STOCK MARKET OUTLOOK: Look for 62% Fibonacci resistance at 1308
for KLCI but overall, world equity markets still viewed as technically weak.
On Monday’s close the KLCI was up by 2.49 points or 0.19% at 1297.16 on lower volume of 502 millionshares traded. Advancers led decliners by 302 to 242 with 269 stocks unchanged.
1. Stocks rose for a fifth day, U.S. index futures gained and commodities rallied on speculation government reports this week will show the global economic rebound is continuing. The yen weakened and bonds fell, according to Bloomberg.
2. The Dow was up 38 points to 10,211 last Friday and this rubbed off onto Asian stocks.
3. Yesterday all Asian equity market rose except for Australia.
4. With this continuous rally over the past six sessions, investors are now hopeful of a recovery of the U.S., Europe and Asian stocks in line with speculation of a global economic rebound.
5. Malaysian investors reacted positively to the Dow’s and Asian rally and situational stocks like FABER, KPJ, UNISEM, GENP, SPSETIA, GENP, MBSB faired pretty well and were amongst the top gainers for the day.
6. However, the volume did not reflect that buyers were aplenty. At best, I would say our gainers were propped up by some institutional funds whilst the lower liners are still struggling to stay afloat due to a lack of buyers.
7. Those of you who want to be participating in this short term rebound should be careful not to be overly bullish.
8. Our picks for today are: FABER and KPJ.
9. There are also BOUSTEAD, MBSB, MEDAINC and MTD but we are not picking them as the overall climate is still bearish as price is still below the Ichimoku clouds.
10. If you are short stock index futures, look to cut loss at 1310 OH as the 62% resistance is 1306.
11. The ringgit strengthened from 3.2500 from 3.2810.
1. Stocks rose for a fifth day, U.S. index futures gained and commodities rallied on speculation government reports this week will show the global economic rebound is continuing. The yen weakened and bonds fell, according to Bloomberg.
2. The Dow was up 38 points to 10,211 last Friday and this rubbed off onto Asian stocks.
3. Yesterday all Asian equity market rose except for Australia.
4. With this continuous rally over the past six sessions, investors are now hopeful of a recovery of the U.S., Europe and Asian stocks in line with speculation of a global economic rebound.
5. Malaysian investors reacted positively to the Dow’s and Asian rally and situational stocks like FABER, KPJ, UNISEM, GENP, SPSETIA, GENP, MBSB faired pretty well and were amongst the top gainers for the day.
6. However, the volume did not reflect that buyers were aplenty. At best, I would say our gainers were propped up by some institutional funds whilst the lower liners are still struggling to stay afloat due to a lack of buyers.
7. Those of you who want to be participating in this short term rebound should be careful not to be overly bullish.
8. Our picks for today are: FABER and KPJ.
9. There are also BOUSTEAD, MBSB, MEDAINC and MTD but we are not picking them as the overall climate is still bearish as price is still below the Ichimoku clouds.
10. If you are short stock index futures, look to cut loss at 1310 OH as the 62% resistance is 1306.
11. The ringgit strengthened from 3.2500 from 3.2810.
CONCLUSION: The Dow, Hang Seng, Singapore and KLCI Ichimoku charts remain below the clouds suggesting that these markets are still in a bear phase. In spite of the rebound we saw yesterday, the indices are ALL below the clouds. My conclusion is, therefore, I am bearish and it is sell market since the 50%-62% rebound level was hit but be careful if you short index futures as buy-stop is at 1310 OH.
Upside Targets: 1283(hit), 1297 (hit)/1308 (Revised targets on 3/06/10)
Immediate downside targets: 1224-00/1154/1033 (Revised on 20/05/10)
Ichimoku chart: Span A resistance: 1288/92 (Revised on 2/03/10)
Immediate downside targets: 1224-00/1154/1033 (Revised on 20/05/10)
Ichimoku chart: Span A resistance: 1288/92 (Revised on 2/03/10)
KLCI: STAY ASIDE: POSSIBLE CORRECTION/NO BUY SIGNAL
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