Technical Analysis - January 5 2009

S&P500 (932, last week 873 or +6.8% w.o.w )

The index worked extremely hard during the week with a hefty rise of almost 7%. As a result, the daily indicators continued to be in the positive last week. The index is now above the daily 50-day ema. For the weekly readings, the indicators are improving slowly and the MACD had a positive crossover but the weekly Parabolic SAR is not positive yet. The uptrend will be enforced further if the daily/weekly ADX trend and DMIs (+ve and –ve) were to turn bullish too, so far still moving towards it only. Support is around 890 and resistance at 980.

KLSE CI (894, last week 867 or +3.1% w.ow)

The daily indicators continued to improve further during the week especially during the last day of trading for the week. The index went a step higher and close the week sitting above the daily 50-day ema despite the index under pressure as evident from the high daily stochastic oscillator. The daily indicators of Parabolic SAR, ADX trend and DMI (+ve and –ve) are still positive. The weekly charts have improved and the MACD and Parabolic SAR are still positive. The uptrend will be enforced further if the weekly ADX trend and DMIs (+ve and –ve) were to turn bullish too, so far still moving towards it only. The index is expected to trade between 850 and 930.

HangSeng (15,043, last week 14,184 or +6.06% w.o.w )

What a turnaround by the index again. Despite trending lower the week before, the index jumped 6% and is now above the daily 50-day ema . Despite this, the daily MACD and MACD Histogram and Parabolic SAR are still slightly negative. The weekly charts are doing well, especially the MACD and MACD Histogram which are bullish. The weekly Parabolic SAR is also positive. Support is seen at 14,000 and resistance at 15,800.

Nikkei 225 (8,860, last week 8,740 or +1.37% w.ow)

The daily indicators continued to improve further during the week. The index seems to be heading towards the daily 50-day ema of around 8,900 level. The DMI indicators have just turned positive. However, the daily/weekly stochastic oscillator is at a high level which requires the index to correct soon. The weekly charts are improving. The Parabolic SAR has just turned bullish too. The index is expected to trade between 8,500 and 9,500.

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* World condemns Israel's offensive in Gaza Strip.

* Bloomberg: Fed officials endorse "big stimulus" to pull economy out of recession.

* Bloomberg: Obama said to push for USD300b tax cuts in economic stimulus package.

* The Standard: HK investors of Lehman minibonds may have to pay around 20% of any money they receive to their US lawyers.