The PSEI has ascended to a high of 3.7% from the start of the year, hitting 7,500 for 3 straight trading days. The biggest question now is will the rally continue or will the market take profits and a correction may follow? The 7,500range would be interesting to watch to see if the market goes further or not.
Looking at the chart below all indicators are still pointing to a more bullish bias and the long term uptrend line is still intact. The strong support for the market is currently pegged at 7,000 range.
If we zoom in further, we could assume that a relatively short term resistance is at the 7,500 range and a short term support at around 7,360.
If the PSEI breaksout from 7,500 the market can continue to go to a high 7,600. However if it fails to break 7,500 successfully, the market could drop to the nearest support at 7,360.
If 7,360 does not hold, the next support could be at 7,260.
Another possible scenario is that the market does not break 7,500 and just moves and ranges from either 7,260 to 7,500 or 7,360 to 7,500. Eitherway, your game plan should be to follow your conviction, strategy and stick to your buying and selling rules.
I’ll be sending more updates on selected stocks that you have requested over the next few days. I hope that this post helps on your trading and investing!
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*Charts via chart nexus