KLCI Direction

KLCI index hit a wall of resistance this week together with the stock market around the world.

Compared to other indexes around the world, KLCI is having a stronger performance. The index is still above its 200 day moving average and the death cross scenario where the 50 day moving average crosses below the 200 day moving average has not occurred.

However, there are warning signs in the technical chart.

Firstly, the MACD indicator is about to go below its signal line. The RSI indicator is decreasing but has not reached oversold values. This means that there is a short term weakness in the index. Stochastic chart is also showing weakness in the near term.

ADX is now at around 20 levels and looks to be ticking up. –DI is now slightly above the +DI. This suggests that the index is likely to continue moving down but the strength of the down move will not be strong unless we see a higher ADX value in the coming week.

All in all, the index will continue to go down in the coming weeks or at best be range bound. Do trade with care.

AirAsia Updates

Share price for AirAsia is now at a crossroad.

The MACD indicator is still bullish with the indictor above its signal line. However a worrying sign is a weakening MACD histogram. This shows that the upward move is losing momentum. And from the price chart, we can see that the chart is now looking to form a lower low. RSI is at neutral level. Stochastic indicator is showing weakness in the short term.

The price action is showing weakness as well. The stock price could not hold above the downtrend line and is now about the test the support line.

Critical support is at RM1.25 level. The resistance level is at RM1.35.

Genting Weakness Ahead

The chart for Genting is indicating weakness in the short term. This is in line with bearish conditions for the past few weeks.

The MACD indicator has just cut below its signal line, indicating that the bears are gaining the upper hand.

The price has pulled back towards its 50 day moving average and this will be a critical level to watch. If the price is not able to hold onto the 50 day moving average, bears may increase their selling pressure and it will violate the up sloping trend line that began in the month of Mar.

Any rebound will meet with selling pressure at RM7.06