30/08/13 : Back to critical Gap Resistance 1730 to 1740

Date      : 30th Aug 2013 (Fri)
KLCI    :1,728 (+24)

Our KLCI continued to rally for the second consecutive day after it bounced near to the support at 1650. Another full and long white candle is formed and the earlier gap resistance is approached again. The volume traded is quite high. It shows
1. Technical rebound is still intact.

Critical Level:
1. Support : 1660
2. Resistance : 1730-1740

Technical Indicators:
1. Stochastic : Still bearish but bearish biased.
     The existence of technical rebound is further validated.

2. Bollinger band : No signal

Conclusion:
1. This is just a technical rebound for a decline although it had gone up a lot.
2. Total SHORT liquidation is needed essentially.
3. Be prepared for a short term SHORT when bearish signal comes.
Confidence level : 90%
    

30/08/13W : Bounce from the Support 1650.

Date     : 30th Aug 2013
KLCI   : 1,728 (+7)

It had been a very volatile week with plunge in the early week and recovered steadily. A very broad star candle is formed in the weekly chart surprisingly. It bounced near to the trendline, S~1650 as drew on last week.It shows the support at low level is strong and held the market to turn into long term downtrend.

Critical Levels:
Support : 1655
Resistance: 1763, 1830

Technical Indicators:
1. Stochastic: (Neutral)
     No signal is generated right now but be ready IF it turns up next week.
2. MACD : (Still bearish)
     The MACD and histogram continued to move downward.

Conclusion:
As the KLCI is able to hold above the up trendline, S~1650
1. Long term slow rally is still intact and not distorted.
2. This recent decline is just a mid term retracement.

29/08/13 : Gap Resistance 1700 was filled.

Date     : 29th Aug 2013 (Thu)
KLCI   : 1,704(+18)

After the KLCI had recovered from frenzy 1660 on yesterday consistently, it moves upwards further. A full long white candle is form eventually for the first time since the decline from 1801. The critical gap resistance 1690 to 1700 was filled completely and convincingly. However, the traded volume is low relatively.
1. This is just a technical rebound as it had dropped for nearly 150 points in 2 weeks.
2. Low 1660 serves as a temporary trough for this technical rebound.
3. The role of gap resistance is reversed. It serves as a support from 1690 to 1700.


Critical Levels:
Support Level : 1700, 1660 (as mentioned)
Resistance Level : 1730 (refer to earlier gap)


Technical Indicators:
1. Stochastic : Critical (biased to bearish)
     It has exited the bearish territory eventually when it moved above 20.
     The undergoing technical rebound is validated.
2. Bollinger Band : No signal
     The decreasing band width shows the technical rebound has begun.

Conclusion:
1. This is just a technical rebound for a decline.
2. Partial SHORT liquidation is encouraged. However, LONG establishment is still discouraged.
3. Be prepared to SHORT when bearish signal comes

Confidence level : 75% as highlighted by the arrow in the chart.

28/08/13 : Critical Gap Resistance at 1690-1700

Date      : 27th Aug 2013 (Wed)
KLCI    : 1,686 (-15)






Our KLCI is whacked frenziedly again in the morning but it bounced from 1660 consistently, setting a broad star candle. 1660 is likely to serve as a temporary trough in a decline because
1. The first significant buying since the consistent decline from 1801.
2. Expanding volume
3. Support 1650 (as referred to weekly chart) is reached roughly.

Critical Levels:
Support Level : 1650(weekly), 1660(recent low)
Resistance Level : 1700(gap resistance)

Technical Indicators:
1. Stochastic : Still bearish
    (a) Little tick up since it had been moving horizontally for about a week.
    (b) It implied the chance for a bounce is high
2. Bollinger Band : No signal

Conclusion:
The situation becomes critical because the chance for a technical rebound to happen here is increased. However, this rebound is not going to distort the mid term bearish view. LONG establishment is discouraged. Practically, SHORT shall be further held nimbly.

Confidence Level: 50%

27/08/13 : Still in Decline but not a good chance for SHORT addition

Date      : 27th Aug 2013 (Tue)
KLCI    : 1701 (-21)




The gap resistance, Rg=1730 was approached yesterday. Although it was exceed but it wasn't convincing because
1.  It didn't close above Rg and it was thrown down upon the closing, setting a star candle.
     It indicated the selling force at Rg is very strong. In fact, this is a weak bearish signal.
2.  The decreasing volume (day to day)
     It shows Rg is very strong and not easy to be exceeded.

As a result, it was whacked frenziedly today to the S=1700 as prepared. This is a critical control point as highlighted by the mid term down channel and a psychological level. Right now, this decline since h=1812 (Late July)is still classified as a retracement as our KLCI has been rallying since 2011 without a significant pullback rather than a crack down.
Support Level, S : 1700 (critical), 1650 (refer to weekly chart)
Resistance Level, R : 1730 (gap level)

Technical Indicators.
1. Stochastic : (Still bearish)
     Still in the bearish territory and it turned down further as the bear gained the strength further.
2. Bollinger Band:
     No signal is generated but still retained the earlier bearishness.

Conclusion:
1. The decline is still intact and no sign and trace for a bounce.
2. This is a not a good chance to add for SHORT position because it's danger.

Confidence Level: 70

23/08/13 : Gap Resistance at 1730

     The KLCI had been moving tightly for the whole trading day, setting a tiny and tight candle to churn the sharp decline below the huge gap, R=1,730~1,740. This gap is a control point to measure the strength of the bear. Right now, the bearish strength is still considered to be very strong. Once, there was a chance for a rebound for today because it seemed to bounce from the trendline and the fear of the global market was eased. However, it had failed. This phenomenon is interpreted our market sentiment is still very weak.

(A) Technical Indicator:
1. Stochastic: (Still bearish)
     Spending the 3rd day in the bearish territory (Oversold) as it was sent down since last week. The basic objective for this decline is achieved. However, there's any sign for a technical rebound unless it can leave the bearish territory later.
2.  Bollinger Band: (Still bearish)
     No signal is triggered today but it retains the bearishness induced by hbpc(A reliable bearish reversal signal) on last week and rti(A bearish reinforcement signal) on yesterday. As the band further expands, it implied the decline is still dominating, the tight movement today is yet to be considered as a technical rebound.

(B) Conclusion: 
      The short term decline since h=1801 is still intact. The support shall be the down trendline at 1,700 together with the psychological support level and the long term up trendline in weekly chart. Although the decline is very sharp, but it hasn't distorted the long term bullish view.

Confidence Level:  80

22/08/13(W) : The election gap is filled completely

Our KLCI had been retreating violently since the peak h=1801 was identified on last week through daily chart. The huge gap (1718-1724) formed right after the election was filled eventually after it had failed upon the attempt on last July. The gap filling implied the the strength of the long term rally isn't very strong. Probably, it's moving steadily in the up channel in the chart with a very weak bullish force. Right now, the selling isn't expected to distort the bullish long term view.

(A) Weekly Technical Signal:1. Stochastic :  (Neutral)
     Continued to move downwards for the 2nd consecutive week after the objective for previous bullish signal wBFS@1786 which was entering the overbought area 80 had been fulfilled. Right now, no signal is triggered yet.
2. MACD: (Bearish)
     The histogram turned negative after the weekly death cross on last week. The bearishness is reinforced and remained still intact. Although this weekly death cross isn't very reliable but it still achieves 60% accuracy.


(B) Conclusion:

     Although no technical signal is triggered on this weekly chart, but it still retained the bearishness atmosphere created on last week. Since it had declined sharply about 85 points in a single week, the chance for a technical rebound to happen is quite high before it further decline again.