KCPO:- Will This  Be A Short Term Rebound ?- 3/7/2011

Last week I thought this market may has reached a temporary bottom and advised that you should take profit. The market actually began to rebound from last Monday. I bought the market again when price went above the lower Bollinger Band and the Stochastic turned positive last Wednesday. Depend of your risk appetite, place stop at 3540 or 3560 .

The daily ADX has turned down. This is telling us the prior selling has  at least temporarily ceased. But I would take the current move to be of one of those smallish short term move because the lack of trend, so I would keep my stop tight.

                      


The weekly chart's Stochastic has finally crossed down below its 80's signal line, offering an initial sell signal. Though the MACD continues to fall, price did not close below its middle band which is the 20 periods moving average. With the ADX continues to fall, I would think the market could be caught in a side way situation for a while before doing its next course of clear directional move.

I would continue to monitor the FX market intensely for possible hints to most commodities market's next direction. You should pay attention to any abrupt falls in major FX pairs like the AUD and CAD. These 2 are usually considered to closely tied to the commodities market.