Market Outlook as at May 6, 2015

Market Outlook as at May 6, 2015

 FBMKLCI has convincingly broken below its intermediate uptrend line, SS at 1820 this morning (see Chart 1). The next support would be the horizontal line at 1805 (not far from the psychological 1800 mark) as well as the overcome downtrend line, RR.


Chart 1: FBMKLCI's daily chart as at May 6, 2015_9.30am (Source: ShareInvestor.com)

We see the same breakout in FBMEMAS, which broke its intermediate uptrend line, SS at 12600 last Friday (see Chart 2). 


 Chart 2: FBMEMAS's daily chart as at May 6, 2015_9.30am (Source: ShareInvestor.com)

Over the past  1-2 weeks, we have seen Mumbai's BSE & Shanghai's SSEC breaking their respective uptrend lines. This development could herald a temporary pause in the rally for many Asian markets for the next few weeks.


Chart 3: BSE's daily chart as at May 5, 2015 (Source: Stockcharts.com)

 
Chart 4: SSEC's daily chart as at May 5, 2015 (Source: Stockcharts.com) 

Is this simply the operation of the old maxim, Sell in May and Go Away? Or, is it something more dangerous, possibly the end of the 6-years bull run? Until the dusk has settled, we should exercise careful discretion in our trading activities.

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