Temporary bottom

The market has been bearish for the last few days as a spill over effect of the Dow's poor performance, however, our KLCI has been showing good resilience. As usual, the market started off the day with a slight positive sentiment with the CI registering the days high of 1385.89 within the first half an hour, thereafter, it went into the red territory hitting the low of 1370.33 and made a "u" turn upward after 3 pm, and as usual the magic hand brings the CI to close at 1383.43 (+1.08, +0.078%) forming a bottom reversal candlestick known as Hammer. From the chart, one can see that our CI is finding good support around the 1380 level, the market breadth of 420 gainers to 388 losers shows that the KLSE is not at all that bearish, in fact many counters such as KBES, MPHB, CBSTECH are showing signs that they can't wait to go up. Well, as the saying, "what goes up must come down, and what came down will go up too", that is how the market works. The broad trend of the KLCI is still up, the present is only a minor correction within a major uptrend. The market may go "yo-yo" between 1380 and 1413 to build a base before it climb further up, however, I believe that with the good effort of the whole nation our KLCI will continue to move up, slowly but steadily because Malaysia boleh.

On the regional side, Hang Seng Index (HSI) also showed the formation of a Hammer-like bottom reversal candlestick. From the chart one can see the immediate support of the HSI on the 50 day MA. The next major support for the HSI is around 26500, if this level can't hold, then the HSI will really turn bear. HSI's volatility is really different from that of KLCI, one must learn to get used to it. It is just like going to Indonesia, one must get used to the juta (million) of Rupiah that one carries, don't be nervours.

As for the DJI, it is showing a bullish Engulfing bottom reversal candlestick, the bulls are fighting back. As mentioned in the previous post, the 12950 level must be defended for the uptrend to be maintained, it did. With this, I believe a temporary bottom is formed, and DJI may go into a choppy sideway market while waiting for their problems to be solved.

Back to our KLSE, some of the counters that shows strong upward move amid the bearish time are MPHBWB, KIANJOO, CBSTECH, HARNLEN, KBES, and IE.

Disclaimer: The above is not a recommendation to buy or sell, all suggestions mentioned are purely for academic study purposes for our trend trader club members only, and the author may have personal interest and position in some of the examples mentioned. Any losses incurred if you were to trade base on the study examples above is sole your own responsibility. Do consult your dealer before taking any action.

What goes up must come down.

In my last post, I mentioned that our KLSE has on last Tuesday showed signs of hesitant to move further, and in fact on last Wednesday the market was under profit taking mode, but a last minute magic show brought the KLCI back to the green to closed at 1413.65 (31/10/07), and formed a Hanging-man candlestick. On last Thursday, the market open with a 6 points gap up and hit the record high of 1423.81 within the first 10 minutes, and thereafter goes into heavy profit taking and closed at 1409.16 forming a Dark Cloud Cover candlestick, the turn has begun. What goes up must come down is something that never change in the market. On last Friday, the market started with a short panic selling with Dow's overnight fall of 363 points, however, the panic was only for a short moment, and smart investors comes in to collect at lower price to end the KLCI higher than the opening at 1397.48 on Friday. On Monday, the market opened with a positive mode, however, the huge decline on HSI of 1500 points (5%) dragged down the regional market, and KLCI follows the fall to close at 1384.73 forming a Bearish Engulfing candlestick. Yesterday, the market was very quiet, KLCI slipped slightly down to a low of 1380.43 but the bull quietly surface at later part of the day, fighting back the battle and closed KLCI at 1389.11 forming a bullish Hammer candlestick.

A similar market bottoming Hammer candlestick was also seen on the HSI. My view is that the HSI's correction is still within the acceptable range in a uptrend. The rest are just fear.

As for the DJI, it is finding a strong support around the 13500 level. In fact, DJI closed Tuesday at 13660.94 with bullish reversal candlestick. Broadly speaking, DJI has moved into a sideway trend now, choppy ride ahead is expected.








On the individual counter side, JAKS, MPCORP, and EDEN may offer some good trading opportunities.









(Click to enlarge)

Disclaimer: The above is not a recommendation to buy or sell, all suggestions mentioned are purely for academic study purposes for our trend trader club members only, and the author may have personal interest and position in some of the examples mentioned. Any losses incurred if you were to trade base on the study examples above is sole your own responsibility. Do consult your dealer before taking any action.

KLCI all time high

As mentioned in the post on Thursday, KLCI actually made a break through of the 1400 mark on Monday in conjunction with the announcement of the ECER to close at the all time high of 1411.62, cheers! Malaysia Boleh! KLCI lagi Boleh!

As for Tuesday, the market opened with joy for the first 10 minutes and CI registered another intra day record high of 1416.97, thereafter the market goes into profit taking mode and CI corrected downward to the low of 1404.48, and remain in a sideway range for most part of the day, finally closed the day at 1412.79 (+1.17, +0.08%), a record high close. Volume reduce slightly to 1.8 billion shares traded, which is healthy.

Technically speaking, KLCI forms a Spinning Top candlestick yesterday, this indicates the market is a bit hesitant to move further at this level, in conjunction with DJIA's fall, the market may take excuse to profit take and further corrects downward to the 1398 level. The retail investors are getting smarter, they will take profit first whenever the market makes new high, as the saying, "A bird in hand is better than ten in the bush", money in your pocket makes you feel better.

Most of the stocks that we follow are doing well, BHIC, Landmark, Pohkong, Kretam, Unico are making new high, cheers! I am sure many of our friends are having sweet dream. However, always be on the guard, never let Greed over-rule, just follow the market signals, don't predict.

Some of the new stock to watch are MPHB, INCKEN.

Disclaimer: The above is not a recommendation to buy or sell, all suggestions mentioned are purely for academic study purposes for our trend trader club members only, and the author may have personal interest and position in some of the examples mentioned. Any losses incurred if you were to trade base on the study examples above is sole your own responsibility. Do consult your dealer before taking any action.