KCPO - More Powers To The Bulls - 12/31/2012

The past week confirmed another buy signal as price went above 2410. I added onto my long positions. And I am placing my stop at 2410, somewhere below the top band. The ADX finally begin to rise and just crossed above the falling D-. Some traders take this as another buy signal.  The MACD has just crossed above its zero signal line which is more reassuring for the bulls. So is the expanding D+. The Stochastic has now gone above 80's so we may see some consolidation or minor retracement around here. 

 

 The weekly chart's ADX has finally stopped rising and it is now above the DMI, which may be signaling an oversold market and  the end of the prior trend. Price broke higher than last week's high and this comes with a newly positive MACD and a Stochastic crossing above its 20's signal line. These are confirming a new buy signal. Since there is only a divergence found at the Stochastic and not in the MACD, so I will only consider this as a strong technical rebound and not a major bull cycle. But the intial target is 2700's and we may even see a retest of the 3,000's, it is going to be a highly profitable trade.

 

 The monthly chart's Stochastic has gone into the oversold zone and I would want to see if there is a possible new cycle from here. The MACD remains negative but prices seem to find a strong support 2220's where it has not been to penetrate down for the past 3 months, but neither can it goes higher. So we are having a clear consolidation here, 2 things will eventually happen after this:- the market can either collapse through the support or it starts to go higher. Though the Stochastic may be at the oversold zone, but no one can guarantee it would collapse further. I would watchout for any breach of the support for the downside and the bottom band of 2695 for the upside.

I was monitoring most of the comments in the media on this market for the past one month and almost every one of them has been bearish on this market while every competent technical analyst would have been wetting in their pants with bullishness. But if you have followed the chart and entered long position at around 2300's, there would already a minimum of 150+ points profit to your position and I am quite sure we may see more to come.