Millionaire Trend Trader: FBM KLCI: update for Tuesday, 10-May-2011

Thursday, May 19, 2011

FBM KLCI: update for Tuesday, 10-May-2011

Stocks on Bursa Malaysia closed mixed yesterday with investors reluctant to take new positions amid concerns over the global economy. The overall market was bearish amid thin volume showing that investors were cautious after recent losses in commodities and with the uncertainty over the debt crisis in Greece and peripheral Europe. The FBM KLCI ended 3.91 points or 0.3% higher to close at 1.519.41, after opening 1.71 points higher at 1,517.21. Market breath was negative with losers outpacing gainers by 394 to 305, while 431 counters were unchanged. Turnover fell to 716.24 million shares worth RM1.08 billion from 855.73 million shares valued at RM1.1 billion recorded last Friday.

The FBM KLCI opened 1.71 points higher at 1,517.21 but profit-taking activities pressed it to the intra-day low of 1,515.39, and rebounded to the intra-day high of 1,520.36 before closing at 1,519.41. Chart-wise, the FBM KLCI formed a small white candlestick which indicates low volatility and consolidation. As mentioned in yesterday analysis, the resistance zone at 1,519 to 1,521 has posted as a barrier to the key index’s up move.

MACD continued to slide lower after crossing below the zero-line, indicating a continued loss in momentum and the FBM KLCI has turned bearish for the medium term. RSI (14) has hooked up to 44.4, reflecting the mild rebound, and is still in the mildly bearish zone. Stochastic continued to slide lower to 28.3, indicating weak market strength and continuation of the down cycle. Readings from the indicators showed that the FBM KLCI is currently in a weak condition and is likely to continue with its consolidation.

The short term trend of the FBM KLCI is currently down, while the medium term trend remained sideways. The much longer term uptrend is, however, still intact. With the volume shrinking volume, the FBM KLCI is likely to remain in consolidation mode with a downward bias.

Overnight, the Dow rose +45.94 points or +0.36% to close at 12,684.68. Today, the FBM KLCI is likely to trade within a range of 1,511 to 1,526.

This week's expected range: 1472 – 1551
Today’s expected range: 1511 – 1526

Resistance: 1522, 1524, 1526
Support: 1511, 1513, 1516

I can't access blogger.com or gmail at all while in China, Google was being blocked totally.

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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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Learning is a never ending journey in the stock market. The very moment you think you have learned enough, you'll fall. - Harrison Ho

When people are frightened, they cut their time horizon dramatically, even advisors will say to sell because they see portfolios crumble and they fear people will have nothing left. It's really not rational, but it does happen. - David Dreman

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Financial markets are supposed to swing like a pendulum: They may fluctuate wildly in response to exogenous shocks, but eventually they are supposed to come to rest at an equilibrium point. - George Soros

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Analysts have always been overly optimistic.
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If you believe that some day it's going to happen, some day it probably will happen. You just have to make sure you're there when it's happening, and ideally you're at the front of the parade, and the principle beneficiary of when it happens, but it's not a kind of thing where you just sort of sit back and wait. - Steve Case

I try to learn from the past, but I plan for the future by focusing exclusively on the present. That's where the fun is. - Donald Trump

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

The world is changing very fast. Big will not beat small anymore. It will be the fast beating the slow. - Rupert Murdoch

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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Be extremely subtle, even to the point of formlessness. Be extremely mysterious, even to the point of soundlessness. Thereby you can be the director of the opponent's fate. - Sun-tzu

Look at market fluctuations as your friend rather than your enemy.. profit from folly rather than participate in it. - Warren Buffett

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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 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

If you buy all the stocks selling at or below two times earnings, you will lose money on half of them because instead of making profits they will actually lose money, but you will only lose a dollar or so a share at most. Then others will be mediocre performers. But the remaining big winners will go up and produce fabulous results and also ensure a good overall result. - John Templeton

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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

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

Stock market bubbles don't grow out of thin air. They have a solid basis in reality, but reality as distorted by a misconception. - George Soros

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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Only buy something that you'd be perfectly happy to hold if the market shut down for 10 years. - Warren Buffett

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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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Thursday, May 19, 2011

FBM KLCI: update for Tuesday, 10-May-2011

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