KUALA LUMPUR: Bursa Malaysia is expected to maintain its sideways pattern this week until new catalysts emerge, according to Rakuten Trade Sdn Bhd.
Equity research vice-president Thong Pak Leng said the brokerage expects trading to be muted in conjunction with Christmas followed by the New Year holidays. From a technical point of view, Thong said the short-term outlook for the FBM KLCI remains cautious, reflecting subdued momentum and weak recovery signals while a medium-term rebound will require a decisive move above the 50-day exponential moving average.
“Long-term prospects remain favourable as long as key support levels are maintained,” he told Bernama.
For short-term trading, he said traders should watch out for the 1,590 and 1,610 levels while long-term investors may consider accumulating near 1,570, focusing on stocks with strong fundamentals.
“We advise investors to monitor the moving average convergence and divergence line closely for a bullish crossover as this could be an early signal of recovery,” Thong added.
SPI Asset Management managing director Stephen Innes agrees that this week’s market is expected to see the usual holiday slowdown. Unless a geopolitical shock occurs, he anticipates that the market will maintain a somewhat neutral stance.
“Yet, with US President-elect Donald Trump in the picture, there is no guarantee that headlines would remain quiet. Therefore, the sentiment is likely to stay guarded as market participants remain wary of any sudden developments,” Innes said.
Last week on a Friday-to-Friday basis, the FBM KLCI weakened by 17.34 points to 1,591.41 from 1,608.75 in the previous week.