Monday, December 17, 2018

Market Outlook as at December 17, 2018

On opening, FBMKLCI lost 16 points to make a low of 1645. By 10:40 a.m. FBMKLCI recovered back to ~1655. From Chart 1, we can see that FBMKLCI should have support at 1650, which is both the horizontal line as well as the line connecting the lows in the past 8 years (ignoring the low made in 2015). If this support failed, then the index may drop to 1600-1605.

Chart 1: FBMKLCI's weekly chart as at Dec 17, 2018_12:30 p.m. (Source:

Meanwhile, the market may benefit over the next few months from the usual CNY rebound. My clients asked me whether this positive effect will emerge again given the preponderance of negative factors in the market. I will let you form your own opinion on that. Just look at Chart 2 below.

Chart 1: FBMKLCI's weekly chart as at Dec 17, 2018_9:30 a.m. (Source:

Based on past market behaviors, I think that we can expect some positive sentiments at the start of next year. If you are looking to reduce your position in the market, I think you can defer that to early next year. Good luck!

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