The FSSTI index broke below the triangle pattern two weeks ago after consolidating since Oct 18. The outlook of our index remains bearish as it is still trading below the long-term 200-week moving average. The index gapped down this week, violating its previous low support at 2,955. This level will now become the first resistance for any technical rebound if there is any reversal signal. The MACD is bearish and the MACD histogram is strengthening, hinting at more potential downside.
Investors could consider selling on strength when the index approaches the strong resistance zone at 2,955-2,960.
Support: 2,670 / 2,530
Resistance: 2,960 / 3,020
Wong Shueh Ting, CFTe
The index has broken below the 250-week moving average (purple line), and the neckline of a head-and-shoulder (H&S) pattern with a bearish gap. The 20-week (red line) and 50-week (blue line) moving averages are playing resistance roles. The daily RSI has also broken below a H&S pattern and is below its neutrality level at 50%. The MACD is below its signal line and 0-level, while the MACD histogram is broadening. As long as 25,995 (neckline of H&S pattern) holds on the upside, the index is likely to test its nearest key support at 24,540 (2018 low). A break below this level would call for a further drop towards 23,000 (around a long-term bullish trendline formed since 2008).
Investors are recommended to enter for short positions during any technical rebound, using 28,055 (high of right shoulder) to control risk.
Support: 24,540 (2018 low), 23,000
Resistance: 25,955 (neckline of H&S pattern), 28,055 (previous top + high of right shoulder), 29,175 (Jan 20 high)
Joyce Chan, CMT
Based on the weekly chart, the FBMKLCI has continued to form lower highs and lower lows which indicate the downtrend pattern. The bearish index has reacted to the slump in oil prices following reports that OPEC failed to reach a deal with its allies on production cuts. Thus, the FBMKLCI may be vulnerable to negative sentiments. The recent sharp drop on intense selling suggests more weakness in the longer term. However, we expect the index to move in a sideways mode afterwards, based on the ranging market in last week’s movement. We expect a minor bounce from here, but any bounce can be seen as a chance to sell on strength since the FBMKLCI is now in bearish mode territory.
The upside resistance is seen at 1,480 -1,500, where there is strong resistance. We ask investors to approach the market cautiously for now and sell on rebound.
Support: 1,400 / 1,382
Resistance: 1,483 / 1,500
Mohd Fakhrul Asyraq Bin Mohd Aluwi, MSTA, CFTe
Going into March, the JCI is sloping downward significantly, as worries and fears of the COVID-19 outbreak are starting to take its toll with 27 cases appearing in Jakarta. However, as the JCI is now approaching its key support level at 5,500, risk-to-reward ratio is looking quite attractive. That said, we see potential for a mild rebound to take place in the month of March as weekly technical indicator RSI is coming out from its oversold zone. Furthermore, seasonality in March for the past 10 years has shown a positive pattern, with 9x gains and 1x loss. There are other factors that are boosting positive market sentiment, such as Bank Indonesia cutting interest rates by 25bp and the Fed also cutting rates by 50bp. Looking forward, we see immediate support at 5,125 and resistance at 5,765.
Investors should start accumulating, as risk-to-reward ratio is attractive. Focus remains on financial, consumer and property sector indices.
Support: 5,125 / 5,000
Resistance: 5,765 / 5,940
Maskun Ramli, CFTe
The Thai equity market has continued its bearish movement after the SET Index fell below 1,550, which is the key support level, and also dropped beneath 1,400 which is the long-term channel support. This confirms our hypothesis that we are seeing downward movement. Hence, we have to create a strategy based on downward movement bias.
In the last issue, we had recommended that investors consider reducing exposure/positions if the index falls below the 1,480 support, which was the right strategy. It is not easy to catch up to the falling market by predicting the bottom of the movement without seeing a reversal happens. Hence, we advocate waiting for the market to confirm the trading range and the bottoming before making a trade. For aggressive investors, 1,200-1,250 should be considered as a buying zone while the support at 1,200 could be used as a stop level in case the index continues to fall.
Support: 1,250 / 1,200
Resistance: 1,280 / 1,317