Chart 1: FBMKLCI's daily chart as at May 12, 2015_12.30am (Source: ShareInvestor.com)
Over the past few months, we have been adopted a constructive outlook towards the market after the recovery that began in early January. This tinted view of the market is partly a function of a financial market that is flushed with liquidity, courtesy of various central banks around the world that have to prop up their respective economy. The investors has been so accustomed to this condition, which is not unlike a frog who has gotten used to the lukewarm water in a slow boiling pot. Once in a while, we must look at the numbers and the charts to see exactly where we are.
If you look at the monthly chart for FBMKLCI, you will see that the 10-month SMA line has just cut below the 21-month SMA line. The MACD line has not
Chart 2: FBMKLCI's monthly chart as at May 12, 2015_12.30am (Source: ShareInvestor.com)
The same reading is also present for FBM70.
Chart 3: FBM70s monthly chart as at May 12, 2015_12.30am (Source: ShareInvestor.com)
With the prevailing uncertain condition, we must reduce our trading activities in the market.
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