16 Feb 2009
16 February 2009
14 February 2009
13 February 2009
12 February 2009
11 February 2009
10 February 2009
09 February 2009
06 February 2009
05 February 2009
04 February 2009
4 Feb 2009
Although ADL shows sign of weakness the index is still hovering within the 1700 window. Slightly divergence shows between STI vs ADL. There is risk of breaking down in term of STI and ADL which causes a strong downward pressure.
When looking at BDI, we see strong rebound since last year. We are only at about 10% of the 2008 peak which may show more upside. Breaking out from flag channel (one month period) suggested stronger upside move. However, we are anticipating some throw back before BDI goes into another level.
A fail of breaking out from 50MA, USDJPY turns out of favor. Short term wise, USDJPY break down from flag since 22 Jan 2009 which is a bad sign. A good thing is there are quite a number of tail formed when USDJPY tested the recent trendline support suggested the immediate downside is more resilience.
03 February 2009
02 February 2009
01 February 2009
23 January 2009
22 January 2009
21 January 2009
20 January 2009
19 January 2009
16 January 2009
15 January 2009
14 January 2009
13 January 2009
12 January 2009
09 January 2009
08 January 2009
07 January 2009
06 January 2009
05 January 2009
02 January 2009
31 December 2008
30 December 2008
29 December 2008
26 December 2008
25 December 2008
22 December 2008
19 December 2008
18 December 2008
17 December 2008
11 December 2008
10 December 2008
Double Bottom, how true?
Complete Double bottom is formed from two valleys and a breakout of neckline.
Within 10 years STI trend, there are two major uptrends namely (1998 - 2000) and (2003 - 2007). In between these two uptrends, there are few minor uptrend which are (early 1998 - mid 1998), (end 2001 - 2002), (Feb 2008 - June 2008). All of these major and minor uptrend are built from Double Bottom.
How true is this? How long does these uptrend lasted?
Below are few charts extracted from Yahoo. First was the recovery from 1997 market crash. A swift double bottom formed 'V' formation of swift recovery. Second bottom formed 10% above first bottom break out after double bottom.
The recovery doesn't last very long (but strong enough to allow certain group of players regain their capital with 'bankrupt' small chips). The real bottom came after several months later ended with a formation of another double bottom. Second bottom is about 15% above to first bottom.
Then market was hit by 2000 Tech Bubble and it was hit harder when 911 came. However, the recovery from 911 was fast too with Double Bottom. The second bottom is about 7-8% above first bottom.
Real bottom only came after May 2003 when market rallied off the ground until year 2007. The Double Bottom formation is exclusively coupled with inverse H&S formation. Then STI began to mark the starting of Bull market. The second bottom is about the same level as first bottom.
After Oct year 2007 market was beaten down by Subprime (and a lot of stuffs which created from Domino effect. Basically Subprime just some scapegoat of US financial mess). The short recovery was spotted on Feb 2008 when market formed 'Double Bottom'.
The question is should we consider Feb 2008 a double bottom? I will regard it as Double Bottom failed to extend and the period of hanging at the neckline makes me believe it is another distribution stage.
Second bottom off about 3% below first bottom. Surprise to me market would able to rally to June 2008. Basically, this is the time a lot of dressing and distributing is going on.
And now, another round of Double Bottom likely to form. Will STI able to form another double bottom? Or break down? Not until neck line has been breached, we are unsure the formation of major trend.
I see if Double Bottom is formed from this formation, the rally won't last long to become a Bull market. The Double Bottom need to be extended to form better base. Otherwise it would become a short rally like early 1998. Anyway, it is because of early 1998, many of us got back what we have lost on 1997. So, yes or not, depends on you.
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