Friday, 9 March 2007. 1,188.83 (+1.77)

(Source: biz.thestar.com.my/marketwatch)

Good number to end a not so good trading day. The KLCI closed up 1.77points today after reaching a high of 1,201.45 points. According to analysts, it is important for the 1,200 points resistance to be broken convincingly in order for the rally to continue. The intraday graph above shows that selling pressure emerged from the early morning and pushed the KLCI lower to end the day jus marginally higher.

(Source: biz.thestar.com.my/marketwatch)

For those of you who are familiar with candlesticks, you will understand the significance of the gravestone doji formed by today's trade. This doji after the recent uptrend indicates a failed rally and a possible reversal of trend. From my personal analysis, this shows that the the upward movement over the past 3 days was a technical rebound and possible a wave 'B' in a minor bear wave. This needs further confirmation from Monday's trade, but this means that the KLCI is likely to trend lower on Monday which may lead the KLCI to decline past the 1,086 level achieved during the week.

This could also be the formation of Wave '2' in the overall movement. Note that this analysis is based on my basic knowledge of Candlesticks and Elliot Wave Theory. From the charts above, my guess is next Monday will see a downward movement in the KLCI unless something happens that will push the KLCI past the all important 1,200 point level convincingly.

Patimas

(Source: Kenwealth.com)

Patimas closed down RM0.01 today at RM0.15 with 5.7m shares done. It should be noted that 4.7m shares were done at RM0.155 and RM0.16 and only 26,000 shares were done at RM0.15. It seems that the last trade of the day of 9,000 shares was done at RM0.15 which depressed the price slightly to RM0.15. It seems there are buyers around this level. Volume is shrinking which shows less tug of war between buyers and sellers. The price seems to be settling at around this level barring any unforeseen downtrends in the future.

I've bought in at around the RM0.155 level.

Hubline

(Source: biz.thestar.com.my/marketwatch)

For those of you who want to invest in a company with solid fundamentals, take a look at Hubline. This counter dropped to a low of RM1.50 during the past week in line with the overall market plunge. Since then it has recovered to RM2.11. It is my belief it will move back to its pre-decline level of around RM2.75. There are rumours this counter will move to RM5 in good market conditions. Even if it doesn't, I believe this would be a good counter to hold for the long term. It is run by very competent management and is trading at attractive valuations based on forecast FY07 earnings having purchased a majority stake in Highline Shipping recently.

I do not hold any shares in this company although I've wanted to buy into it several times during the week. I ended up trading other counters instead but I wished I had entered! It was trading below RM1.75 yesterday morning (Thursday).

Hope you had a good trading week and made some money eventhough the market collapsed during the week.

May all your trades be good trades.

Happy Trading!