Where will KLCI go next?
There are many reasons why I am having a bearish bias on KLCI, and along with that many stocks that have seen remarkable rebound ranging from 50-100% since the panic meltdown back in March. Among them, the potential second wave of covid cases, the unrealistic optimism of retailer or what Keynes likes to say irrational exuberance, the multiplier effect of low consumption and higher unemployment rate.
Going back to the chart, KLCI has to make a decision to break above 1429 for further upside, or break below 1352 to finally confirm another leg down, which potentially would send us down to March’s low to retest a double bottom. Since there is no main catalyst in Malaysia to decide the direction, I will be monitoring the US market very closely as an indicator of where our market is going next. If we are moving up, I will continue trading until the music stops. However most of my trading profit will be directed to build a short position via put warrant on KLCI.
Trade safe guys.
Going back to the chart, KLCI has to make a decision to break above 1429 for further upside, or break below 1352 to finally confirm another leg down, which potentially would send us down to March’s low to retest a double bottom. Since there is no main catalyst in Malaysia to decide the direction, I will be monitoring the US market very closely as an indicator of where our market is going next. If we are moving up, I will continue trading until the music stops. However most of my trading profit will be directed to build a short position via put warrant on KLCI.
Trade safe guys.
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