PSEi daily 21September2007

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PSEi = 3423.73 (-0.5%)

PSEi closed at 2423.73 lower than its open at 3428.56.

Is the recent high of the rally (previous trading day's high of 3446.69) already achieved the top?

The answer will be known in the coming trading week :)

We can only assume that the movement of the price is likely to be supported by both the 130MA (3406) and 32MA (3272). Both of which were resistances prior to being crossed by the price movement.

A recent high at 3411.75 may also be considered as a psychological support.

Now for the resistance. The 65MA (2461.61) is acting as the resistance. I can only hope that the bullishness continues and drives us past this moving average.

So what can we expect for the coming trading week? I think there is still some momentum for the bulls (as can be seen if we chart the relative strength index of PSEi). MACD, the lagging indicator, which has been above zero for the last 2 trading days confirms this bullishness. There is some risk for consolidation or even bearishness, given that the faster leading indicator: Stochastic, is above the 80 level which may signal PSEi as being overbought.

Taking all these and the news that US markets may extend Fed honeymoon (after the 0.5 rate cut); we could expect gains but please be careful of weakness of the PSEi as profit taking might be nearby.

Good luck to all traders!

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