All the indicators are telling only one thing, the market is highly overbought. In a normal and well behaved market, the indicator tops and bottoms correlate nicely with the KLCI turning points. However the problem with indicators at extream market condition is that the indicators can remain at the tops and bottoms for quite a while under over-bought or over-sold conditions whereas the indices and stock prices can continue to move up by quite a substantial amount. Normally the longer the indicators remained at the tops or at the bottoms, the stronger is the following up-ward or down-ward movement. Similarly the longer the current KL market remains at over-bought position the more drastic the correction will be when it comes. This condition is always a problem to traders that moved in and out of the market frequently, but to the medium-term and long-term investors that hold the stocks until the final phase of Wave B, this condition does not require any action.
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