20051012 Technical Outlook JetFM

CI breached above 930-resistance again on another attempt to an intraday high of 930.95; however, inadequate follow through buying interest from the market failed to push the CI through decisively. As a result, CI settled at 928.43 on profit taking activities. The failed market action(s) to lift the CI higher in the last 2 trading days may have well given a hint that the stock market could have found its top at 930-level. A glance at the CI performance, it may seem as if market was waiting for a "trigger" to open up a new move; but, there were technical signs indicated that strong hands have been distributing their stock portfolio positions to the weak hands. For Wednesday market, Pivot Profit methodology indicates that the 1st and 2nd resistance levels will be 930.43 & 932.43. 1st and 2nd support levels will be 926.95 & 925.47.
 
Chart wise: CI traded at 929.01 on opening bell, 1.01 point higher than the previous day's close of 928. But, the stock market went down to an intraday low of 927.47 before closing at 928.43, it showed that not only traders were not so willing to add more stock into their portfolios, they even took the opportunity to liquidate some stock portfolios. Volume of shares traded yesterday was at 389.52 million, lower than 450.9 million recorded on 10/10/2005. This was an indication of traders staying sideline despite attempt to penetrate the 930 level.
 
Technical wise: MACD line rose to 1.62 (11/10/2005) from 1.49 (10/10/2005). The signal line reading also rose to 1.25 (11/10/2005) from 1.15 (10/10/2005). On Directional Movement Index, +DMI was at 18, down from 20 (10/10/2006), but -DMI stayed flat at 5 (11/10/2005). ADX inched higher from 40 (10/10/2005) to 43 (11/10/2005). As for Stochastics, %K line was near the borderline to cross over the %D line.
 
Our stock recommendations for today are:
XiangLeng (Trading Buy) at RM1.87 with a stop loss at RM1.77
Supermax Corp (Trading Buy) at RM3.50 with a stop loss at RM3.40