Bursa Malaysia: Weekly Technical Trading Analysis and Forecast for week ahead

Weekly wrap of KLCI: The week started with opening 7.13 points positive, performed with buying sentiments in the beginning and maintained a mixed movement throughout and ended in a positive note. 

The FBM KLCI index gained 16.50 points or 0.89% on Friday. The Finance Index increased 0.65% to 16422.79 points, the Properties Index up 0.21% to 1337.95 points and the Plantation Index rose 1.11% to 7749.53 points. The market traded within a range of 12.87 points between an intra-day high of 1862.58 and a low of 1849.71 during the session.
The KLCI ended the week on a positive note, closing at 1862.58 points. The performance of our benchmark index was in line with overnight gains in US market as positive corporate earnings and rise in crude oil prices overshadowed the weaker performance in US new home sales data in March.
FBM KLCI Week's Performance
Open: 1862.58
High: 1862.58
Low: 1849.71
Close: 1862.58
Change (Points): 16.72
% Change: 0.90%
Market Forecast for week ahead: Market is moving by taking correction on weekly basis it is forcasted to be on positive note next week. As Malaysian government expecting economy to grow between 4.5% and 5.5% this year on the back of strong economic fundamentals. And if Malaysia achieved its fiscal target for 2015, it would be a record of six consecutive years of fiscal deficits.
Weekly Technical view on KLCI
Support 1: 1832
Support 2: 1815
Support 3: 1789
Resistance 1: 1856
Resistance 2: 1880
Resistance 3: 1890
Technical indicators: RSI for this week is 60.649 with CCI at 129.338. Besides, difference line of MACD 8.942 and crossed its signal line -1.022.
ECONOMIC FACTORS:

• Bank Negara governor Tan Sri Zeti Akhtar Aziz said any changes in Malaysia's monetary policy will be based on domestic consideration while stressing that the economy is still staying on a steady growth path. It is anticipated that the central bank may start to cut the overnight policy rate by 25 to 50 basis points.
• Interest rates hike by the United States Federal Reserve (Fed) must happen this year as the uncertainty on the timing of the hike is causing volatility in regional markets.
• The ringgit’s decline is more influenced by non-economic factors and an over-reliance on oil and gas revenue, as well as political issues.
• Moody’s Investors Service today assigned a definitive A3 senior unsecured rating to the US dollar trust certificates (sukuk) issued by Malaysia Sovereign Sukuk Bhd, a special purpose vehicle established by the Malaysian government.An aggregate interest of over US$9 billion (RM32.67 billion) drawn from the issuance of Malaysia's US$1.5 billion sukuk recently signalled foreign investors' confidence in the country's long-term economy fundamentals, a treasury official said.
• Bank of America Merrill Lynch (BofAML) expects Bank Negara Malaysia (BNM) to cut the overnight policy rate (OPR) by 25bps in the second half of the year, due to weaker consumer spending, investments and exports that would lead to significantly slower growth.