FKLI - Is This The End ? - 2/3/2014

 
The market took a clue from the Dow Jones previous week's large loss closing and gapped down on last Monday. But it did not do much ahead of a long Lunar New Year holiday. It also did not hit my stop placed at the bottom band. In the coming week, I will still retain my stop at the bottom band. The Stochastic is now below the oversold zone, but with the ADX rising, I would pay more attention to the MACD. The MACD is still falling and it is way below the zero signal line. So I would conclude this is already a bear cycle. The DMI stays negative with the D- rising, this is telling us that the sellers are still strong.

 
The weekly chart  deteriorates further as the Stochastic  continues to fall. It has just reached its 50's level. If it breaks below, it may be taken as another sell signal. The MACD is still falling, but it is still relatively "far" away from its zero signal line.  Price has closed marginally below the bottom band which means the final defense for the bull is gone. The DMI remains positive but it is fast losing ground, we may see it turning negative by the coming week. The ADX is still falling which is a solid confirmation of the prior trend has ended. But as it has now fallen below the 20's level, so we may see the coming weeks going into another sideway mode.

 
The monthly chart is also beginning to turn "dangerous" as the negative Stochastic barely stay above its 80's signal line. When if it crosses down, it would trigger an initial sell signal. The MACD may stays positive at present, but it looks like it may be having a negative crossdown by the coming month. Price has closed below the top band, something it last done on January ,2013. If by the coming month we can get a lower low of 1775 and a confirmation from the Stochastic, it would mean we have a sell signal at the monthly chart. This type of signal is usually more significant than those in the daily chart . And I would also want to bring your attention of the presence of a bearish divergence in this chart. Something that nobody should ignore. From the Elliot Wave point, I believe we may be at the end of the wave 5. If I read it correctly, this would mean we may be witnessing the end of our major bull market cycle and what follows should be some nasty bears clawing and mulling.

The market favors the bears more than ever. And if you had read all the Feng Shui masters forecasts for the year, you would have noted most of them are predicting the first half year would be problematic for Malaysia. I think the charts are also "predicting" similar scenarios.