As we earlier predicted, the PSEi would possibly drop to a downside of 2828.  This was already achieved last Friday as the index dropped to as low as 2826 before we saw a bit of a resilient market close at 2855.  I forgot to tell you that this is still a 50 something point drop.

If I were to apply a little Elliot Wave, then this current downtrend could only be the start of wave 2, a bearish wave.  So if that were the case, then we could probably see more downside to the index as it could retrace up to 2596, where the 260-day moving average is very near to, before we see the PSEi start recovering.

It’s very possible that the index could try to retest the resistance line of the downtrend, now pegged at around 2895.  Meaning it could only go up to that level before it starts going down again.  If we’re lucky, the PSEi could go as high as 2929, where the 130-day moving average is now located.

The MACD is showing us the downtrend has already gained momentum and it isn’t slowing down anytime soon.

Lighten the load if you don’t want to sink like the Titanic.

Recommendation: sell
Resistance: 2887