THE local stock market consolidated its recent gains in relatively firm sentiment last week, in step with New York and other Asian bourses.

The benchmark FTSE Bursa Malaysia Kuala Lumpur Composite Index (FBM KLCI) continued to stay above the 1,450-point level for the entire week. It hit a week high of 1,493.28 on Monday and a week low of 1,452.64 on Thursday, a trading range of 40.64 points.

The FBM KLCI closed at 1,477.51 on Friday for a week-on-week loss of 4.31 points, or 0.29 per cent.

Share prices on the New York stock market staged a technical pullback last week. The Dow Jones Industrial Average closed lower at 11,983.24 points on Friday, down 247.87 points, or 2.03 per cent, for the week.

Kulim (Malaysia) Bhd closed higher at RM3.65 on Friday for a week-on-week gain of seven sen, or 1.96 per cent.

Kulim has three core businesses: plantations, fast food, and intrapreneur ventures.

The group’s plantation operations span three countries (Malaysia, Papua New Guinea and the Solomon Islands) covering 165,372ha.

Its involvement in fast food is through QSR Brands Bhdwhich operates the Kentucky Fried Chicken, Pizza Hut and Ayamas chains.

The group is also involved in a variety of growing businesses, driven by individuals who own minority stakes in the companies.

The following are the readings of some of Kulim’s technical indicators:

Moving Averages: Kulim’s daily price trend continued to stay above its 10-, 20-, 30-,50-, 100- and 200-day moving averages.

Momentum Index: Its short-term momentum index stayed above the support of its neutral reference line last week.

On Balance Volume (OBV): Its short-term OBV stayed above the support of its 10-day moving averages.

Relative Strength Index (RSI): Its 14-day RSI had since stayed above the 50 level. Its technical reading stood at the 63.84 per cent level at the market close on Friday.

Outlook

Continuing buying support for key heavyweight index-linked counters propped up the FBM KLCI. Out of the 30 component stocks of the benchmark index, 19 ended the week higher compared with 26 in the previous week.

Main Board second and third liners as well as ACE Market counters continued to dominate trading activities, reflecting the increasing retail interest.

Select second and third liners were well supported by both institutional and retail investors. Kulim was one of these counters.

Chartwise, Kulim’s monthly price trend staged an overhead breakout of its overhead resistance (A1:A2) .

Its fast monthly MACD (Moving Average Covergence Divergence indicator) continued to stay above its monthly slow MACD.

Its weekly price trend staged a technical breakout of its intermediate-term downtrend (See Kulim’s weekly price chart B3:B4). Last week, its weekly price trend continued to stay above its intermediate-term uptrend (B1:B2).

Kulim’s daily price trend staged a technical breakout of its intermediate-term downtrend (See Kulim’s daily price trend C1:C2) last week while continuing to stay above its short-term uptrend (C3:C4).

Its daily and monthly fast MACDs stayed above their respective slow MACDs at the market close on Friday. However, its weekly fast MACD continued to stay below the respective slow MACDs.

Its 14-day Relative Strength Index (RSI) stood at the 63.84 per cent level. Its 14-week and 14-month RSI were at the 56.94 and 69.19 per cent levels respectively.

Given the decisive technical breakout of its intermediate-term and short-term downtrends (B3:B4 and C1:C2) on Friday, it is envisaged that Kulim’s daily price trend is likely to stage a follow-through rebound this week. It is likely to re-challenge its immediate overhead resistance at the RM3.85-RM4.00 levels over its intermediate-term perspectives.–BTimes

The subject expressed above is based purely on technical analysis and opinions of the writer. It is not a solicitation to buy or sell.