PSEi Outlook for Dec. 13 – 17, 2010
Monday, December 13, 2010 9:59
The Philippine Stock Exchange Index (PSEi) has disappointed us once again. After it broke out of a falling wedge and being supported by the 50-day moving average, it suddenly gives way to close the week much lower than expected.
We expected that the 50MA would have held up the index at 4192 but the PSEi broke below that as many index issues were sold much lower than their previous levels. The MACD, on the other hand, is still rallying to show us a semblance of bullishness despite one month of retracement in November. But with the latest drop in the index, we should expect the MACD to adjust accordingly afterwards.
Some would see the latest correction as one of a few things; this is going to be a gloomy Christmas as prices keep falling and there would be less money to be made in the market. Others would see it as a blessing in disguise as it would be an opportunity for them to buy their stocks at more attractive prices. However we see things happening, we should always stick to our trading plans to avoid biting off more than we can chew in a very choppy market.
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