Charts – Weekly

Ploy has put together a plethora of charts and information, she’s still hesitant on the market as whole and lists out key factors to look for.

SET made a low at 1,101.59 last week.

Although there have been rebound for 3 consecutive trading days, and the SET made a beautiful rebound from the support at 1,100, I am still bearish.

Some of you may have started buying now that the sky seems so bright and there seems to be sunny days ahead in the SET. Well, buying is applicable, if you really, really, need to buy.

Based on the hourly chart below, the SET has just shrugged off the short-term downward channel (those black lines). That means, you can buy for a small amount. Why? Because, there are still many resistances waiting to be tests. Resistances are at 1,147-1,150 and 1,160-1,165 (shown in above chart as well). My suggestion here is that, you can buy and add to the position, step-by-step. Buy some more on breakout above 1,147-1,150. Add more to that on breakout above 1,160. If the SET can successfully breach above 1,160-1,165, short-term outlook will become more bullish, and the index may head up to re-test its strong, weekly resistance at 1,260-1,280. That’s 100-point, or approximately 10%, upside. Stoploss line is still at 1,100.

 

The reason I urge you not to hurriedly rush in is that, there is simply no enough reason to buy. Surely, most stocks look really cheap now, but what if you can buy at even cheaper price?

The Bank index made a low at 415.47, roughly around the support at 416-412, given last week. Although there seems to be a rebound this week, resistances that have yet to be breached are at 440 and 448-450. If the rebound can’t make it that far, it may head down to re-test the same support line, revised up to 420-419.

Just to have something to watch as more signals:-

BBL must breach above this relatively strong barrier at 181.50-182.50 in order to regain strength and may head up to test its previous High at 194. Supports for BBL are at 174.75 and 173. Buying BBL is applicable on breakout above 182.50 and if you can accept the stoploss line at 173. BBL is considered a stock with easy signal to trade along at the moment.

SCB is a little weaker than BBL. It must breach above the resistance at 140 and 142.50 in order to head up to 146.50 and its previous High at 156. Support is at 132.50-132. Again, trading SCB requires simple strategy: buy on breakout above 140 and stoploss line is at 132.  

Also, the Energy index doesn’t show a very positive sign. I am still very much worried about our big guy. The resistances to be breach are at 19,228 // 19,400-19,500 and 20,000. The downside at 17,500-17,400 is possible if the supports at 18,600 and 18,250 can’t hold the index up.

 

 While the Dow Jones is moving within a small range, you may watch its resistances at 12,576 and 12,615. Its supports are at 12,310 and 11,735. The possible downside at 10,900-10,800, given in my previous comment, must be kept in mind.

The DAX, which has dropped since hitting its strong weekly resistance, seems to make an attempt to rebound, based on the daily chart. Yet, resistances that it must breach vary from 6,446 / 6,589 / 6,630. The supports are at 6,150 and 6,120. I won’t be very bullish on the Euro zone until the DAX index can breach above the given resistances. Otherwise, its rebound will be only a rebound that is followed by a downward zigzag.

 

Is the SET really stronger than others? The answer is difficult to gauge. I compared the SET with Dow Jones and DAX index, and the results I got are somewhat mixed. The SET is poised to out-perform the Dow Jones (which means it will rise relatively more than Dow Jones’s rise, and it will fall relatively less than Dow Jones’s fall.). However, compared to DAX, the signal is somewhat mixed and requires more time to be observed. That’s why I won’t rush into buying the SET, yet.

 

The sudden fall in the US dollar index may explain the short-term rise in the equity markets. But, the US dollar index may be forming a rebound. If the index can breach above its hourly resistance at 82.16, it may continue to rebound to test 82.60-82.80. If the US dollar index fails to form a rebound, it may head down to regain strength around its lower supports which are now at 81.85 / 81.60 / 81.50. The fall in the US dollar index will push the equity markets up higher, but eventually, when it tests one of its supports, the likelihood that the equity markets will continue being bullish may be less. In weekly chart, the US dollar index still looks positive, and upside is still seen. 

 

In sum, while there may be short-term rebound in the SET, we still have to wait and see whether the SET can weather through the storms. The trading strategy for now is that, you may add to your portfolio step-by-step, that is, on breakouts above each of SET’s resistances. On breakout above 1,160-1,165, it is possible that the SET may regain strength and become more bullish, heading toward 1,260-1,280. In that case, we will have 10% upside to trade along before face the same old strong weekly resistance. Stoploss line is still maintained at 1,100.

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