FKLI:- "We Are Different" ? - Hell No, We Certainly Are Not - 8/22/2011

Last week we did get a very smallish technical rebound as predicted here 2 weeks ago, but it quickly fizzled out on Friday when market was quickly grasped in fear again. As price has gone below the lower Bollinger Band I would get ready to go shorts again when I can next get a confirming signal from the Stochastic.

The MACD remains negative and hook back down again , so is the DMI where the D- (selling powers)has begun to rise. Both of these are confirming the bears are on the move again. I would pay a lot of attention of the ADX as it, too has started to rise again. This is confirming the bearish trend has restarted. If new shorts are engaged, place stop at 1482.

 

The weekly chart maintains its bearishness as price stays below the lower Bollinger Band while the Stochastic crosses down its 50's signal line. I usually take this crossing down as a more confirming bearish signal. The falling MACD may soon do a similar crossing down when it goes below its zero signal line. The most encouraging sign for the bears is the continuing rising ADX. Please note that it is now crossing up the falling D+, this should be taken as another sell signal.

Fundamentally, US may still be holding their ground, we certainly cannot say the same for EU. The world may be witnessing the final cracking up of Fortress Europe as France (the Malaysia of EU who always pretend they are the leader of EU) is fast becoming the next hit.

As for Malaysia, for the past few weeks we continue to see more political leaders, fund managers, bankers, property players and other "experts' coming out to reassure the nation that we are "prepared" and "we are different". Unfortunately when I first got active in trading before the 1998 financial crisis, I was also getting a lot of "we are different" talks before we get whacked. Regardless what the "experts" are saying , I take a look  at FKLI monthly chart yesterday and regrettably report that our market certainly does NOT look "we are different" . In fact, I am of the opinion that this may just be the BEGINNING OF THE END.  

 

The chart is attached herewith, pay attention to the overbought Stochastic which is crossing down now; the negative MACD; prices crossing down below the SAR Parabolic and the upper Bollinger Band. This is the first time that price has gone below the upper band since end February 2008. If by the end of this month, price is to close below prior fractal low (marked out with a horizontal line) , then we should be getting the final nail to the coffin.