Kuala Lumpur Stock Market Outlook - Forecast For The Day - 11 July 2007!


by Fred Tam - Date: 2007-07-13 - Word Count: 374 Share This!

KUALA LUMPUR STOCK MARKET OUTLOOK: Forecast for Wednesday, July 11, 2007: Lie low as market lacks new money. Very selective buy/hold.

Technically speaking:

1. As at Tuesday's close at 1371.45 the KLCI was lower by 7.24 points or 0.53%. Losers outnumbered gainers 485 to 439. Trading volume was 1.441 billion shares.

2. We are saying it again. There just isn't much new money coming into the local market. With you playing against me, and no one else taking over the baton from the last buyer, how can one expect stocks to rally? Where have also the players gone?

3. According to the above report, they are in Thailand now!

4. That leaves the local syndicates (albeit very small ones with little sustaining power) to play their old favourites, like PWORTH, EMIVEST, FARMBEST, BIG, BIG-WA, FTEC, etc.

5. But we would rather not touch these lower liners as they have been known to be "tricky" and unpredictable.

6. In the current malaise, we would suggest lying low, hold on and wait for this bad batch to blow over.

7. But if you insist on trading, then be very selective.

8. Our stocks for today are: BONIA, PROTON, FAVCO*, ENCORP*, E&OPROP, KBUNAI, KNM, HUBLINE*.

9. We like the ones in asterisks.

10. New stocks are SWEEJOO and MAYBULK.

11. In spite of the current weakness in the KLCI, technically it is still possible for the KLCI to move higher to test 1494, with much help expected to come from a stronger Dow, which Professor Hank Pruden tags the target for the Dow at 14,400.

12. We would be wrong if the KLCI falls to close below 1348 or lower.

13. The ringgit closed unchanged, at 3.4380 suggesting that our stocks should hold steady today.

CONCLUSION: In short we see a recovering Dow rubbing off onto Asian markets, and like it or not, some fallout will benefit the Malaysian market. It is not time stay out of the KLCI yet as the KLCI, at 1378.69, is still above its lower Bollinger band support of 1357 and its lower support of 1348. On the other hand, a breakout of the upper band at 1381 or higher today would be a good sign of a possible explosive rally.

Long-term Upside Targets:1492 (Target amended on 15/6/07).

Immediate downside targets: 1348/1319/1291/1222

Related Tags: money, stocks, shares, trading, buy, stock market, dow, forecast, hold, kuala lumpur stock market outlook, klci, trading volume, malaysian market

Fred Tam is the owner of www.fredtam.com andwww.picapital.com.my F1 Trader Online - Know when to enter & exit the markets.

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