KCPO:- It is buy again for the short term 26/4/2010

The weekly chart ADX has begun falling and now is below its 20's which is confirming the absence of trend in this market. Though both the Stochastic and the MACD remain negative, price has initially fallen below the lower Bollinger Band which would make a great short signal, but it managed to closed back up above it. Since the weekly chart ADX is telling us this market is "un-tradable", so we would have to concentrate on the daily chart.

As almost always in a listless market, there will be many false breakups or breakdowns. Last week, the market gaped down below its recent range as marked out by 2 horizontal lines but with no follow through action. And on last Friday, the market again reversed and went back and closed above the lower Bollinger Band by which you should closed off short positions. During the breakdown on last Monday, the D- did not break above its prior peak, thus offering no complimentary confirmation on the down move.

As at present, the immediate situation tends to put back the favor to the bulls as the Stochastic has crossed up and the MACD has also followed suit. For the more bravehearted traders, you may engage some long positions and keep 2494 as stop. As the ADX has begun to drop, indicating the prior down cycle may has ended, but the D- still dominate over the D+, you would want to be careful with long trades.

Since there are contradicting readings in the daily and weekly chart, so you should keep your trading time parameter  short term. Pay attention to the Stochastic, be ever ready to take profit or cut loss when it turns. We would have to wait again to see whether this will develop into something big or would this be just another small of those 3-5 days kind of trades.