FKLI:- Is The Market Near To An End ? 22/3/2010

As I was saying last week I have not been too convinced by all these "recovery' type pf talks that have been flying around the markets these days. The Caribbean Club's crisis is still not resolved, and we will have to watch out for possible trouble from Spain, Portugal, Italy and many of those former Eastern Bloc countries, and there is UK which problem may become more prominent with their coming election. Last week I was watching a video recording of George Soros at the Hong Kong University, one of the hosts was trying to get him to comment about his positions on the pounds. Unlike his ex-partner Jim Rogers, Soros just kept quiet. And the lady host smiled understandably, I think she knows Soros is shorting the pounds again.

Last Monday, FKLI broke my stop and took out the prior long contracts. I have turned short when price closed below the upper Bollinger Band with confirmation from the Stochastic which has crossed down its 80's signal line. After holding out for the following 2 days, the MACD has also crossed down. The ADX has begun to hook downward which is confirming the prior upside has ended. Place stop at 1318.

You may want to add onto the shorts position when prices go below the middle Bollinger Band and Stochastic crossing down its 50's signal line.

The weekly chart continues to be uncertain as the Stochastic is positive and still rising while the MACD stays negative and has also hooked back down again. I would pay some attention on the MACD's behaviour as when the indicator was hooking up but has come back down again within a short time, it should be read as an extraordinary bearish sign. (or vice versa if they hook down but hook back up again) But of course what I say here is that you should pay attention to it BUT NOT to act on it yet. Prices remain above the upper Bollinger Band and the D+ is above D-, both are offering any new sell signal yet. The falling ADX and contradicting signal from rising Stochastic and falling MACD are telling us that this market may has been caught in another range bound situation.

So at this stage, act on the daily chart and sell, but only engage more positions when you secure a confirmation for the weekly chart. Meanwhile keep a sharp eye on Europe, if we have a multiple blowouts at the same time, there is no guarantee that they may not affect China, and if China goes, most of us will too.