bearish market for mid to long term. (Please refer to the page 2 on the attached report for the chart).


-------------------------------------------------------------------------------
The information herein was obtained or derived from the source that we believed are reliable.No liability can be accepted for any loss that may arise from the use of this report.All opinions and estimates included in this report constitutes our judgement as of this date and are subject to change without notice.

FKLI Bull is back? Or Bear Trap?

FKLI June futures contracts closed strong at closed yesterday in line with the higher cash and regional market. Spot month June gain 20.5 while July +19.5 points. Premium widen to 6 pts from 3 pts previous day. 

On the cash market, KLCI jumped 18.42, 1.44% across-the-board gains. The uptrend was largely due to the overnight gain in the US market, which received a boost from better housing and car sales. In addition, the strong regional market (STI +2.42%, N225 +3.25% and Kospi +1.93%) provides the much needed optimism. 

Among the top gainer sector is plantation +74.72, 1.41% and finance +152.91, and 1.41%.  Nevertheless, the volume traded not so convincing before any trend could be confirmed at this juncture.
 
Technically, the fkli managed to penetrate the psychological 1300 resistance level. Closing above the psychological 1300 level resistance, and with both FKLI and KLCI closed above the 200SMA could be one signal that the recent minor correction is over.  In another positive sign, the fkli MACD turned positive after turning bearish in mid-May. If the cash mange and stay above the 1300 player possibly will start feeling confident that the cash has bottomed out.  Fkli are set a cautious open today after US market offer little direction and fkli may open lower as basis will narrow unless the cash climb above the 1300 level. The next resistance level for cash will be psychological resistance and 1305 for fkli. Immediate support revise higher to 1290-1285 while resistance at 1310.
 US Market

U.S. stocks rose last night, led by a late-day surge in technology shares as investors geared up for a strong unemployment report today. Volume was light ahead of Friday's non-farm payrolls report, which is expected to show the economy added 513,000 jobs in May. The Dow Jones up 5.74 points, or 0.06%, to end at 10,255.28. The Nasdaq rose 21.96 points, or 0.96%, to 2,303.03  
-------------------------------------------------------------------------------
The information herein was obtained or derived from the source that we believed are reliable.No liability can be accepted for any loss that may arise from the use of this report.All opinions and estimates included in this report constitutes our judgement as of this date and are subject to change without notice.