LAST close (Feb 7) 648.9 points, off 17.6 points from a week ago. Week’s high: 667.5 points: Week’s low: 648.8 points.
The Malaysia Derivatives Exchange (Mdex) KLCI futures prices was pressured by long-liquidation and speculative selling influenced by concerns and worries over the Iraq crisis. Moderately active selling took the February futures prices to a 12.4-point discount to the cash index during Friday’s close.
The February 2003 contract trended downwards from a weekly-high of 667.5 points to 648.8 points and settled the week sharply lower at 648.9 points, down 17.6 points from a week ago.
Total volume for the week fell sharply to 1,946 contracts from 6,873 contracts a week ago. Open-interests as at Thursday’s close declined to 2,059 contracts from 2,982 contracts previously.
Chart-wise, the February 2003 index futures prices are expected to stay under selling pressure this week.
Technically, the daily charts are showing an immediate support at the 645.0-640.0 levels. Breaking of these support this week could pressure the market lower to test its minor chart-support at the 635.0-630.0 points.
Chart-resistance for this week is adjusted lower to the 655.0-660.0 levels.
The daily and weekly technical indicators ended the week mostly bearish and indicated that the market’s immediate trend is negative.
The daily Money Flow Index (MFI): The daily MFI dropped from a weekly-high of 46.49 points on Feb 5 and closed sharply lower at 31.96 points. Analysis of the daily MFI shows that distribution pressure is not over. The weekly MFI closed sharply lower at 48.38 points and signalled that the near-term trend would remain subdued.
The 3-day and 7-day exponentially smoothed moving-average price-line (ESA) remained negative and ended Friday with a negative divergence. The 3-day and 7-day ESA-lines closed the week lower at 663.00 and 665.00 points respectively. Analysis of ESA-lines shows that the market may continue south this week.
Daily stochastics: The daily stochastics issued the short-term sell-signal on Feb 5 and ended the week in the bearish extended-move zones. The daily oscillator per cent K and D closed sharply lower at 15.37% and 24.85% respectively. Analysis of the daily stochastic shows that the market has room for more downside trading. The weekly stochastic expanded on the sell-signal of a week ago and closed with the per cent K and D at 60.80% and 72.04% respectively. Analysis of this weekly oscillator indicates that the near-term trend could stay bearish.
Daily moving-average convergence/divergence (MACD): The daily MACD (not shown in the chart) ended the week with its sell-signal intact and points the possibility of more weakness this week. The daily MACD and trigger-line ended lower at 3.99 and 5.92 points respectively. The weekly MACD retained its positive signal and has yet to give the trend-reversal signal. The weekly MACD and trigger-line ended the week lower at minus10.55 and minus 13.53 points respectively.
Daily relative strength Index (RSI): The daily RSI reversed direction from a weekly-high of 54.28 points on Feb 5 and closed the week sharply lower in the negative territory at 43.54 points. Analysis of the daily RSI shows that the index futures prices immediate underlying strength is bearish and recent weakness had not resulted in the market becoming oversold. The weekly RSI ended the week moderately lower in the negative territory at 45.11 points and indicated that the market main trend is bearish.
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