HSI, STI & KLCI Monthly Charts

STI Monthly Chart

The FSSTI index is in a downtrend as it is trading far
below the cloud. A bearish conversion and base lines
crossover have confirmed this bearish trend as well.
However, a corrective rebound had been expected, and
we have seen that materialising after the index
rebounded from the low formed in Mar 20, which is also
near its long-term rising trendline that started in 1998. It
is now testing its gap resistance at 2,634. The index has
to penetrate above 2,634 for further rally, but the upside
could be limited as there is an overhead base line
resistance at 2,746. A violation of 2,520 could result in a
test of the low again.
Investors could accumulate when the index penetrates
above the gap resistance at 2,634, and sell on rally when
the index approaches the base line resistance.
Support: 2,525 / 2,380
Resistance: 2,670 / 2,745
Wong Shueh Ting, CFTe

Based on the weekly candlestick analysis, a spinning top
pattern was spotted on the chart that indicates indecisive
movement from hereon. However, the FBMKLCI
movement was still in the range of the immediate support
and resistance levels of 1,320 and 1,430 in the last few
weeks. The recent sharp drop on intense selling
suggests more weakness in the longer term. We expect
a minor bounce from here, but any bounce can be seen
as a chance to sell on strength since the FBMKLCI still in
the bearish mode territory as the index is still below the
Ichimoku cloud.
Due to the potential consolidation ahead, investors and
position traders may wish to remain on the sidelines and
wait for confirmation. If a new higher high is formed,
investors may go long, but if the bullish trend is broken,
investors may turn short.
Support: 1,320 / 1,300
Resistance: 1,430 / 1,460
Mohd Fakhrul Asyraq Bin Mohd Aluwi, MSTA, CFTe

After the index rebounded from the long-term bullish
trendline (formed since 2008), it has been ranging for few
weeks between 23,484 (overlapped level since Mar 20) and
horizontal resistance at 25,134 (overlapped level since 2018
and around 50% Fibonacci retracement level between Jan
20’s top and Mar 20’s low). The weekly indicators are mixed.
The 20-week (red line) moving average is below the 50-week
(blue line) one and is heading downwards. The daily RSI
lacks momentum. However, the weekly MACD is turning up,
while the MACD histogram is narrowing.
Hence, we are neutral on the index now and expect it to
continue ranging between long-term bullish trendline (formed
since 2008; around 22,700) and next key resistance around
25,134. In addition, the 250-week (purple line) moving
average is also playing a very important resistance role on
the upside. Alternatively, only a break below the long-term
bullish trendline would turn the outlook to negative.
Investors are recommended to accumulate stocks during any
consolidation and can use the long-term bullish trendline
(around 22,700) to control risk.
Support: 23,484 (overlapped level since Mar 20), bullish
trendline since 2008 (around 22,700), 21,139 (previous
Resistance: 25,134 (horizontal key resistance since
2018), 25,668 (250-week moving average; purple line),
26,533 (50-week moving average).
Joyce Chan, CMT

Monthly Regional Indices View

The FSSTI index continues to move within the triangle
pattern, which is a sign of consolidation. It is now trading
at the lower trendline support, which is acting as the first
layer of support. The index gapped down two weeks ago,
creating a price resistance at 3240. Generally, the
outlook of the index is bearish as it is trading below the
200-week moving average, and the MACD momentum
indicator has turned bearish with both of the MACD lines
below the zero line. The RSI is trading near the oversold
region, which could raise the odds for a potential short
term rebound to test the gap resistance. A break of the
lower trendline support of 3,110 would accelerate the
downward momentum and hint at further downside at

Investors could use the lower trendline support as a
guideline. Once the index breaks below the trendline,
investors could reduce their positions.

Support: 3,110 /2,955
Resistance: 3,285 / 3,400
Wong Shueh Ting, CFTe

The index has rebounded near its 250-week (purple line)
moving average and has broken above the 20-week (red
line) moving average. The weekly RSI is supported by a
bullish trendline and has just broken above its neutrality
level at 50%. The MACD is above its signal line and 0-
level. However, the index is still capped by two bearish
trendlines since 2018 (red and dark-blue lines).
Therefore, we expect the index to range between the
previous high (29,175) and the 250-week (purple line)
moving average.
As long as the 250-week moving average (around
25,772) is not broken, the index is likely to challenge
29,175 (previous top) again. A break above 29,175
would call for a further advance towards 30,280.
Alternatively, only a downward breakout below the 250-
week moving average would call for a further drop
towards 24,540 (2018 low).

