StockWatch (Dec 13-17, 2010): PSEi

PSEi (Chart: Daily Resistance: 4235 Support: 4049/3953)

The index encountered resistance upon reaching the previous high of 4221 and have started to move south again. As of current, the 65 day MA is supporting the index, but if this does not hold, the next support would be at 4049, then at 3953 which is the previous low. One thing to observe for the coming week is the possibility of an inverted head-and-shoulder formation if the support at 4049 holds and the index started moving north again. The neck line of the formation is at 4235, a break above that with large value turnover may propel the index to new high at 4500.

StockWatch (Dec 06-10, 2010): PSEi

PSEi (Chart: Daily Resistance: 4194/4221 Support: 3953)

The index has bounced from the lows of the RSI 30. Trading last Thursday created a white candle that broke both the immediate resistance line and the resistance line from the start of the downward movement. It also broke through the 65 day MA as well. This is a positive thing for the index as it was able to break through 3 resistance levels. However, there was no follow through with the trading action last Friday. It would have been great if the trading last Friday was again a white candle with considerable spread, but instead the index opened and closed on almost the same level. This indicates a deadlock between bullish and bearish traders. So for next week it is still a wait-and-see who would win and break the impasse.

Considering the Elliott wave counting, I am hoping that this recent break of the 3 resistance levels would be the end of the C wave. But I am also not sure whether the C wave was completed in the first place, because text book length of C wave is at least the same size as wave A, so I was expecting the C wave to go further down toward 3850 level, which did not happen