Weekly Update

Crude Oil WTI (US$ 33.76 a barrel)

Crude oil (WTI) is at the tail end of its major wave 3.

It is about to complete the sub-wave iii of wave (v) of its major wave 3.

Dow (16,466)

Dow surged 396 points (+2.47%) on Friday. Hopefully this is the mini wave 3 of its sub-wave i of wave (i) of its major wave (7).

I shall monitor Dow by assuming that it is currently forming its major wave (7) until such time that the mega wave 2 option that I have mentioned previously becomes more probable.

FBMKLCI (1,667)

In tandem with better crude oil price and stronger Ringgit, KLCI added 33 points (+2.04%) on Friday. If KLCI can continue to move higher, it is highly possible that wave (ii) has ended with a failure c and wave (iii) of major wave 5 has started.

EG Industries Bhd (Rm 0.90)

Major wave 3 has ended and major wave 4 in progress. Hopefully it has completed its wave a of 4.

Inari Amertron Bhd (Rm 3.23)

I have revised my wave count for Inari. Very likely it is half-way through its wave (iv).

Insas Bhd (Rm 0.685)

Insas is about to complete the wave (ii) of its major wave 5.

Farms Best Bhd (Rm 0.80)


Farms Best has been moving up and down within a side-way channel in the last 7 years, forming a complex ABCDE-X-ABC corrective wave. Hopefully its September 2015's low of 47.5 sen marked the end of its mega wave (2). An OBV breakout is usually followed by a price breakout.

Very likely it is forming the sub-wave vii of its wave (i) of mega wave (2).

Dutaland Bhd (Rm 0.47)

Similar to Farms Best, Dutaland has also been moving side-way in the last 7 years forming a similar ABCDE-X-ABC complex corrective wave.

Hopefully mega wave (2) has ended and Dutaland is at the end of its sub-wave ii of wave (iii) of mega wave (3).

1MDB (US$ 4 Bil misappropriation)

Swiss attorney-general " .... suspected misappropriation amounted to about US$ 4 billion ...."

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Dow - Major wave (6) or Mega wave 2 ?

Dow (16,167)

If the correction in the last 8 months is the major wave (6), then there is a possibility that it has been completed , and major wave (7) has started. Under this scenario, Dow is expected to set more new record highs on its way to complete its major wave (7). And we will not see the 15,450 low that Dow has recorded on last Wednesday.

However, at this moment, it is difficult for me to rule out the second possibility that Dow is forming its mega wave 2.

If ultimately, it turns out that this is the case, then very soon Dow will have to break its last Wednesday low of 15,450.

FBMKLCI (1,626)

If Dow has completed its major wave (6) and is currently forming its major wave (7), to be in tandem with Dow, it is possible that KLCI has completed its wave (ii) with a failure wave c, and wave (iii) has started.

However, if Dow is forming its mega wave 2, then the current rebound for KLCI is only the mini wave 2 of c. It has yet to form its mini wave 3, 4 and 5 in order to complete the wave (ii).

Best Kept Secrete ? (Rm 2.6 billion)

After months and months of hammering, suddenly "I have returned Rm 2.03 billion in August 2013." Such a big sum of money moving in and out of the country and Bank Negara has been keeping quiet.



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Weekly Update

Dow (15,988)

Dow is either at the tail end of its wave C of (6)

Or it is at forming its sub-wave iii of (iii) wave A of major wave 2.

FBMKLCI (1,628)

KLCI is currently forming the wave c of its wave (ii).

 

EG Industries Bhd (Rm 1.00)

EG has finally ended its run and has started a higher degree correction. It has either completed its major wave 3.

Or this correction is the wave (i) and (ii) of its major wave 3.

 

Insas Bhd (Rm 0.72)

For Insas I still like to maintained my previous wave count that it is at its wave (ii) at this moment.

 
Currently it is at the wave c of (ii).

Farms Best Bhd.

It is forming the wave c of its wave (ii). The chart looked very bullish.

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2016 - Your luck in general

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First Week of 2016 - Disastrous

China introduced for the first time, starting on the first trading day of 2016, a 'circuit breaker' mechanism to curb stocks wild gyration to avert panic in the markets.

The circuit breaker is tied to the benchmark CS1300 index. A 5% swing in either direction will trigger a 30 minutes trade suspension. A further 5% move will freeze trading until the close.

A 7% swing will prompt a trading halt for the rest of the day.

On the very first day of its introduction, CS1300 index dropped 7%, Shanghai market was suspended in the afternoon. SSEC index dropped 6.86%.

On the forth day (Thursday) of trading Shanghai Market was suspended after 15 minutes of trading. SSEC dropped 7%. On that evening China Securities Regulatory Commission announced the suspension of its 'Circuit breaker' rule. SSEC rebounded by 1.97% on Friday.  

