Hang Seng Futures - Testing 24500

A new price cycle probably has begun and may likely end the 6 months sideway movement. Price is still moving higher in the shorter within a longer term uptrend.

Looking at the price movement, price may have made a bottom on 17 March. Assuming the cycle started in Dec, the cycle is 62 days long. Though it is the shortest of prior cycle, the combined cycle is about the same 138 (70+68) and 137 (75+62), increasing plausibility of Mar 17 bottom.

As such, given cycle length of about 60 day, the current cycle likely end the 6 month impasse. An upcycle should see price trading above 25000 by around early May while a downcycle likely see failure of breaking 25000 and then trading below 22000.

At the same time, there are few positive: 1) Violation of 5 month downtrend; 2) 3 long white candles on the weekly chart; and 3) Good upward momentum. This should lend support for upcycle but again, price has to respond accordingly.

Meanwhile, in the very short term, price is trading within the blue channel (chart 1). It wouldn’t be a bad idea to close long position on break of the 3 week channel. Based on 62% Fibonacci retracement, a price retracement of up to 23000 is still positive for the uptrend. Again, expect higher price if 24500 broken.

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FBMKLCI Futures - Daily Message 11 April 2011

FKLI bias has turned down though a close above 1555 likely turn bias up again. Note too that price is just above psychological 1550 support level. Price has to close below 1550 to keep bias down.
Further down, expect support at 1547 and then prior highs of 1540 and 1530. 
Resistance is now 1555 and thereafter the uncovered gap of January, the area of 1562 - 1564.
DO notice that cash has not traded below Thrusday low, look for both cash and futures to trade in sync again today.
The longer term trend is up but price has to close above 1580 to confirm it.
Sentiment turned downcast as futures was priced at discount to cash.
The 21 day moving average is now at 1520.

FBMKLCI Futures - Daily Message 8 April 2011

FKLI bias stays up and a close above 1564 should keep bias intact.
Again, expect selling at uncovered Jan gap of 1562-1564 and thereafter the all time high of 1580.
Support is now the prior resistance of 1555. Further down expect resistance at the area 1550-1547 and prior highs of 1540 and 1530.
The longer term trend is up but price has to close above 1580 to confirm it.
Sentiment is neutral to weak as futures was priced at slight discount to cash.
The 21 day moving average is now at 1518.

FBMKLCI Futures - Daily Message 7 April 2011

FKLI bias turns up after the close above morning high, but it needs to close above 1555 to keep bias intact.

Further up, expect resistance at uncovered Jan gap of 1562-1564 and thereafter all time high of 1580.

Support is now the area of 1550-1547 and then prior highs of 1540 and 1530.

The longer term trend is up but it has to close above 1580 to confirm it.

Sentiment was neutral as futures was priced about fair.

The 21 day moving average is now at 1516.

FBMKLCI Futures - Daily Message 6 April 2011

FKLI bias is neutral after the mixed closed. The close below morning low is weak but the close right at 1550 is supportive.
Resistance is still 1555, the low of Jan consolidation, which price has to close above and then the gap of 1562-1564.
After area of 1550 - 1547, expect supports at prior highs of 1540 and 1530.
The longer term trend is up but price has to close above 1580 to confirm it.
Sentiment was slightly subdued as futures was price at discount to cash.
The 21 day moving average is now at 1514.

FBMKLCI Futures - Daily Message 5 April 2011

FKLI bias stays up and a higher close should keep bias intact.
Following succesful close above 1555 resistance, expect selling at uncovered gap of 1562-1564 and thereafter 1570 and then all time high of 1580.
Support is now todays low of 1547, and then prior highs of 1540 and 1530.
The longer term trend is up and price has to close above 1580 to confirm it.
Sentiment turned neutral as futures was price about fair.
The 21 day moving average is at 1513.

FBMKLCI Futures - daily Message 4 April 2011

FKLI bias stays up and a close above 1550 should keep bias intact.
Light resistance is expected at 1555, the low point of Jan consolidation and the uncovered gap of 1562 - 1564.
Support is now the previous high of 1540 and then another prior high of 1530.
The longer term trend is up but has to close above 1580 to confirm it.
Sentiment is somewhat cautious as futures was priced at discount to cash.
The 21 day moving average is now at 1512.