StockWatch (May 10-14, 2010): PSEi

PSEi (Chart: Daily Resistance: 3315 Support: 3060)

The index took a nose dive the previous week, forming a black candle with large spread that occurred last Wed. Trading last Friday broke support at 3132, but was able to close above that level.

The resistance at 3315, which is the long standing resistance from June 2008, is still intact

As seen on the chart, it looks like we have a small double top formation with the breakdown occurring last Friday when the index opened lower. The projected downward target level for the index is at 2940.

As of current the index has support at 3060 as evidenced by the white candle that formed on Friday’s trading. But what is unsure is how long this support can withstand the bearish environment with the MACD opening downwards and its impending crossing below the center line.

For the coming week, expect a sideways to downward movement. Sell for the time being. Those who were able to catch up some stocks last Friday, be prepared to sell when the market starts to dip once again.