Dear Readers,
How was your trades over the week? have you taken profit? if not you better do so!
Following from last week analysis of DJI and SSE, i concluded that the risk was not at the acceptable level due to anticipation of major hurdles in coming weeks. Now lets take a look at the chart after one week.
Yesterday (7Dec2010) a "beautiful" shorting star was formed in DJI at 11450 level ie at the previous high on 5nov2010. This is the prelude of a Double Top is in the making. So, if you are short term trader be extra cautious!
Ok lets take a look at SSE. SSE is not going anywhere! Have been moving side-way for a month with volume retreating. Obviously, SSE is awaiting for orders and directive from the market. The phenomenon of i wait for you and you wait for me will persist until clear direction is apparent. Usual year end holiday season is just around the corner. Do not expect any impressive ending of equity market.
I would say high chance of DJI & SSE lackluster in coming weeks before the year 2010 ended.
Huh, look at KLCI this morning, chalking up impressively, +11 points. i have a feeling kindly of like, some pro are pushing up the market to distribute to you. ok! well you could continue to blame why such thing happen in our market. Probably this is against your believe that market is efficient as all information should be reflected in the market. But i think generally, this phenomenon is common in all "small market" in emerging country. Small market is easily "move" by some "big" hand, which hinder the efficient market hypothesis. Imaging this, KLCI market cap at the moment is around RM1 Trillion (=RM1,000 Billion). Just EPF alone its fund size stand at Rm300 billion. If you take into consideration Khazanah, PNB, Tabung Haji and so on what is so difficult to maneuver the market. furthermore they all listen to one boss ie PM.
So be cautious of the invisible hand.
Cheers Happy Trading.
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