FKLI - 15/6/09 - Continue to defy gravity

Like I said for the past 2 weeks - I remain cautious on the daily chart's readings as the market has still failed to take out/erase out the bearish divergence at the MACD. Another interesting item I note from the daily chart is the ADX which has been stepping downward despite the market continues to reach higher highs. That is usually telling us the big hands are already doing something nasty behind all this bullishness.


The weekly chart as per previous week is of a completely different picture. The MACD is above the zero signal line and the gap between itself and its moving average is widening, indicating the trend is getting stronger. This is also been confirmed by the rising weekly ADX. Prices also remain above the upper Bollinger Band, so I see no reason to sound any alert as far the weekly chart is concerned.

I have been looking over many of the stock charts over the past weeks, one thing is confirmed:- most of the penny stocks/lousy fundamentals stocks/ potential 176's candidate stocks are all raving to explode upside and will run or have already started to run till your jaw drops. But most of the big stocks have none of their smaller brothers' bullish setup. I consider most of the big stocks are merely doing a bear cycle technical rebound. So you should trade those "small boys" instead of the so called 'blue chips". Comrade Deng once said: "stocks that go up are good stocks; stocks that do not go up are bad stocks" or something like that.

As for FKLI, I repeat:- unless the bearish divergence is taken out, I keep my stops tight. You should place it at 1070. Meanwhile just ride the trend as long it is still intact. The next target would be at 1110 and 1160.