Malaysia: Stock Market Found Temporary Support

The Malaysian stock market got a rude awakening this week when the Kuala Lumpur Composite Index (KLCI) went to a low of 888.28 points in the early session but went up later to close near high at 909.51 points. Currently the KLCI is at 911.25 points (12:30pm local, +8:00GMT).

In my previous article, I pointed out the support level for the KLCI between 850 to 900 points and this is still the support level. The Malaysian market is the only market that is able to hold at technical support levels. The support level still holds.

Immediate resistance is at 950 points while a stronger resistance level is at 1,000 points, which is also the short term 30-day moving average. The volatility for KLCI has eased a little. The Average Trru Range (ATR) level for the past 5 days is 20 points. It was 26 points last week.


Daily KLCI chart as at 12.30pm (+8:00GMT) on 22 October 2008 using NextVIEW Advisor. Click on chart to view enlarged chart.

Expect the KLCI to stay in a trading range between these support and resistance levels. The momentum indicators like ADX, RSI and Momentum is still suggesting that the down trend is strong and therefore the KLCI should have a downward bias, therefore the support may be temporary.

Article contributed by Private Trader, Market Expert, Trading Coach and Chief Market Strategist of Nextview, Mr. Benny Lee. For more articles and commentaries from Benny, click HERE.