FKLI - Market Going Sideway ? - 8/25/2014


My stop was hit on last Thursday when price went below the prior day low. On the following price went down further and managed to hold above the middle band. So there is no new sell signal yet.
As at last Friday, the MACD ha begun to dip its direction but it remains positive. The Stochastic is still rising. The DMI stays negative and the D- has risen a bit but the ADX continues to fall and it is now at 20's. This could mean this market may be going into a listless market soon.

Since the recent high of 1875 failed to go higher than the last high of 1883.50 (30/7), so it would be interesting to see this is becoming a lower highs and lower lows situation.


 
At the weekly chart, though price went back up a bit but the indicators have not flash any complimentary signals. The MACD is till falling and its gap remains vast. The faster reacting Stochastic is also not reacting to the price revision as it is still falling. The DMI stays negative with the D+ hooking up some, but as the D+ is also below 20's level, I would not pay much attention to it yet. The ADX stays flat at 16's, this seems to confirming the falling ADX at the daily chart. This begins to look like a new listless market to me. If price is go below last week's low of 1855, it should flash a new sell signal.

Though the market may look like it is going into a sideway mode, the big picture  remains that of a big bear is looming around the corner.

FCPO - Even The Slightest Bullish Dream Is Completely Crushed - 8/18/2014

There are a few lessons to be learnt here. First there is the wrong interpretation of an oversold market with the Stochastic/RSI going down below 30's which is a mistake that many local chartists often make. As in the case here, the Stochastic has been 'oversold" since mid July, but it does not stop the market from going further down. Secondly, an "oversold" market does not mean that you can start "buying low", another common mistake that many stock analysts like to advocate. I use the ADX above the DMI as a more reliable confirmation of an oversold/overbought market which works most of the times BUT it does not mean it works ALL the time as the current situation demonstrates here. But I did not advocate "buy low", instead I insisted on the usual confirmed trading signal for a buy trade. I did not do any end of day trade on the previous Friday when price broke below its recent lows again because I earlier read the market as oversold. But since the ADX has begun to rise again since 8/8 again, I decided to try my luck and sold again on last Monday when price went further and went below 2231. I was not very confident of the trade and kept my stop at the entry price high immediately after entry and then to above the bottom band and now I have moved it to prior day high.

Whatever slight bullishness I have been reading in the past few weeks have now completed evaporated. It is the smallish bullish divergence is now been completely erased away.  But since the ADX is  still above the DMI and it is now at the extreme level of 44's,  I am still reading it as an oversold market . I would be very cautious of any shorts trade. Though the divergence at MACD is gone now, there is still one minor one at the Stochastic, so I would not get too carried away with the selling.

 
The weekly chart remains bearish as ever. The MACD continues to fall and the Stochastic is negative and stay below its 30's level. As long the Stochastic does not hook up and go back above its 30's level, do not harbor any foolish thoughts of a reversal. The DMI stays negative with the D- also as in the daily chart, it has now reached the 41's extreme level. So I would expect some form of consolidation and even some minor retracement from here. The ADX is still rising so the big trend is still intact. From the chart, I have marked out a horizontal line which show the current price has broken below a long term support of 2137's. This could be a really bad omen for the bull.

In the recent past, Jim Rogers and many market analysts were talking about higher prices for commodities which include food and oil. But it does not look like that is the case. Despite the wars in Syria, Iraq , Ukraine and many oil producing African nations, crude oil and natural gas price fail to go higher but instead has been falling. And now FCPO seems to be following that path. 

FKLI - Market Waits For Next Sell Signal ? - 8/18/2014

 
After the previous week's slam down, the market began to recover from the shock. I had placed my stop at the prior day high and it was taken out on last Tuesday. Price has now climbed back above the bottom band on last Wednesday and the Stochastic also has turned positive on the following day. I bought again on last Friday as price went higher than the signal day high. I will place my new stop at below the bottom band initially and if the market cannot go higher , I would adjust my stop to the prior day low.

The Stochastic has turned positive and been rising. The MACD has also turned positive as on last Friday, but it is still below its zero signal line. The DMI stays negative with the D- falling back from the extreme level of 44's. When either D+ or D- goes too extreme (which is beyond 40's), it is always prudent that you should tighten your stops. The ADX has turned flat which is telling us the prior trend is taking a rest.

At the moment, I would not say the selling is over unless I can see price closes back above its recent fractal highs of 1877 and 1884 which have became its resistances.

 
The weekly chart Japanese Candlestick closed back above the bottom band which is telling us the market is not willing to yield to the bear, at least not yet. But all the 3 indicators remain bearish as the Stochastic is still falling and now reached its 50's signal line. The MACD stays negative and is still falling. The DMI is also negative but the D- has dipped which reflects the sellers are getting jittery. The ADX stays flat which mean there is not yet a strong trend in the market. I would become bullish again when if price can close back above the top band.

As I last written here, I expect a sideway or an even a smallish rebound before the market starts to fall again. But for that to happen , price would need to go below 1833. For the time being, a sideway market would be more likely.

 FCPO - The Waiting Game - 8/11/2014


The previous week's up move quickly disintegrated as price failed to go higher. Price has been going nowhere for the whole week except on last Friday when it went lower. Both the MACD and Stochastic remain positive and the Stochastic continues to move upward towards its 20's signal line. I would need to see it crossing up above that level and at the same time for the price to close above its recent new fractal high of 2287. in order to call for a new buy. At the moment as the ADX has ticked up again, be careful that the sellers may decide to kick in another round of sell down, which is most probably their final round of game. Meanwhile I would just trade the intraday chart signals for the time being.

