This blog is committed to the serious study and valid understanding of technical analysis and its objective application to stock selection, risk management and execution primarily in the context of trading stocks listed in the Philippine Stock Exchange (PSE).

Thursday, April 17, 2008

PSEi 4/17/08 PHILIPPINE STOCK MARKET TECHNICAL ANALYSIS

OUTLOOK
The local index attempts to mimic the Dow's overnight performance but fails miserably in terms of magnitude and momentum. It advances fractionally higher +0.64% but closes weak at the lows. Below average turnover and a NFB of -0.5B reveal foreign selling on strength that flies in the face of whatever optimism the local investors can muster. Today, the cumulative NFB falls to a 13-day low. But weak or not, the PSEi is on its 2nd day higher after finding minor support at 2900 and this technically conforms with an objective definition of a swing reversal. We should remember that this is happening within the context of a larger declining intermediate trend and for the meantime should be viewed as a temporary upside correction. The charts show no cause for us to revise any of the major trends as of yet. It will be reasonable to expect the downtrendline to cut down any near term rally.

PRICE AND TURNOVER
Close: 2,940.48 * Change: +18.74 +(0.64%) * Value: 2,213,986,000

MARKET BREADTH
Net Adv Issues: +39 * Net Up Volume: +124,168,950 * Net Foreign Buying: -452,850,149

TECHNICAL ANALYSIS
Major consolidation * Intermediate downtrend * Short term downtrend * Support 2750 * Resistance 3050 * Broken short term trendline * Price objective 2500

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