Market Outlook as at November 4, 2008

The KLCI is poised to surpass the 20-day SMA at 916 level, with the MACD looks set to do a positive crossover. Both of these are likely to happen over the next few days. Thereafter, I expect the KLCI to continue to inch up further to 920-930 level before correction set in. After the correction, I believe that the KLCI may continue to go higher & test its medium-term downtrend line resistance at 990-1000. If the KLCI can surpass its medium-term downtrend line, the technical outlook for the market would change from the present cautious, but still bearish market to neutral, yet mildly bullish market. I am inclined to believe that the KLCI may not surpass the medium-term downtrend line. Let's wait & see.


Chart: KLCI's daily chart as at November 3, 2008 (source: Tradesignum.com)