2012 June FBMKLCI Analysis Final

• First of all try to look back my previous analysis (  http://christrade.blogspot.com/2012/06/2012-june-fbmklci-analysis-3.html  )
• Market as expected struggling on the Blue Zone.
• With the Euro News, I am expecting next trend will be hitting my 138.2% Fibonacci point which is the next resistance of bullish.
• There are plenty of IPO is releasing these days, so you can try to link on them with the market. 

2012 June FBMKLCI Analysis 3

• Try to look back my previous analysis : http://christrade.blogspot.com/2012/06/2012-june-fbmklci-analysis-2.html
• It hits my 100% fibonacci Resistance. 
• I am assuming that FBMKLCI is in sideway trend which is struggling in Blue Zone.
• Either UP or DOWN, you have to observed on the Support and Resistance Line.

2012 June FBMKLCI Analysis 2

chart (A)

• First of all, try to refer back my previous analysis  http://christrade.blogspot.com/2012/06/2012-june-fbmklci-analysis.html 
• It hits my Fibonacci Projection 61.80% and going to hit my 100% Fibonacci Projection resistance level
• Fibonacci 61.80% become my first support level and I remain the same previous critical support level.
• The last 3 candlestick ( a small black doji ) hits my resistance. So it proved that my previous forecast call is correct said by Mr Market. 
• What is the next level? Look at the highest Resistance.

2012 June FBMKLCI Analysis

chart (a)

The first step, I will look into candlesticks. I combine the 2 highlighted candlesticks together, it's actually showing a hammer which still look bullish in the mean time. But what the last candlestick told me it's actually is a small shooting star, so to prove either bull or bear I will look for confirmation.

Second step, I will look into MACD and Stochastic Trend. Both of them are showing uptrend. 

So from chart (a), I will make a simple conclusion. From the market sentiment it's actually quite bullish with Local Fund supporting and all the good news supporting the worldwide market.

Links of news :

Malaysian banks may yet post suprises in their earnings

Read more: Malaysian banks may yet post suprises in their earnings http://www.btimes.com.my/Current_News/BTIMES/articles/king/Article/#ixzz1xUqOEtds 

Spain aid deals calm Europe Fears

Read more: http://www.btimes.com.my/Current_News/BTIMES/articles/10wallstreet/Article/#ixzz1xSuS1mES

China revives key economic reform

Read more: http://www.btimes.com.my/Current_News/BTIMES/articles/20120610234238/Article/#ixzz1xSusEeq7

'Australia's strong economy proving doomsayers wrong'

Read more: http://www.btimes.com.my/Current_News/BTIMES/articles/20120610234614/Article/#ixzz1xSuw8TED

chart (b)

From the weekly chart, we can actually see a bear flag. Either it is breaking up or down. 

Two signals showing downtrend which is MACD and chart pattern. But stochastic still showing a uptrend. 

 

chart (c)

Actually I use Fibonacci Projection to project how high FBMKLCI could go.

Resistance : 1588.61

Support : 1554

First Resistance is actually 61.80% of Fibonacci Projections. 

FBMKLCI Trend ( 26/5/2012 )

FBMKLCI daily chart picture (A)

FBMKLCI trend breaking 20MA

From the daily chart showing FBMKLCI is on a strong support at 20MA since 2011 December until recently 15/5/2012 with a down-trend signal with a confirmation on the following date of 26/5/2012. What we understand is that we should sell off all our holding shares while the confirmation of KLCI is in down-trend. 

FBMKLCI weekly chart picture (B)

We can clearly see from the above weekly chart that FBMKLCI is breaking below 20MA where the long black candlestick at the end of the chart is slipping downward passing the 20MA red line. 

Foreign Fund and Retail Investors continuously selling will lead to a down-trend in KLCI. If you are following the chart that I post daily, you may see Foreign Fund's daily activities - selling, collecting profit and slow buying on these days.  The concept of "If.. Then.. " is very useful in forecasting what will happen in our market. With this concept, you may easily detect what will be happening in upcoming trend. Do not feel surprise that if KLCI is in green then the chart showing that it is breaking below 20MA and bearish. Since most people are unfamiliar with Technical Analysis, they will not be able to detect this movement. And thus making unnecessary mistake in trading. 

This is how I perceive the movement of KLCI with the guidance of my sifu Mr Lee. Technical Analysis is one of the most important elements for us to consider if we intend to have a profitable trading.