Investors are recommended to continue to accumulate
stocks and use the 250-week MA (around 25,772) to
control risk.

Support: 25,772 (250-week MA), 24,540 (2018 low)
Resistance: 29,175 (previous top), 30,280 (Apr 19 high)
Joyce Chan, CMT

Based on the weekly chart, the FMBKLCI continued to
form a series of lower highs and lower lows which show
the continuation of a downtrend pattern. A selling signal
has been given as the index is still trading below the
Ichimoku cloud. This is supported by the Heat Wave
indicators as the Tenkan-sen, Kinjun-sen and Chikao
span lines inter-cross, which suggests a bearish signal.
Given the lack of domestic catalysts, external factors
may have more weightage. Thus, the FBMKLCI may be
vulnerable to negative sentiments regionally. In the near
term, we expect the index to continue on the downside if
it drops and penetrate the psychological support level of
1,500. If the bear continues to control the market, the
index will continue to drop till the next support level of
Since the index is still in bearish mode, we suggest
investors take the opportunity when the time is right to
enter the market.

Support: 1,500 / 1,493
Resistance: 1,570 / 1,600
Mohd Fakhrul Asyraq Bin Mohd Aluwi, MSTA, CFTe

The JCI slid in early-February, continuing the slide from
January. The tumble was triggered by fears of the new
Coronavirus outbreak which originated from Wuhan –
China, spooking domestic investors. The JCI has been
forced lower and has broken the psychological support at
6,000; it is now in a bearish trend. That said, although
the outlook is not looking good, there are positive
sentiments with February seasonality of 7x gains and 3x
losses in the past ten years; furthermore, technical
indicators such as the RSI are now showing an oversold
signal – looking for a temporary rebound. Other positive
sentiments are coming from the rupiah which has been
strengthening against the dollar and hit a level as low as
Rp13,650. Looking forward, we expect a rise in volatility
in the month of February with the nearest support at
5,765 and resistance at 6,000.

Selective buy in stocks that have solid fundamentals and
attractive valuation, especially in sectors such as
banking, consumer and property.

Support: 5,875 / 5,765
Resistance: 6,150 / 6,350
Maskun Ramli, CFTe

Overall sentiment for the Thai equity market has become
bearish after the SET Index had fallen below 1,550 which
is a key support level. As the SET Index has been falling
below the neck line (1,550) and moving in a downward
channel which indicates that the medium-term outlook
has shifted to a downtrend, we have to presume that we
would possibly continue in a downward movement or
sideways momentum for many months. Also, we have to
set up a strategy based on the downward bias.

1,480-1,500 would be a good buying zone, given that
this level offers a good risk-to-reward payoff. The 1,500
support is derived from the lower bound channel while
the 1,480 support is derived from a trading momentum
(“a”) after the SET Index fell below its support (“b”). We
recommend investors buy at 1,480-1,500 for short-term
trading while investors should consider reducing
exposure/positions if the index falls below the 1,480

Support: 1,500 / 1,480
Resistance: 1,550 / 1,600

Sittiporn Jennaimuang

Monthly Technical Regional Indices Outlook

FTSE Straits Times Index (STI IND)
Moving within a triangle pattern

The recent attempt for the FSSTI index to penetrate above the cloud resistance has failed. The index has been moving within a triangle pattern and is now moving lower to test its lower rising trendline support at around 3,110. It has moved below the cloud and both the conversion and base lines, pointing to a bearish index outlook. The momentum indicator, the MACD, is also trading below its zero line, confirming the negative outlook. A bearish MACD crossover is likely in the coming weeks, hinting at a possible downward movement ahead. Watch out for the reaction at the lower trendline support. The index could continue moving within this triangle pattern if it can find support at the rising trendline. Otherwise, a break of the rising trendline could accelerate the downward movement of the index.

