StockWatch (Jul 09-13, 2012): PSEi, PX

 PSEi (Chart: Daily      Resistance: 5400         Support: 5287)

Last week, the index proved me wrong on all possible area patterns that I saw and instead pushed further upward creating a new high.  I am a little bit skeptic on the bullishness that the index is displaying now.   After large drops on previous weeks of trading, I was surprised to see the index creating a new record high and even gapping up on the start of last week’s trading.  I was expecting the index to meet strong resistance on approaching the previous high, especially because of the drop that happened on the second week of May.  But I guess a lot of traders are bullish on the market right now, hence the previous high being easily overtaken.

For next week, do observe the market, we can see that the RSI is now near overbought level with three weeks of upward movement for the index, it is possible that it would succumb to the resistance brought about by the RSI  near level 70.

Support is near 5287 which is the 10 day moving average for the index. For the past 3 weeks, the 10 day moving average has been providing support, so if the index moves below that, do sell a portion for the mean time.

PX (Chart: Daily         Resistance: 24.90        Support: 23.20)

PX is exhibiting characteristics of a symmetrical triangle.  This is supported by the diminishing volume as the triangle nears completion.   Right now, this stock is almost near 1/3 away from the formation of the triangle’s apex, so watch out for either a break out or break down of this stock in the coming weeks.

Upward target price for this stock is near P30, while downward target price is near P18.