FKLI - Trouble May Be Around The Corner -11/25/2013

The market flashed a new buy signal on last Tuesday when price stays above the bottom band with the Stochastic crossing above its 20's level. I bought on the next day when price went above the signal day high. But thing already did not look too well as price opened high but closed low.  And then on the following day price went below prior day low which I closed off my positions with some losses.

Though the Stochastic stays positive but the MACD has turned down again and remain negative. The real story teller here is the ADX, it has been falling and it is last at 16's. So we have contradicting indicators and low and falling ADX, all sum up to a listless market. Please take note that price closed below the bottom band on last Friday trading, if it continues to stay there or fall further, the Stochastic should flash a new sell signal soon. You should also pay attention to the MACD which may be crossing below its zero signal line. I often used that line as a demarcation for the bulls/bears. Once we have both the indicators in agreement, then we may see a new round of selling.

 
The weekly chart remains almost the same as the past week. The Stochastic is already inside the overbought zone and has begun to tilt its head. The MACD stays negative and begins to fall. Price is unable to close above the top band so I cannot say anything positive about it. I would continue to pay attention to the middle band as the next support. If price is to close below that level, then we may see a new round of selling. The DMI remains positive but the ADX continues to fall. It is now at 17's. This is telling us there is no new trend in the market yet.

Both the daily and weekly chart is confirming a listless market. So if you are entering any new trade, do make sure you keep a tight stop. The US market may be getting ready to retrace some , so traders may make use of it as an excuse to sell down our market. Meanwhile France seems to be more and more likely to be the next candidate to get a kick in the face. If it is so, you must be aware of France's economy is much much bigger than those of Greece, Portugal or Spain. The threat to the financial market will be much more challenging than the others.