Ploy is back to grace us with her thoughts on the markets. She delves into the SET, Asia-Pac, DJIA, SET Sectors, USD/THB and Gold.

Enjoy!

The world has been so peaceful lately and the SET has been gradually climbing up the ladders.

Most of the charts today are updated from last week’s charts.

The SET has breached above the barriers at 1,088-1,093 last week and 1,102.77 yesterday. It is now volatile, with nearby supports at 1,090 and 1,080-1,075. The outlook will turn negative if it falls below 1,055-1,050, which you can use as the cut-back signal to decrease your portfolio exposure. If the SET can regain strength, it will have to test the gap barrier at 1,122, which was created last August.

Given the strengthening Baht, the SET may be more likely to head up higher, at least until the Baht/Dollar exchange rate tests the support at 30.68 and/or 30.44. I reiterate that the downside gap in the Bath/Dollar exchange rate is as low as 30.26-30.25, which is possible unless the support at 30.44 can hold.

 

However, the US dollar index seems to hold well above the X-support given last week. That may be the reason why the rally has slowed down since late last week.  The breakouts above 79.54 and 80.50 will be a threat to the global equity markets. These are the indicators we have to keep our eyes on this week.

 

The Dow Jones is still stalling at the same barrier at 12,876. The breakout above this barrier will be the momentum that pulls the SET and other equity markets up. However, the outlook will turn negative if the Dow Jones falls below the red line in the chart, which can also be used as the stoploss line for those who trade in the Dow Jones. The stoploss signal is now around 12,700-12630, which can be used this week and has to be revised up next week according to the rising slope.

 

Also, notice the chart of Asia Pacific region below. The equity markets in the Asia Pacific region still has a potential upside gap, meaning it may continue the rally for a longer while.

On the risk side, notice the charts below. Some sectors in the SET have limited upside gap. The Construction Materials is testing its long-term resistance, which began in 1995. This resistance is extremely strong and if the sector can’t breach above this resistance, the downside gap will be large.

The SET’s bellwethers also have limited upside gap. The Energy sector has approximately 12.90% upside and the Bank sector approximately 15%. If these strong, long-term resistances can’t be breached, the downside gaps are also large. I present these charts to you so that you may be aware of where you are trading.

 

Updating the Gold, LME gold spot price is still in the same channel I drew last week, and despite its current volatility within the channel, it may zigzag up to test $1,791-1,795 and key barrier at $1,802.60. This week’s support is at $1,710-1,700.

 

In sum, the SET may have an upside while the Dow Jones is still testing its key barrier and the US Dollar index is trying to rebound from its X-support. Some sectors in the SET are reaching their key long-term resistances and upside gaps are limited. Cut back partly if the SET falls below 1,055-1,050.

Thank you Ploy! You can contact her directly @ ploy@thaicapitalist.com