KLCI ... Bullish Trend Is Getting Stronger Without Overbought

 

After staying sideways in the past one month prior to 24 June 2014, the KLCI finally break above the immediate resistance level at 1880 points. The breakout indicates that market confidence has strengthened as investors take higher risks. The short term target is at 1910 points. The KLCI has stayed above the short term 30 day MA.

 

The momentum indicators are now starting to show strength. After being directionless for the past few weeks, momentum indicators like the RSI and Momentum Oscillator are now rising higher without being overbought. The MACD indicator has crossed above its MA after staying below it in the past one month. Furthermore, the close above the top band of the Bollinger Bands indicator indicates a strong breakout of a sideways trend.

A weakening USD may continue to make Asian markets more attractive. This may continue until there are signs of a USD rebound.

Technically, the bullish trend is getting stronger and there is potential upside as the Oscillator indicators do not show that KLCI is overbought. Henceforth, expect the market to remain bullish at least until the end of June 2014 with the KLCI testing the next target of 1910 points.

Support level of the bullish trend is currently (25 June 2014) at 1880 points.