Our market ended last week on a slightly bullish note. MACD turned up
and crossed above the signal line. The -DMI appears to have peaked and
turned back down while +DMI appears to have bottomed and turned back up.
While ADX is still at a high, this may drop back in line with a
declining -DMI. Lastly, stochastic is beginning to climb up from its
oversold position. All in all, our market is poised for a rebound. Alas,
that mildly positive set-up may not come to pass...
Chart 1: FBMKLCI's daily chart as at August 23, 2019 (Source: Malaysiastock.biz)
Thanks to the extremely stable genius in Washington,
the global economy is in a greater state of uncertainty because he
wanted an easy-to-win trade war. Sometimes some people shouldn't get
what they wish for. After China decided to up the stake in the trade war
last Friday, US markets swooned. DJIA dropped 623 points. This adds to
the fear that the US economy will be in a recession a few months down
the road after the dreaded inverted yield curve flashed on August 14 and
appeared again on August 23 (here).
Has DJIA made a slanting triple top? Is it tracing out an inverted
head-&-shoulders at the top of the market? Right now, it is wishful
to ask for DJIA to climb up to 27500 in order to form the right shoulder
of an inverted head-&-shoulders formation.
Chart 2: DJIA's daily chart as at August 23, 2019 (Source: Stockcharts.com)
The global markets are now held ransom by events that are out of our control. We have to concentrate on stock fundamentals and invest cautiously according to our plan. Good luck!
http://nexttrade.blogspot.com/2019/08/market-outlook-as-at-aug-23-2019.html