Investors could slowly accumulate if the index can sustain at the rising trendline. Otherwise, investors should look to sell if the index breaks below the rising trendline.

Support: 3,040 / 2,955
Resistance: 3,285 / 3,340
Wong Shueh Ting, CFTe

FTSE Bursa Malaysia Kuala Lumpur Composite Index (FBMKLCI IND)
Failed to break the trend line, downward continues

Based on the weekly chart, the FBMKLCI has failed to break the downward trend line and continues to form lower highs and lower lows which indicate a bearish trend. This bearish momentum is supported by the downtick in RSI and bearish crossovers in both MACD and DMI indicators. These indicate that selling momentum has started to overcome the buying momentum again. Moving forward, we expect another round of bearish trend if the previous low of 1,548 is violated.

Investors can slowly accumulate even if the index goes down. If the index does not fall below the previous low of 1,548, speculators can make a call, and start to take profit when the index starts to penetrate above the psychological level of 1,600 in the short to medium term.

Support: 1,548 / 1,503
Resistance: 1,594 / 1,610

Mohd Fakhrul Asyraq Bin Mohd Aluwi, MSTA, CFTe

Hang Seng Index (HSI IND)
Neutral: Range

The index posted a false breakout of the 50-week (blue line) moving average and is consolidating. Currently, the index is moving between a bearish trendline (formed since Feb 18) and the 250-week (purple line) moving average. The weekly indicators are mixed. The weekly RSI is below its neutrality level at 50% and lacks momentum. The MACD has crossed above its signal line but is still below its 0-level and lacks upward momentum.

Hence, as long as the 250-week moving average (around 25,694) is not broken, the index is likely to continue its range and challenge the 50-week moving average (around 27,577) again. A break above 27,577 would call for a further advance towards 28,588. Alternatively, a downward breakout below 250-week MA (around 25,694) would call for a further drop towards 24,541 (2018’s low).

Investors are recommended to accumulate stocks now and use 250-week MA (around 25,694) to control risk.

Support: 25,694 (250-week MA), 24,541 (2018 low)
Resistance: 27,577 (50-week MA), 28,588 (bearish trendline since Feb 18)

Joyce Chan, CMT

Jakarta Stock Exchange Composite Index (JCI IND)
Strong December seasonality

The JCI is looking for a rebound in December after it slid quite significantly in November. In the last 18 years, the JCI has never closed in the red in the month of December, indicating a strong and positive seasonal pattern. The JCI has also been holding well above the 6,000 level and indicators are showing early signs of recovery at beginning of the month. Sentiments from global market are looking positive with a potential phase one trade deal arising soon between the US and China, while domestic sentiments are improving after President Jokowi announced his new Cabinet while Bank Indonesia have lowered its 7day-reverse repo rate four times this year. Technical outlook has been showing signs of improvement since the beginning of the month with the JCI making a rebound by forming a long-body bullish candlestick last week. Looking forward, we expect the JCI to make a rebound and rally to challenge the resistance level at 6,170 and even 6,275. The support of 6150 should be able to hold the index for any selling pressure.

Sentiments and technical signals are starting to improve; hence, investors should bargain hunt with focus on sectors such as banking, consumer and construction.

Support: 6,150 / 6,000
Resistance: 6,350 / 6,470            

Maskun Ramli, CFTe

Stock Exchange Of Thailand Index (SET IND)
Falling to test key support level

The SET Index has declined to below the neckline of a “head-and-shoulder” pattern at 1,600, which has made sentiment bearish. The short-term outlook has become more negative as the index has continued to fall. A breach of the key support level in the medium term (1,540-1,550) will bring more bearish sentiment and more downside for the medium run (next 3-5 months).

The SET Index’s fall to the medium-term support might be a turning point or the beginning of a medium-term downtrend. If it is unable to hold onto 1,540-1,550, the downside for the correction would be at least 1,420-1,450. Investors should pay more attention to current support testing. We recommend reducing exposure/positions if the index breaches the support.

Support: 1,550 / 1,546
Resistance: 1,580 / 1,620

Sittiporn Jennaimuang