The weekly chart remains firmly in the bearish camp. The MACD continues to slide downward. The Stochastic may be inside the oversold zone but there is nothing to show that it is staging a rebound yet. Most important of all is that it has not formed any divergence, as that would mean the sellers remain brave hearted. The DMI stays negative with the ADX continues to rise, so the bearish trend stays intact.

The overall pictures remain almost the same as in the previous week : the weekly chart is firmly bearish with no signs of a possible reversal. The daily chart offers a chance of a possible reversal but it is not of a strong firm one yet. Maybe by the coming week, the market would give me a clearer picture.

FKLI - Is The Party Finally Over ? -8/11/2014
 

the previous week's sell signal did not make good as price failed to go lower than the signal day low. Instead price reversed and went back to the bottom band with the Stochastic turned positive again. I bought in on the next day when it went above the signal day high, but this trade turned out to be a bad one. Price collapsed again the following day and went below the bottom band again so I closed off the trade with a small loss. On last Thursday price continued to go lower below the bottom band and this time I have got a confirmation from the negative Stochastic , so I sold again the following day when price went lower than the signal day low. Friday's itself has yielded some respectable profit on the current trade as it lost 25+ points.

All the 3 indicators are now negative with the MACD going below its zero signal line. This is confirming a new bear cycle. The DMI is even more dramatic as the D- is now above 40's with the ADX rises above its 20's signal line. Both these 2 are telling us a strong trend has begun in this market.

The weekly chart continues to deteriorate as price has now closed below the bottom band. The Stochastic is still falling  and it is fast approaching its 50's signal line. If it crosses below there, it would trigger another sell signal. The MACD is tearing itself away from its moving average which indicating the strength of the sellings. The DMI continues to rise after turning negative last week and as the low went lower than the signal week's low, so this has confirmed another sell signal. Please take note that the ADX has now stopped falling and gone flat, this is a preliminary signal that the prior cycle has ended

As the market may has "over reacted' last Friday, so we may see some short term sideway or even some smallish correction in the coming week. But if the usual herd mentality starts to kick in, then we may see the market collapses further. But overall, as I have been writing here for the past few weeks, the market has been getting ready for a major correction as the signs were all over the charts. But I was not surprise as many of the market analysts were still singing songs of self elusions over the health of our nation's economy . As bank interests need to go up, property and stock market will have to come down, at least for the short term. It is NOT only about local property market, but this also applies to many international market especially those in UK, Australia and China. It is so sad that many people are still got suckered into those market. 

FCPO - Are The Sellers Getting Ready To Quit ? - 8/4/2014

The previous shorts trade was closed off on 25/7 when price went above the prior day high. I last commented here that I thought the sellers were faking it, prices hardly went further downward for the past 2 weeks . And on last Friday price went above the bottom band with the Stochastic turning positive again. Even the MACD has begun to turn around though it is still negative. I am looking forward for a stronger signal and that would be for the Stochastic to cross up above its 20's signal line or wait for the price to go above its recent fractal high of 2294. But I am getting more confident that the selling may be over because the ADX is now above the DMI and has gone flat for the past 2 days, this is a surer way to call the current situation an oversold market.  Another piece of evidence would be the D- has been falling and it is now below the 30's. 

 
The weekly chart remains bearish  as the MACD continues to fall and it is below the zero signal line which mean the bear is dominating the market. The Stochastic stays inside the oversold area but it has not turned positive yet. The DMI is also staying negative but the D- has begun to fall. This mean the sellers are letting go its grip a little bit. The ADX continues to rise , so I have little to feel bullish yet. The only item that may bring some hope to the bull is the weekly Japanese Candlestick which is a long lower shadow. When this comes out in a falling market, it could be interpreted as a bullish reversal signal. Since it is the sole and a"possible" signal against all other sell signals, so I would just wait and see first.

Though the weekly chart remains bearish, there are already some subtle signals at the daily chart that a new technical rebound is on its way and when it comes, it could be a strong one as there is a bullish divergence formed at all the 3 indicators. I suspect this will play right into the El Nino and the Ebola virus scares story. But a word of warning here :- since the MACD is still relatively "far" from its zero signal line, but I would still keep my stops tight as the sellers may still want to play their last hand before surrendering.

FKLI - Armageddon Coming ? - 8/4/2014


The previous short trade was closed  off when price went above the bottom band on 25/7.A new buy signal was flashed on 30/7 when price went above the bottom band with the Stochastic went positive. But the signal was not good when it failed my filter trade as the signal day high was not met. Instead price collapsed below the bottom ban again on the next day. Price went further down and the Stochastic has turned negative again. So this is another new sell signal so I would sell again on the coming Monday if price goes below the signal day low of 1852.

The MACD stays negative and it is below the zero signal line which is firmly in the bear territory. The DMI remains negative and the D- has gone above the 30's level, this is confirming the strength of the sellers. The ADX has begun to rise and it has now gone above the 20's signal line, this is also confirming there is a trend in the market.

 
The weekly chart has been fast deteriorating as price is now firmly below the top and middle band. Both the MACD ans Stochastic have  turned negative. The DMI has just followed suit, this is the first time it has turned negative since mid September , 2013. If price can go below 1852, it would trigger another sell signal. Though almost all the sell signals are already in place or coming into place, the ADX remains flat and it is still below the 20's signal line, I would need to see this indicator to confirm a new trend in the market.

The market may has begun to act out on the bearish divergences formed at the daily and weekly charts, something that I have been warning here for the past several weeks. Of course the market is putting the blame to the new banking crisis in the South Europe, but then the EU crisis has never really gone away. Remember all the crisis that have been coming out from from EU were from the "small boys" (Greece, Portugal, Spain, Ireland, Cyprus  etc). I am still waiting for the big boys like France and Italy to implode. And when if that is going to happen , then the market can really get panicky.