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Thursday, February 10, 2011

Market update & observation

What should we observe???
·         Investors are taking profits after DJIA increase for the 7th consecutive days. Yesterday DJIA closed on green as Bank of America shares helped to squeeze out the gains in the 8th straight days. From 28 Jan to 9 Feb, the Dow increased from 11,823.7 to 12,239.9 within 8 consecutive trading days.
·         Investors are anxious about inflation everywhere. China increased interest rate for the second time 2 days ago and may increase for the 3rd time in four months. Instead of increasing interest rate, Federal Reserve Chairman Ben Bernanke lowered bond yield to curb inflation.  
·         China will announce its inflation data tomorrow.
·         Federal Reserve Chairman Ben Bernanke said the world’s largest economy, US remains weak despite a drop in unemployment rate earlier.  Investors may have doubt on the stability of US economy after the comments.
Let’s work out something on Malaysia market….

 
Are we on the 5th wave? Or we are still in the pullback of the 4th wave? It could be neither of them.
As there are many uncertainties blowing in the market, many confirmations have to be made technically before we conclude it. Anyhow, the first critical point to observe is the 1,500 psychological level. As of 4:47pm FBM KLCI was 1,509.50, which dropped 26.57 points or 1.73%. FBM KLCI February future was bearish as well, dropping 23 points from 1,525 from Wednesday close to 1,502.
If it happens, I'm eyeing on the 1,480 and 1,430 support lines. Otherwise, 5th wave will continue. Resistance is lying in between 1,545 and 1,560.

(Sources: Bloomberg, the Edge)

Disclaimer: The company analysis that appear in this blog is merely facts gathered from different sources and the author's personal view. It is not a buy or sell recommendation. The author do not guarantee the accuracy of the facts being presented. Please consult your investment advisors before acting on any information provided by the analysis above.

 

1 comment:

  1. From my analysis, the technical outlook for Lynas has deteriorated sharply.
    It appears that the significant medium term resistance has re-established at $1.35 and the stock has recently retraced from this level yet again. As noted in earlier discussions, the RSI initiated a sell signal two weeks ago and this position is supported by current developments. I also note a bearish slightly convoluted Head and Shoulders pattern. This pattern would suggest a break of near term support at $1.20 and a move towards the significant support at $1.00. Volume patterns confirm this Head and Shoulders formation.
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