20051017 Technical Outlook JetFM
CI continued to trade sideways as traders decided not to add new position into their book over the weekend. As a result, CI traded to an intraday high of 929.12 before settled at 925.59. For Monday market, Pivot Profit methodology indicates that the 1st and 2nd resistance levels will be 927.94 and 930.30. 1st and 2nd support levels will be 924.41 and 923.24.
Chart wise: ODDS Probability Cone showed CI upside was capped. It was undeniable that there were certain "players" in the stock market trying to create a higher high scenario for the CI in the past 2 weeks; but the market forces apparently did not buy into the "story" due to uncertainties of market direction. Following the short term upward support line violation on 13/10/2005, CI opened slightly higher on last Friday in an attempt to "distract" traders' attention from the "bearish" pattern on 13/10/2005; but market acknowledged that "bearish" pattern on 14/10/2005, this can be seen from the settlement level at the low of the day, 925.59. Therefore, with this low settlement level, CI was expected to trade lower today as more traders become better "informed" of the market situation. On the other hand, the use of ODDS Probability Cone methodology on CI showed that CI may have been reached its "top" since the rebound from the low of 906.54 on 2/9/2005. Each time CI tried to make a higher high, it could only reach the maximum height of the upper curve as shown on the chart; it did not go beyond the upper curve line. In short, we should not expect the market to go up at this juncture, unless the market strength is so strong that it carries the CI higher than the upper curve line of ODDS Probability Cone. In an analysis of Fibonacci Retracement studies, CI was at 40.2% retracement of a move from 953.88 (4/8/3005) to 906.54 (2/9/2005). At 50% of retracement level, CI would be at 930.21.
Technical wise: MACD line remained above the Signal line; however, the rate of increasing for MACD line seemed to have slowed down, making MACD line closer to cut below the signal line. MACD line fell to 1.50 (14/10/2005) from 1.65 (13/10/2005) with signal line readings up to 1.44 (14/10/2005) from 1.43 (13/10/2005). In view of this, traders should be ready for possible cross down to give a "sell" signal scenario. On Directional Movement Index, +DMI was above the -DMI. On the reading scales, +DMI was at 9, down from 11 (13/10/2006); but, -DMI also down to 7 from 9 (13/10/2005). That gave no sign of stronger down or up move; nevertheless, traders should begin to look at the market from downside bias perspective. ADX inched lower from 34 (13/10/2005) to 30 (14/10/2005) as the market continued to fluctuate in a small range, a sign of trendless situation. As for Stochastics, %K line was staying below the %D line and was seen getting further away from %D line, a sign of lower stock market. %K dropped to 64.3 from 66.7 (13/10/2005) with %D also fell from 69.0 (13/10/2005) to 66.9 (14/10/2005).
Our stock recommendation for today is:
Jak Resources (Trading Buy) at RM1.04 with a stop loss at RM1.00
Chart wise: ODDS Probability Cone showed CI upside was capped. It was undeniable that there were certain "players" in the stock market trying to create a higher high scenario for the CI in the past 2 weeks; but the market forces apparently did not buy into the "story" due to uncertainties of market direction. Following the short term upward support line violation on 13/10/2005, CI opened slightly higher on last Friday in an attempt to "distract" traders' attention from the "bearish" pattern on 13/10/2005; but market acknowledged that "bearish" pattern on 14/10/2005, this can be seen from the settlement level at the low of the day, 925.59. Therefore, with this low settlement level, CI was expected to trade lower today as more traders become better "informed" of the market situation. On the other hand, the use of ODDS Probability Cone methodology on CI showed that CI may have been reached its "top" since the rebound from the low of 906.54 on 2/9/2005. Each time CI tried to make a higher high, it could only reach the maximum height of the upper curve as shown on the chart; it did not go beyond the upper curve line. In short, we should not expect the market to go up at this juncture, unless the market strength is so strong that it carries the CI higher than the upper curve line of ODDS Probability Cone. In an analysis of Fibonacci Retracement studies, CI was at 40.2% retracement of a move from 953.88 (4/8/3005) to 906.54 (2/9/2005). At 50% of retracement level, CI would be at 930.21.
Technical wise: MACD line remained above the Signal line; however, the rate of increasing for MACD line seemed to have slowed down, making MACD line closer to cut below the signal line. MACD line fell to 1.50 (14/10/2005) from 1.65 (13/10/2005) with signal line readings up to 1.44 (14/10/2005) from 1.43 (13/10/2005). In view of this, traders should be ready for possible cross down to give a "sell" signal scenario. On Directional Movement Index, +DMI was above the -DMI. On the reading scales, +DMI was at 9, down from 11 (13/10/2006); but, -DMI also down to 7 from 9 (13/10/2005). That gave no sign of stronger down or up move; nevertheless, traders should begin to look at the market from downside bias perspective. ADX inched lower from 34 (13/10/2005) to 30 (14/10/2005) as the market continued to fluctuate in a small range, a sign of trendless situation. As for Stochastics, %K line was staying below the %D line and was seen getting further away from %D line, a sign of lower stock market. %K dropped to 64.3 from 66.7 (13/10/2005) with %D also fell from 69.0 (13/10/2005) to 66.9 (14/10/2005).
Our stock recommendation for today is:
Jak Resources (Trading Buy) at RM1.04 with a stop loss at RM1.00
posted by emacro @ 7:43 PM
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