Shanghai SSEC Index (3,186)

Since its peak in 2007, SSEC has been consolidating until 2014 forming a big A-B-C corrective wave. Within the next 13 months, SSEC moved from 2,011 to 5,166 for a 157% gain, forming the major wave 1. Currently SSEC is forming the wave c of 2.

If wave c were to drop 40%, same as that of wave a, 2,180 could be the target, another 1,006 points or 31% to go.

Dow (16,346)

On the first trading week of 2016, Dow dropped 1,079 points or 6.19%. With this sharp drop, I need to have another look at Dow's long-term chart.

Since its bottom of 6,547 in March 2009, Dow has been forming its super wave VII. From 6,547 in March 2009 to 18,312 in May 2015, Dow might have gained 180%, but when compared to its super wave I (+372%), super wave III (+981%) and super wave V (+1,410%), I feel that the magnitude for super wave VII is rather small and I suspect the last high of 18,312 in May 2015 is not the end of super wave VII.

It remained possible that Dow is at the tail end of its major wave (6), mega wave 1 has 9 major waves.

Another more bearish  possibility is that mega wave 1 has only 5 major waves and it has ended in May 2015 at 18,312 level.

Dow is currently forming its mega wave 2 correction. It is at the sub-wave iii of wave (iii) of wave A of its mega wave 2, still a long way to go.

FBMKLCI (1,657)

If mega wave (5) has 5 major waves, KLCI is currently forming its major wave 5.

Unless major wave 5 is missing, then mega wave (5) has only 3 waves and it has been completed. Under this scenario, KLCI is at the starting of its super wave II correction. Personally, at this moment, I consider this scenario as unlikely but at the same time I can't say it is impossible. Anything is possible in stock.

EG Industries Bhd (Rm 1.23)

Very likely EG is at the sub-wave iii of its wave (vii) of its major wave 3.

Emico Holdings Bhd (Rm 0.355)

If Emico can continue to move higher and break its previous high, then it is on its wave (vii).

However there is also this possibility that it is forming the wave b of its major wave 4 if its major wave 3 has only 5 waves.

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2016 First Trading Day - Bloodbath

Caused by poor economic data and concerns over China's economic slowdown plus the political tension in the Middle East, Chinese stocks plunged 6.86% triggering a trading halt in the afternoon.

Panic selling by investors in Asia and Europe caused the respective indices to drop by 2% to 4%.

Dow dropped 425 points (-2.4%) to 17,000 level after about 3 hours of trading. It is going for a complex a-b-c-d-e-X-a-b-c sub-wave iv.

KLCI dropped 39 points (-2.3%) to end at 1,653. Very likely it is going for a complex a-b-c-X-a-b-c wave (ii) correction in tandem with Dow.

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What to expect in 2016

In General

I expect the crude oil (WTI) price to bottom out at around US$27 a barrel before June. The Ringgit is expected to rebound in tandem with the crude oil price. I expect FBMKLCI continues to move higher ahead of that.

Crude Oil WTI (US$ 37.08)

Crude is at the tail end of its major wave 3. I expect the major wave 4 rebound during second quarter of 2016.

From the weekly chart, it appeared to me that the crude oil price has completed its sub-wave iii and has started to form its sub-wave iv. If sub-wave iv can end around US$40.00, sub-wave v is projected to drop another 33% to US$27.00 to complete the wave (v) and its major wave 3.

With that, the major wave 4 rebound is expected to bring the crude oil price to above US$60.00 before the assets bubble burst in 2017 and the major wave 5 is expected to bring the crude oil price to below US$20.00.

Dow (17,425)

I expect Dow to complete its major wave (7), (8) and (9) by 2017 before the bubble burst.

Dow has either completed its sub-wave iv and is forming its sub-wave v at this moment.

Or it has yet to complete its complex sub-wave iv.

FBMKLCI (1,692)

KLCI is expected to move higher in 2016 and to complete its major wave 5 in 2017. So far it has completed its wave (ii) and is forming the sub-wave i of its wave (iii).

Wave (iii) should be more dynamic and powerful than its wave (i).

EG Industries Bhd (Rm 1.10)

EG is either forming its wave (vi)

Or on a very bullish short-term view, it is forming its sub-wave iii of wave (v) depending on its direction of movement next week.

Emico Holdings Bhd (Rm 0.36)

Emico is likely to have completed its major wave 3 and is on its major wave 4.

But because of the huge volume for its wave (v), there is a possibility that the current correction is the wave (vi). The possibility of another powerful wave (vii) surge with high volume can not be ruled out.

Farms Best Bhd (Rm 0.65)

The powerful surge to form the sub-wave v signaled the completion of its mega wave (2). This 5 waves up indicates the starting of a new wave, the mega wave (3).

From the 10-year chart, one can see that its took Farms Best 7 years to complete its mega wave (2).

If Farms best can move up strongly in the next few days, it is possible that the last surge is the mini wave 1 of its sub-wave v.