Chart 1: DJIA & S&P500 daily chart up to June 30th (source: Stockcharts.com)
Chart 2: DJIA & S&P500 weekly chart up to June 30th (source: Stockcharts.com)
Our KLCI has yet to recover above the 1200 level. Further weakness could send the index to its March "low" of 1157. A break of this level could be very negative. We can see that the next supports thereafter would be the psychological 1100 level; the long-term uptrend line of 1030-50; and, finally, the psychological 1000 level. With the monthly MACD & William %R giving decidedly negative reading, the outlook for the KLCI is not good.
Chart 3: KLCI's monthly chart as at June 30th (source: Quickcharts)
Based on the bearish outlook, it is best to stay by the sideline for now.
2 comments:
the malaysian market is probably much affected by the volatile political scenes. when would investors start to have confidence that our market is not really going to crash like zimbabwe?
Hi wy kam,
Our political crisis is certainly affecting our economic life, including our stock market. I am not sure we would perform like Zimbabwee stock market. That market, contrary to general expectation, has a year-to-date gain of 896 284 percent (as per a report from the Harare Herald dated June 27th, see link below). I don't know how much is that gain after converting to USD, because the rampant inflation there. Like Burma, Zimbabwee is an absolute basket case. Despite the "gutter" politics being played out locally, I doubt we would ever descent to the level of Zimbabwee or Burma.
http://allafrica.com/stories/200806270050.html
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