Market Outlook as at June 11, 2012

Our FBMKLCI is again testing its downtrend line at 1578. An upside breakout above that line would mean the market could be sideway or even stage a recovery.


Chart 1: FBMKLCI's daily chart as at June 11, 2012_3.45pm (Source: Stockcharts)

Most of the important equity markets have broken above its medium-term downtrend line, with the exception of DAX. This means that these equity markets have found a temporary bottom, where a base could be formed or a recovery could begin.


Chart 2: STI's daily chart as at June 8, 2012 (Source: Stockcharts)


Chart 3: HSI's daily chart as at June 8, 2012 (Source: Stockcharts)


Chart 4: DJIA's daily chart as at June 8, 2012 (Source: Stockcharts)


Chart 5: CAC's daily chart as at June 8, 2012 (Source: Stockcharts)


Chart 6: FTSE's daily chart as at June 8, 2012 (Source: Stockcharts)


Chart 7: DAX's daily chart as at June 8, 2012 (Source: Stockcharts)

Based on the above, I believe that we can begin to build our buy list of beaten down stocks. Once FBMKLCI had broken above the downtrend line, we can begin to slowly accumulate some of these stocks. To be sure, we should still be cautious in the current market given the uncertainty surrounding the Eurozone debt problem.