KCPO:- Slow Drift To Lower - 5/7/2010

Last week saw another round of drifting down again. Both the Stochastic and MACD have turned negative and price went below the lower Bollinger Band. With  MACD  below its zero signal line, you should be more bearish biased.

The ADX starts to rise again but it is still above both the D+ and D-, this is usually taken as an oversold signal. So I remain unimpressed but if you had sold the market with the break below the lower band, then keep a stop at 2367. Otherwise you should just sit around and watch out for some clearer signals.

The weekly chart seems to telling us something else. The MACD has gone below its zero signal line which is usually a more confirming bearish signal. Prices stay below the lower Bollinger Band and the ADX has finally begun to rise. All seems to be telling us a big bear is in formation ! The only discomforting item is the Stochastic which is now at 9's. I would like to see a continuing rising ADX to offset the oversold Stochastic in order to call this a big bear move.

So with the weekly chart calling for a bigger bear while the daily chart is on a short term sell. But I cannot read anything particular too bearish on both the charts, so I would sell on the short term and keep stops tight. And let's see whether we can get some clearer signals on this market by the coming weeks.

I am also pondering on KCPO's  reactions to weaker USD and crude oil which traditionally KCPO tends to follow their direction.