Malaysia political dramatic events continue to unfold this week when a reporter, a blogger and a politician were arrested under Internal Security Act (ISA - draconian law). The reporter was arrested for a day under the draconian law with a lame excuse by the Home Minister as a protection to the life of the reporter. KLCI downed -15.86 points to close at 1028.17 points while the FKLI Sept contract downed -28 points to close at 1010 points for the morning session. What a dramatic event!!
In the FKLI hourly chart above, we can see that FKLI Sept contract made a corrective Elliot zig-zag wave pattern and closed at 1038 crucial level on last Friday 12th Sept. However, interesting and dramatic events unfolded last week to point to much lower and worst condition for Malaysia Kuala Lumpur Composite Index (KLCI). Technically the next stop for KLCI will be at 922 points before we could see the next healthy corrective rally. Back to the chart, it showed that FKLI Sept could be consolidating around this level or rally up further to 1015 or 1020 or even 1027 points. This consolidation or corrective pattern just temporary and worst downtrend expected when the consolidation completes its course. Personally, I expect to see a change of government leader. Well, I don’t want to be caught under any draconian law for making any statement here. Anyway, that was the global trend that is going on globally from Pakistan, Israel, Japan, Thailand, Zimbabwe, and Taiwan and now in Malaysia.
FCPO Dec contract rallied up on last Friday 12th Sept and closed right at the Fibonacci 23.6% retracement level. That resistance point was made stronger when it coincides with the diagonal trendline resistance point. That level was a very good point to add short position. The bear trend for crude palm oil futures was confirmed when it opened lower below the crucial level of RM 2343. We can expect FCPO to trend much lower this few days. My immediate target for FCPO remained at RM 2225 before we see a good rebound.
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FCPO immediate downside target revised to RM 2060 before a short rebound corrective rally. However be reminded that crude palm oil bearish trend point to much lower level. Crude oil fell below USD 100 for the first time after touching the high of USD 147. Crude oil right now traded at USD 91.86.