FBMKLCI Futures - Daily Message 11 Jan 2011

Bias turned down yesterday but a close above 1564 likely restore upward bias. Nonetheless, the longer term uptrend still intact.
Support is expected at recent lows of 1557, 1550 and then 1540.
While sellers may come at 1564, 1569 and thereafter Monday's high of 1580.
Sentiment was neutral as futures was priced about fair.
21 day moving average is now at 1525.

Crude Palm Oil Futures - Extended Consolidation?

Price is on short term downtrend though uptrend in the longer term is still intact. There is yet a clear sign of change in trend in the longer term basis despite the weak Friday close (chart 3). But we do note few negative signals which price has to overcome if indeed uptrend is still good.

The short term trend looks weak as: 1) 14-day uptrend line is broken (chart1); 2) 50-period moving average is broken and is pointing down (chart 2); and 3) price fail to close above early week low of 3790.

Nonetheless the longer term picture is still positive as it above weekly moving average and trendline while none of the support levels broken yet. In fact, if the 35 day cycle still plays out, we may find intermediate term bottom soon as we are on day 33. It might also see coinciding bottom in RSI.

Meanwhile sign of weakness evident are: 1) Failure to break above 3900 and closing below 3800 psychological level and 2) Inability of beanoil to close above RM1.80 for 3 weeks now.

Therefore, the 3800 likely be the important level to watch going forward, a close above it signals upward bias is still present while further close below it may see increase in selling pressure. A strong market should also see beanoil trading above 1.80.

A side note, the fall in Dec export is not dissimilar to what happened last year.

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FBMKLCI Futures - Daily Message 5 Jan 2011

FKLI bias stays up and close above 1550 should keep bias intact.
FKLI is in uncharted territory, so expect resistance at every round figures.
Support may come at 1540, 1530 and early Dec high of 1523.
Sentiment was somewhat weak as futures was priced cheap. But firmer market today may see upbeat sentiment returning.
21 day moving average is now at 1514.

FBMKLCI Futures - Daily Message 4 Jan 2011

FKLI bias is up again after printing all time high and a close above 1540 should keep bias intact.
Resistance is intraday high of 1546 and possibly psychological 1550.
Support is now 1530 and then early Dec high of 1523. Further down, consolidation low of 1513.
Sentiment stayed buoyant as futures again was priced rich.
21 day moving average is now at 1512.

Hang Seng Futures - New Upcycle?

We believe that Hang Seng has probably made an intermediate term bottom and a new cycle has begun within a longer term uptrend. On a longer term basis, Hang Seng is still on an uptrend as no clear signal of top occurred so far (chart 2 & 3). 

Hang Seng may have bottomed in late Dec and the next cycle is probably up on several reasons:

1) Sep to Dec bottom was 75 days, which is not too far from prior cycles of 70 and 68;

2) Price is still above the medium term uptrend (chart 2) and still above 20 week moving average (chart 3);

3) Price cannot close below 23000 support convincingly on weekly basis;

4) Price cannot fall further after breaking below 23000 with 2 long black candles on 15 Dec; and

5) Two dragonfly dojis a week apart with 22300 as bottom.

If so, price should continue to move higher and must close above 23700, which kept price low in the past month and a half. Next target would be Nov high of 25000. However, expect selling to continue should price close below 22300.

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FBMKLCI Futures - New Upcycle?

Price has likely entered into a new cycle, within a longer term uptrend. We believe long term trend have yet to turn down as:

1) FKLI yet to chart lower low since May, it is not even below Oct low of 1470

2) Still above its 20 week moving average (chart 3) and above medium term trendline (chart 2)

3) Yet to make significant bottom since May

At the same time, price maybe into the 9th day of new cycle with bottom at Dec 20 as:

1) 20 Dec bottom is 59 days after Sep bottom, slightly above 2x prior cycle;

2) 20 Dec bottom found support right at 6 month uptrendline; and

3) 21 day moving average starts moving higher.

Nonetheless, the 1530 resistance has yet to broken convincingly. Therefore it needs to be broken to confirm the new up-cycle. Do note too, further positive signs are evident. The first is sentiment been overwhelmingly positive in the past 2 weeks while Ringgit strengthened further which usually coincide with stronger KLCI. Also, in 08 FKLI closed above 1450 for only 2 weeks whereas it has been above the level for 15 weeks now while the midcaps continue to print higher close.

So if all come into play, price should close above 08 intraday high of 1536 soon and further 10 days of upward movement is possible. It be great to if breadth confirm the move. But a close below 1485 and definitely below 1470 should see increase in selling pressure.

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FBMKLCI Futures - Daily Message 3 Jan 2011

FKLI 1527 close gives a hint of weakness and it need to close back above 1530 resistatnce to keep upward bias intact. Otherwise, bias may turn sideways to down.
Further resistance is at 1540, Thrusday's high and then intraday all time high of 1546.
Supports are at early Dec high of 1523 and then prior consolidation low of 1513. Minor support may come at 1518.
Sentiment nontheless stayed positive as futures was again at premium to cash. Should sentiment has influence over price, it has to close above 1530 to keep it going.
21 day moving average is at 1509