StockWatch (June 9-13, 2008): PSEi

PSEi (Chart: Daily Resistance: 2900 Support: 2712)

The index moved further downwards to the low of 2717. It is possible that support may be available at this level, since the previous low was at 2712. If this becomes a trough, it is interesting to note that the RSI and MACD is still creating higher lows. By the MACD alone, we could infer that there is accumulation going on at this stage as the MACD has lately been creating higher lows. The MACD is still consolidating near the zero line, but this might oscillate more before moving beyond the zero line. Since it seems that we are in a consolidation phase, trading strategy would be to trade the range. It is still too early for this stage, but do watch out for reversal patterns like double/triple bottoms, of inverse head and shoulders, it is during consolidation that these area patterns begins to form. As of current we can see a lot of candidates for double bottoms, but it is still too early and these area patterns might evolve into another pattern later on.