It may be conflicting considering the situation but we’d like to wish everyone a Happy New Year!

So what’s in store for the PSEi for the start of the year?  Unfortunately, it looks like it’s going to be more of the same.  The only reason we say this is because the trend still hasn’t been broken so we should expect more downside until the trend reverses.  We hope that would be soon.

Anyway, as far as what we see is concerned, the index has been moving sideways since November. What we want to see is a break on the upside of the symmetrical triangle that is being formed where currently our resistance is at 1917.  We would have an upside target of 2271 should the index breakout, but we should expect some resistance at 2046 as the 65-day moving average is there.  However, on the other side, the support is at 1839 and we would have a downside target of 1484 if we would breakdown once again.

The chances of us breaking down is greater at this point as not only is the index nearer the support, but the MACD lines have started to turn southward again.  Hopefully this is only temporary and we would see some rallies in January.

Again, we should be vigilant to whenever the PSEi is ready to move higher and let’s look out for bargains.

Recommendation: Buy selectively
Resistance: 1917
Support: 1839