Tuesday, October 24, 2017

Technical View On The KLCI As At Oct 24 2017

The recent sell down of the KLCI component stocks since mid September has some damage to the technical chart of KLCI. Let's take a look:

Daily Chart





Chart Pattern
There was a violation of the 6 month Double Top chart pattern at 1750 on 17/10/2017. Currently, we are waiting for a confirmation which is a retracement below 1750 level.

Trend Line
It has also violated the one year trend line at 1768 on 28/9/2017.

Moving Averages
At 1736, it is currently below the 20day, 50day, 100day and the 200 day MAs. 

GMMA
The red GMMA lines have crossed below the green lines. The red lines are facing down while the green lines are horizontal indicating short term speculators are selling while the long term investors are still holding.

The violation of the double top if confirmed the next target would be 1710.


The Monthly Chart


In terms of the monthly chart, we can see the long term bullish trend is still intact. Hence, it would be crucial for the KLCI to hold at above 1730 for now.



Technical Indicators as at Oct 24 2017

As at 24/10/2017 

Sector
20 Day MA
50 Day MA
100 Day MA
200 Day MA
Construction
Below 
Below
 Below
Below 
Consumer
Above  
Above  
Above  
 Above
Finance
Below
Below
Below
Above 
Ind-Product
Above  
Above 
Above  
Above  
Industrial
Above  
Below 
Below
Below  
Mining
Below 
Above 
Above  
Above  
Plantation
Below 
Above
Above
Below
Properties
Below 
Below  
Below 
Below
Technology
Above 
Above  
Above  
Above  
Trading/ Services
 Below 
Below 
Below  
Below 

Technical Indicator:



20 Day MA: Short term<1month br="" nbsp="">
50Day MA: Medium Term 1-3months
100Day MA: Medium Term 3-6months
200Day MA: Long Term > 6months

Bearish Sectors Are:


Construction, Finance, Industrial, Properties, Trading/Services

Bullish Sectors Are: 

Consumer, Industrial Products, Mining, Technology






Tuesday, September 5, 2017

Technical Indicators For KLCI as at 05/09/2017

As at 5/9/2017 

Sector
20 Day MA
50 Day MA
100 Day MA
200 Day MA
Construction
Below 
Below
 Below
Above 
Consumer
Below
Below
Below 
 Above
Finance
Below
Below
Above 
Above 
Ind-Product
Above  
Above 
Above  
Above  
Industrial
Below 
Below 
Below
Below  
Mining
Above 
Above 
Above  
Above  
Plantation
Above
Below
Below
Below
Properties
Below 
Below  
Below 
Above  
Technology
Above 
Above  
Above  
Above  
Trading/ Services
 Above 
Above 
Below  
Above  

Technical Indicator:

20 Day MA: Short term<1month br="" nbsp="">
50Day MA: Medium Term 1-3months
100Day MA: Medium Term 3-6months
200Day MA: Long Term > 6months

Sectors that have improved are (have turned above the indicators since last month):
1. Plantation:                 Above 20 Day
2. Trading/Services:     Above 50 Day MA


Sector/s that has/have deteriorated (have turned below the indicators since last month):

1. Construction: Below 100 Day MA
2.  Consumer: Below 20 Day, 50 Day & 100 Day MA3. Finance: Below 20 Day, 50 Day4. Industrial: Below 100 Day, 200 Day MA


Saturday, August 5, 2017

Technical Indicators For KLCI as at 4/8/2017

As at 4/8/2017 

Sector
20 Day MA
50 Day MA
100 Day MA
200 Day MA
Construction
Below 
Below
 Above
Above 
Consumer
Above
Above
Above 
 Above
Finance
Above
Above
Above 
Above 
Ind-Product
Above  
Above 
Above  
Above  
Industrial
Below 
Below 
Above 
Above  
Mining
Above 
Above 
Above  
Above  
Plantation
Below
Below
Below
Below
Properties
Below 
Below  
Below 
Above  
Technology
Above 
Above  
Above  
Above  
Trading/ Services
 Above 
Below 
Below  
Above  

Technical Indicator:

20 Day MA: Short term<1month div="">
50Day MA: Medium Term 1-3months
100Day MA: Medium Term 3-6months
200Day MA: Long Term > 6months

Sectors that have improved are:
1. Consumer:                 KLCI  above 20 Day and 50 Day MA
2. Finance:                     KLCI above 20 Day MA
3. Industrial Products: KLCI above 20Day and 50Day MA
4. Industrial:                 KLCI above 100 Day MA
5. Trading/Services:     KLCI above 20 Day MA


Sector/s that has/have deteriorated:
1. Properties: KLCI below 100 Day MA

Sunday, July 9, 2017

Technical Indicators For The Bursa Malaysia Sectors


As at 7/7/2017 

Sector
20 Day MA
50 Day MA
100 Day MA
200 Day MA
Construction
Below 
Below
 Above
Above 
Consumer
Below
Below
Above 
 Above
Finance
Below 
Above
Above 
Above 
Ind-Product
Below  
Below 
Above  
Above  
Industrial
Below 
Below 
Below  
Above  
Mining
Above 
Above 
Above  
Above  
Plantation
Below
Below
Below
Below
Properties
Below 
Below  
Above  
Above  
Technology
Above 
Above  
Above  
Above  
Trading/ Services
 Below 
Below 
Below  
Above  

Technical Indicator:

20 Day MA: Short term <1month div="">
50Day MA: Medium Term 1-3months
100Day MA: Medium Term 3-6months
200Day MA: Long Term > 6months

Thursday, June 29, 2017

Phillips Curve and The Central Banks

The recent market sell off followed by comments made by ECB Mario Draghi spooked investors worldwide. The market has misinterpreted his comments to be 'hawkish' rather then 'dovish'. The next day, markets went up again!  He did mentioned about being prudence, but at the same time he was also concern about the Euro zone inflation rate being less than 2%. (The ideal is 2% - 3%.)

Here comes the famous economic theory "Phillips Curve". Many economists think that it is not relevant in today's world but the US and ECB think the theory is still valid and they have been making economic decisions mainly on the unemployment rate and the inflation rate.

According to Phillips Curve theory, economic growth should come with rising inflation and falling unemployment rate as shown in the diagram below.


Hence, the US Fed Yellen and ECB Draghi have been tracking these 2 parameters closely to decide whether or not to raise interest rates. What we see in the US and the Euro zone are falling unemployment rate, but at the same time, the inflation rates have been low too due to the supply side factors such as low commodities prices, cheaper raw material, and rising productivity due to technology. Hence, the low inflation rate may cause the US Fed and the ECB to defer raising the interest rate to normalisation. The current interest rate for the US and the Euro zone are 1.25% and 0% respectively, this leaves little room for the monetary policy makers to play should there be another financial crisis. 

How about fiscal policy? Since 2008, the whole world have been pumping their economies with billions and trillions worth of constructions and government spending. For example, the government debt to GDP ratio for Japan was 250% while the US was 106% according to Trading Economics. 



In terms of Fiscal and monetary policies, there just aren't enough rooms to maneuver.

Many people are anticipating another financial crisis soon as we have seen one in 1974, 1985, 1997, 2008, if looking at this sequence, the next one could be in this decade?

Or may be not? I will be sharing on this topic on this Sunday July 2 2pm - 2:45pm at KLCC Convention Center POPULAR Bookfest Hall 5. Free full day workshop voucher to be given with the purchase of my new book.