Second- & third-liners could be due for correction

If one were to look at the KLCI & the activity in our stock market for the past 2 months, one would notice that the play has shifted to the second- & third-liners stocks. This is pretty much borne out by the 3 daily charts (for FBM Smallcap, 2nd Board & Mesdaq) appended below. Due to the recent weakness in oversea stock markets, all 3 indices had violated their immediate uptrend line. Only FBM Smallcap has recovered above its uptrend line (but it has violated this uptrend line again today). The present weakness in all these indices is signaling an imminent correction amongst the second- & third-liners stocks.


Chart 1: FBM Smallcap's daily chart as at July 31 (courtesy of Quickcharts)



Chart 2: 2nd Board's daily chart as at July 31 (courtesy of Quickcharts)



Chart 3: Mesdaq's daily chart as at July 31 (courtesy of Quickcharts)