Technical Analysis - July 28 2008

S&P500 (1,258, last week 1,261 or -0.2% w.o.w)

The daily charts; especially the MACD continues to improve during last week. The daily DMI(+ and -) nearly crossed over last week but was separated again due to Thursday's +200 points fall. Short term players are in the market to trade on the early positive trend. The index may find support at 1,232 and 1,1200 while the resistance is at 1,300 and 1,330.

KLSE CI (1,142, last week 1,105 or +3.3% w.ow)

The daily MACD continues to remain on the uptrend although the DMI (+ and -) has not turned positive yet. The index worked extremely hard during last week to maintain the more than 30 points gained and managed to cross above the 200-day ema of 1,115. Short term players are in the market to trade on the early positive uptrend. The index is expected to trade between 1,050 and 1,190.

HangSeng (22,741, last week 21,874 or +3.9% w.o.w )

The daily charts especially the MACD continues to improve while the daily DMI (+ and -) has also shown a positive crossover during last week. The weekly indicators have not turned positive yet but it have since shown a slight hook up and improving. Short term players are in the market to trade on the early positive uptrend. Immediate support lines are at 21,900 and 22,300 while resistance are at 23,500 and 24,000.

Nikkei 225 (13,335, last week 12,804 or +4.1% w.ow)

The daily charts has turned positive during last week as evident by MACD and DMI(+ and -). For weekly charts, the MACD is still in a positive crossover. It was deteriorating on the earlier weeks but has now seems to start improving again. Short term players are in the market to trade on the early positive uptrend. The index is expected to trade between 12,500 to 14,000.

* Bloomberg: ANZ(4th largest Australian bank) says profit may decline 25% on bad debts provisions due to the weak local housing market. Its shares went down 11% to AUD15.74 at mid noon. Provision for bad debts for the current half year was AUD1.2b(last year 1st half: AUD980m). This bad news came after NAB reported higher than expected provisons for bad debts relating to US mortgages.

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* Bloomberg: According to Daiwa Asset Management, AUD rally is coming to an end. It predicted the currency to depreciate by 20% by 2009.

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* Bank Negara kept its OPR unchanged as it seems to be going after growth rather than inflation. Sure, the spike in inflation in June is caused by our own doing and that is why we are not too worried about inflation. Mind you, once inflation rate goes too high, it will be too stuborn to come down. So, our ringgit from now will be under "attack"? (word coined by Top Cat)

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* TheKoreaTimes: South Korea's current account swings to a net surplus in June of USD1.82b (May: deficit USD377.5m). This is the 1st surplus in 7 months as robust exports growth helped offset increased spending on overseas travel and imports. Did the Finance Minister got the figures all wrong as he has recently said that the Current Account figures(one of the few indicators mentioned) has worsened tremendously?