Monday, August 15, 2011

KLCI Downtrend To Continue

The fall in Dow Jones Industrial Average shows a change in market trend and economic conditions.  Big money from hedge funds, institution and fund managers withdrew in droves, causing great volatility in the market.

Looking at the charts of KLCI, it looks very similar to the drop in 2008 when the Lehman Brothers collapse brought about a big drop in stock market worldwide. 

The index is trying to find a bottom and it looks like a rebound may materialize.  However, it will face resistance at around 1500 level.  Judging from the magnitude of the decline, the bears are still in control and the strategy should be sell on strength as the market is poised to move lower.

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