Technical Analysis - June 16 2008

S&P500 Chart (1,360, last week 1,361 or -0.00% w.o.w)

The daily charts continues to weakens. For weekly charts, MACD has slowed down on positive cross over. The MACD Hist is positive. The DMI (+ & -) has weakened drastically and now showing negative crossover and the ADX is at 18. The daily charts needs to pull all stops otherwise the Index is destined to fall further. The index is just about 1,360 which is the crucial minimum level to be within the uptrend channel created since March 14 2008. (Note: For the last 5 sessions, the index was below the 1,360 level). The index has a big task and major headwind ahead. The index is expected to trade between 1,330 and 1,400

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KLSE CI (1,229, last week 1,249 or - 1.6% w.ow)

The daily charts continues to weakens. The weekly MACD which nearly crossed over at -23 are now showing downward pressure again. The index needs to quickly form support at 1,210 and 1,220 levels in the next couple of weeks if it intends to start a brand new uptrend channel again but this channel will be at a much slower pace compared to the March uptrend channel earlier. If the index goes below 1,210, hugh selling is anticipated. The index is expected to trade between 1,210 and 1,250

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HangSeng (22,592, last week 24,402 or - 7.4% w.o.w )

The daily charts has worsened tremendously during the week. The weekly DMI (+ & -) is at a negative hook down and the ADX is at 21.The weekly MACD has just a day ago turned negative and as a result MACD Hist has also followed suit. The Index need to stay above 22,333 to avoid falling into the downtrend channel. Immediate support is at 22,333 and 21,600 while resistance is at 23,600.

Nikkei 225 (13,974, last week 14,489 or -3.5% w.ow)

The daily charts deteriorated during the week and the daily MACD and MACD Hist has a negative cross over 4 days ago. For weekly charts, MACD is still in a positive crossover and improved to -185 and the MACD Hist is positive. The DMI (+ & -) however, has a hook down while the ADX has weakened at 23. The index is bunching up closely on the uptrend line and is expected to trade on uptrend between 13,800 to 14,600. If 13,800 is broken, the immediate support is at 13,500.

* UN Chief: Saudi plans to increase oil production by 200,000 barrels per day or increase in production by 2% next month. Do you think it is enough to trigger a sell down on oil? The 300,000 barrels per day increase in May was largely ignored by the market last month.

* The Standard: "Shanghai Composite Index fell 17% or 591 points over 8 consecutive days to close at 2,868 on Friday. Fund flows show money flowed out China and HK Funds last week of USD1.3b. The money leaked out into Japan, Global equities and US funds as reported by data provider EPFR Global".

* HK plans to develop a crude oil futures market aimed at setting a benchmark that would give Asian consumers and importers some bargaining power against Western counterparts. Currently Asian uses mainly Dubai futures as a reference. Note: Gold futures will be launched in the 2nd half of 2008 in HK.

* BNM: Malaysia may use interest rate as a tool to tame inflation if there is a "generalised" increase in prices. BNM's overnight policy rate remains at 3.5% and is up for a review on July 25.

* FinanceAsia.com's recent poll of Malaysia's best managed companies has concluded that Public Bank Bhd is the best company in Malaysia under catergories: management, corporate governance, investors relations and commitment to a strong dividend policy. Amongst the other winners are Maybank, CIMB Group, DiGi, Media Prima, Airasia, Masteel, Deleum, PetGas, IOI and BAT. Mr Gerard Nathan(Tanjong) is named the best CFO in Malaysia.