FKLI - Market Wants to Join In QE3 Party - 9/17/2012





The previous Friday's Doji was a warning that the market had gone undecided again, so I thought it would be a good idea to place  a stop on the prior day high plus 1-2 points. So if that was followed, then you would had got out on last Monday or latest on Thursday. Then last Friday was tricky when everybody reacted to America's QE3 and this market gapped up by 20+ points. Though the gap is so notoriously large, but still I went in and bought again as price went above the lower band with the Stochastic crossing up above its 20's signal line.

The ADX has begun to fall back which could mean the prior trend has stopped, even though it may just be temporarily. Both the DMI and MACD remain negative but their gap is fast closing. So if by the coming week price is able to maintain around here or continue to go up, then we may see a positive crossover on these 2 indicators.

The current trading plan is place stop below prior day low minus 1-2 points and go back in and sell again if price goes below prior day low.

The weekly chart's Stochastic, DMI and MACD are still negative but the Stochastic is still able to maintain above its 80's signal line. The ADX continues to fall which is confirming the end of the prior trend which was up and it is also confirming a lack of trend as it is also found below the 20's . The Japanese candlestick went down the middle band but managed to close back above it. The candlestick body is caught between the top and middle band which may be interpreted as another sign that the market may be side winding.

Now that most market players are so happy with the "infinitive" QE3 , maybe we will join in the party with a technical rebound before the next hell break loose scenario happens.