PSEi Weekly Chart
PSEi (Chart: Daily Resistance: 2425-2400 Support: 2289/2100)
The support line from Jan 2008 was tested for the 5th time last week and it was not able to contain the index’s downward move. The index, punched thru the support line moving downwards up to the lowest at 2289. Looking at the weekly chart, we can see that there was a support at that level, which was the 260-MA on the weekly chart at 2300. However, this may just be a temporary support for the index as judging from the break down from the channel, there is a possibility that the index could still move lower towards the downward channel’s target price near 2100. Last Friday’s upward move may just be a short rally as there was no volume to support the upward movement. Still trading strategy would be to keep liquid. No signs of reversal can be seen from the charts.
Note: There are a lot of stocks that are very much oversold, be careful on trading these stocks, as any upward move might just be a short rally from being very oversold. If you are to trade these kinds of stocks, keep an eye on your stops as the market is still very bearish.
LR (Chart: Daily Resistance: 2.80 Support: 2.24/2.06)
LR seems to be a promising stock to follow. The stock had a large spread and large volume last Friday. Also worth noting is the price which is now above the 3 moving averages. This denotes strength for the stock. Looking also at the MACD, the MACD is now above the zero line and now poised to cross above the signal line, both signs also indicate strength in the stock. But how long can this strength last is another question that may not have a definite answer. As of now, resistance is at 2.80, which is the previous high. We can assume for now that the strength that we are seeing can take this stock from 2.60 to 2.80, beyond that is still a wait and see. I am more inclined to call that 2.80 will be a strong resistance, judging from the RSI which is now near overbought.
RLC (Chart: Daily Resistance: 6.30-6.60/ 9.50 Support: 6.0)
RLC is one of those stocks that are very much oversold. What caught my attention for this stock is the unusual large volume last Friday which may translate to a strong support at 6.00. Resistance is currently at 6.30-6.60 which is the gap down formed last Thursday. If you are to trade this stock, keep track of your stops. It is possible that the stock may reach beyond 8.00, based only from the 38.2% fib retracement, which is at 8.30.
DGTL (Chart: Daily Resistance: 1.46 Support: 1.24)Comparing DGTL with the PSEi, DGTL seems to be in a better position than the index. As we can see, the recent downward movement of the stock is not really part of a bearish cycle, but more part of the consolidation that is happening for this stock. Looking at the chart, we can see that the MACD has been oscillating near the zero line which indicates consolidation and it is also evident on the price action. Currently there is an upcoming support at 1.24; it would be good if the stock is able to stay above this support line from Sept 2004. Otherwise, if the stock moves lower than the support line, then this might probably be the end of the consolidation phase for this stock and may move to a bearish phase. But judging again from the RSI which is very much oversold, it is highly probable that the support at 1.24 may hold.
2 comments:
I think we are going to see a short-term rally monday and tuesday. But long-term the market is going down.Times are tuff for everyone except the super rich. They expect to spend more this year according to CNBC. Eli Broad said this is the worst economy since WWII. I will tell you why @
www.theinvestingspeculator.com
Don't be fooled by short term rallies. The worst is still ahead of us. In my view a major collapse can occur suddenly
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