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
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