FKLI -  A Retracement Arrives - 1/26/2015

 

Last week I was thinking that the market may try to ride on a crude oil reversal. Though the reversal has  not materialize yet even with the death of the Saudi King, b ut FKLI seems to have found other excuse to rally upward again. Price has closed back above the top band on last Wednesday, the signal was confirmed by a positive Stochastic , MACD and DMI. I bought in again after Thursday price went high higher than the signal day high. Please take note that price has now closed above its recent fractal high of 1771.50.
Though the MACD has come back above the zero signal line, but the ADX remains below the 20s'. So with the Stochastic going into the overbought zone soon, I would remain cautious about the current rally. 


 

I has been noticing the DMI's extremity and warned of a possible retracement at the weekly chart . This retracement has arrived as price closed strongly above the bottom and middle band all within same week. With the Stochastic positive it has triggered an initial buy signal. The MACD is still negative but it has begun to turn around and we may see it becoming positive by the coming week. The DMI also remain negative but the D- has finally back off from its extremity and the D+ has begun to rise above 20's which is a strong indication that the buyers are returning with a vengeance. The ADX has begun to fall. This means the prior trend may has ended.
Fundamentally there is nothing much changes for Malaysian economy (which mean we are still screwed) . I think FKLI is anticipating an impending crude oil technical rebound and a sizable US Dollar retracement, hence the current rally Enjoy the ride but do not think for a moment we have resolved a crisis.