FKLI - A Technical Rebound So Don't Get Too Carried Away -10/27/2014

 
The market continues to retrace and hit the bottom band on last Monday which effectivel closed off my prior shorts positions. The market continued to improve and triggered a new buy signal as price stays above the bottom band with the Stochastic crossing above its 20's signal line so I bought in again. As I mentioned here last week, though I do not believe the correction is over yet, but I would still have to obey the new signal and bought.
The MACD has already crossed up and turned positive. The Stochastic continues to rise toward the 50's signal line. The DMI remains negative with the D- continues to fall from its extremity. This is confirming that the sellers have been closing out their positions. The D+ has been rising from below the 20's , this confirms the buyers' strength. The ADX has begun to fall as it confirms the end of the prior trend. Price continues to rise and may go test the middle band next. I would watch 1826 resistance level as it has been tested several times in the recent past. If that level can be taken out, then this market may be shaking off the bearish cycle again.


 
The weekly chart's extreme D- forewarned a correction last week. Price has stopped falling and instead has made a 24 points retracement but it has not able to close back above the bottom band. The Stochastic has turned positive while the MACD continues to fall. The ADX is still rising so it means the trend is still intact.
The short term chart is favoring a upward move but the longer time parameter charts seem to be confirming bigger bear coming. With the presence of bearish divergences written all over them, I continue to biased in a super bear market thinking over any bullish one. Fundamentally I fear our economy may be heading for a stagflation and I think the charts are merely reflecting what is about to hit us.