StockWatch (Apr 27-30, 2009): PSEi

PSEi (Chart: Daily Resistance: 2105/2150 Support: 2050/1920)

The index in my opinion is still not in a good shape, even with the recent drop that happened Monday last week. The RSI is still near overbought and the divergence is still intact as of Friday last week. For the past weeks, volume seems to be diminishing in the index. The recoup that happens after the short drop is usually acompanied with volume, which is good, however, volume seems to be diminishing each time the recoup happens.

Another observation for the index is that there seems to be a rising wedge that is forming. However, it’s a little bit awkward to see a rising wedge at this point since the somewhat prevailing trend is sideways and rising wedges are usually seen on a downward trending market. So the rising wedge is still questionable at this point. But I would still advise caution in trading the market or better yet just observe the market for the mean time if the volume still continues to diminish by next week.