StockWatch (May 04-08, 2009): PSEi

PSEi (Chart: Daily Resistance: 2120/2170 Support: 2057)

The index had a sell down for 2 days but was again able to recoup the loses on Thursday. Although it is not evident in the chart, the volume on Thursday’s recoup was less than the volume on the April 24 rally. The volume last Thursday was just bloated by block sales. Volume is still diminishing on every time the market is able to bouce back which I believe is not a very good sign.

Also, something not that evident in the chart is the MACD crossing below the signal line. For MACD followers, this means a signal to sell for the mean time, which I believe is what should be done.

The index also broke the standing support line (orange line) from March 2009. The recoup last Thursday just fell short of moving past that line so this is something to watchout for the coming week.

Overall, I still advise caution in trading or for the risk averse stay on the sidelines for now. Watch out for upward movements with low or diminishing volume