Dow - Wave 5 has ended

Based on technical indicators such as William%R(14) and Slow Stochastic, it appeared that wave 5 has ended.



It is safer for me to assume that the mega wave B has ended until the market can prove me wrong that the current correction is a wave 6. But until then I will take the opportunity of the current rebound to sell whatever balance of stocks that I have.

In the next down, the mega wave C, Dow is expected to reach its March 2009 low of 6,547 or lower. If one is caught with blue chips and one has the holding power, it is still OK. But if one is caught with out-of money Warrant with short expiry date such as Dutaland Warrant A that expire in April 2012 and with a 1:1 conversion at Rm1.00, one may lose all his money as the warrant price can go to Zero upon expiry when Dutaland remains below Rm 1.00.



According to the following article written by Matthias Chang on 22 February 2011, Malaysian market should be able to hold until the coming General Election provided Dow can hold. But I am not going to take that chance at this moment.

Recommended reading, click Red Alert : For Smart Investor in Malaysia by Matthias Chang