Millionaire Trend Trader: Technical Rebound

Friday, December 11, 2009

Technical Rebound

Shares on Bursa Malaysia ended mixed yesterday. The FBM KLCI rebounded to close 4.14 points or 0.33% higher at 1259.90, after three consecutive sessions of losses. The benchmark index opened 0.56 points higher and remained in the positive territory, supported by overnight’s gain on Wall Street. However, losers still led gainers by 334 to 279 with 255 counters unchanged. Volume traded was lower at 572 million shares, valued at RM818 million.

Chart wise, the FBM KLCI formed a bullish white candlestick yesterday, signifying a pause to the current short term correction, and the medium term 50-days moving average at 1255 has provided support to the downtrend. MACD has rebounded slightly, indicating a slow down in downward momentum. RSI too has hook up, but still remain below the 50 mark. Stochastic has turned flat. With the technical indications, the index may try to form bottom at this level, and the underlying longer term uptrend is still intact.

Today, the FBM KLCI is expected to trade within a range of 1253 to 1265

This week's expected range: 1230 – 1288
Today's expected range: 1253 – 1265

Resistance: 1261, 1263, 1265
Support: 1253, 1255, 1257

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What's happening now is that the market remains trading at very thin volumes and that can affect prices, even when just a handful of shares are traded. The decision of any fund to pull out from certain stock hits the price. - Carlos Slim

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Analysts have always been overly optimistic.
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The more flexible an economy, the greater its ability to self-correct in response to inevitable, often unanticipated, disturbances and thus to contain the size and consequences of cyclical imbalances. - Alan Greenspan

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The price pattern reminds you that every movement of importance is but a repetition of similar price movements, that just as soon as you can familiarize yourself with the actions of the past, you will be able to anticipate and act correctly and profitably upon forthcoming movements. - Jesse Livermore

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Before this century is over, the Dow Jones Industrial Average will probably be over one million versus around 10,000 now. So for the long-term, the outlook is tremendously bullish if you buy stocks blindly to keep for a century. - John Templeton

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The individual investor should act consistently as an investor and not as a speculator. This means.. that he should be able to justify every purchase he makes and each price he pays by impersonal, objective reasoning that satisfies him that he is getting more than his money's worth for his purchase. - Benjamin Graham

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The financial markets generally are unpredictable. So that one has to have different scenarios.. The idea that you can actually predict what's going to happen contradicts my way of looking at the market. - George Soros

Our favourite holding period is forever. - Warren Buffet

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Checking the results of a decision against its expectations shows executives what their strengths are, where they need to improve, and where they lack knowledge or information. - Peter Drucker

The market does not beat them. They beat themselves, because though they have brains they cannot sit tight. - Jesse Livermore

Wide diversification is only required when investors do not understand what they are doing. - Warren Buffett

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Most of the time common stocks are subject to irrational and excessive price fluctuations in both directions as the consequence of the ingrained tendency of most people to speculate or gamble... to give way to hope, fear and greed. - Benjamin Graham

The price pattern reminds you that every movement of importance is but a repetition of similar price movements, that just as soon as you can familiarize yourself with the actions of the past, you will be able to anticipate and act correctly and profitably upon forthcoming movements. - Jesse Livermore

I think you have to learn that there's a company behind every stock, and that there's only one real reason why stocks go up. Companies go from doing poorly to doing well or small companies grow to large companies. - Peter Lynch

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The key to making money in stocks is not to get scared out of them. - Peter Lynch

I never hesitate to tell a man that I am bullish or bearish. But I do not tell people to buy or sell any particular stock. In a bear market all stocks go down and in a bull market they go up. - Jesse Livermore

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Friday, December 11, 2009

Technical Rebound

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