Dow - Continues with its major wave 9

Dow (25,316)

Dow is forming the wave (iii) of its major wave 9 currently. Major wave 9 can have either five or nine waves.

FBMKLCI (1,778)

KLCI can continue to move higher to complete the wave (v) of its major wave 5. If major wave 5 has nine wave instead of five , KLCI may even continue to for its wave (iv), (vii), (viii) and (ix) before ending the major wave 5.

But, if KLCI instead of moving higher, it starts to move lower and lower and and break the low of its major wave 4, it can only mean that it has completed its major wave 5 as well as its mega wave (5), which is very very bearish. I personally consider this scenario as less likely since Dow is forming its bullish major wave 9 and Dr. Mahathir seemed to have things under control.

But if technically the bull run from September 1998's low of 262, the super wave I has ended, the minimum target for the super wave II correction is the end of mega wave (4) at 829 level. That will give a 56% pullback. This will happen if there is a major global stock disaster. Don't forget that the bear always started quietly with seemingly harmless drops.

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Jokers

SSER new RM9.4 billion scandal

Payment based on timetable

instead of quantum of work completed.

They have betrayed the whole nation 

by signing such a contract with China

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How long can Pakatan Harapan Last ?

A coalition of convenience to oppose BN.

It was a hard-won battle 

Pakatan Harapan won by a simple majority of 113, only 2 seats above the magical 111 figure. This is only the 4th week after GE14 but so many things has happened and some were dramatic. I was like sitting in front of my TV watching HBO. 

Tomorrow will feature our main actress, Rosmah Mansor's venture at the MACC.

As well as the Conference of Rulers to look into the appointment of Tommy Thomas as the new Attorney General.

Click 'Alamak-OutSyed The Box' for an interesting article.

Rais Yatim 'Beh Tahan'

Back to my earlier question, looking at all the events in the last three weeks, how long can PH last?

Is there any precedence in other countries where a dominant government that has been in control of the country for decades being overthrown by a coalition of opposition parties with diverse political ideology?

India (JP 1977)

The Indian National Congress (INC), India's dominant political party, that won 5 consecutive national elections after India's independence in 1947. They were in control of the central government of Indian for 30 years until 1977 when they lost the 6th national election to Janata Party (JP), which was an amalgamation of several Indian political parties with a common goal of overthrowing the INC. 

JP won a sweeping majority (330 out of 542 seats) in the Indian Parliament. But in the following 3 years, continuous in-fighting and ideological differences made the new JP government unable to effectively address national problems. They had two Prime Minister within three years(1977 to 1980). 

In the 1980 general election the INC took back the central government and continued to win all the election until 1996. JP had ceased to exist. 

Japan (DPJ 2009)

The Liberal Democratic Party (LDP) and its allies that had governed Japan since 1955 (except for a brief period in 1993) was defeated by the Democratic Party of Japan (DPJ) in 2009. 

DPJ, a coalition of four political parties, after winning the election in 2009, there were endless in-fighting within DPJ. They had three Prime Ministers in three years. On the third year, in 2012,  DPJ lost terribly to LDP in the general election. LDP continued to win the 2017 general election.

Malaysia (PH 2018)

Pakatan Harapan under the leadership of 93-year old Dr. Mahathir that has very little time to spare (considering his advanced age) has inherited a hot potato with Rm 1 trillion national debts, a most bloated civil service in the world, endless problems of race, religion, corruption,etc. etc. But the main challenge to the survival of PH is whether the four component parties can stay united without in-fighting and can effectively address the national problems as a true coalition. 

Don't forget Umno and Pas that have a combined Malay votes of more than 50% are ever ready to stir up racial and religious issues to their benefit. And don't forget the king at the palace.

How long can PH last? The next question is whether PH can win the 15th GE? It depends on whether the 4 component parties can stay united, trusting each other and work like how Dr. Mahathir 2.0 has been worked since he was appointed as the 7th PM.

We must stand behind the new government that we have voted in

I have been wondering why it has taken such a long time in appointing the rest of the cabinet? Then I saw the following

I thought this must be the reason until I read the latest article from Syed Akbar Ali. If what he said is true, we all must stand behind Tun Dr Mahathir to uphold the Federal Constitution and the Rule of Law.

Click 'Outsyed The Box' for the article.

At the end of his article he said,

" If such an event comes to pass, let us all stand behind our Prime Minister. 

Not just because our Prime Minister happens to be Tun Dr Mahathir Mohamed but more importantly because we must uphold the Federal Constitution and the Rule of Law in this country. 

If we do not stand up very firmly for our rights now,  then they are going to trample all over us again. And again".

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Bursa Malaysia - No other choice except Bear.

FBMKLCI (1,719)

KLCI dropped 56 points today (-3.19%) to confirm the arrival of the bear. At best, we still have a last rebound, the wave (v).

Or it may choose to go all the way to the south with some technical rebound along the way.

If the current correction is a mega wave (6) correction, it will either have a shorter duration sharp 45% pullback to 1050 level or a longer duration but not so deep, say about 25% pullback to form the mega wave (6).

If it is a super wave II correction then it will have to drop to at least the mega wave (4) level.

Industrial Index (3,052)

The Industrial Index dropped 102 points (-3.23%) today. The most likely wave count is an overlapping wave (i)-(ii)-(iii)-(iv)-(v) major wave 5 formation. Similarly it is either forming its mega wave (6) or it is forming its super wave II corrective wave.

Similar to KLCI, its mega wave (6) can either be a shorter duration but bigger magnitude 37.5% pullback or a longer duration complex wave with about 20% pullback.

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Some of the Mega Projects Committed or Proposed

The 'One Belt One Road Initiative' (OBOR) refers to 'The Silk Road Economic Belt and the 21st Century Maritime Silk Road', which is a development strategy rolled out by the Chinese government.

Peninsular Malaysia with Strait of Malacca that handles almost half of the world's total annual seaborne trade tonnage, has a crucial role in this China's initiative.

Ever since China rolled out its OBOR initiative, many countries have received billions of dollars (loans from China) towards infrastructure development more to serve China's objective under the pretext of trade. 

What will China do if a country is unable to service its loan? 

Sri Lanka under such a situation, hands over the strategic Hambantota port (refer to the OBOR map for its location) to China on a 99-year lease in December 2017 when she failed to pay her debt. (China has learnt her Macau's and Hong Kong's lessons from the western power). 

The Najib administration that loved mega projects, took the opportunity to borrow money from China to pay China to build infrastructures to serve mainly China's objectives as well as his objectives. 

Projects related to OBOR committed by Najib so far include the ECRL (Rm54 billion that may finally exceed Rm100 billion), the Melaka Gateway (Rm27 billion), Kuala Linggi Port (Rm11 billion), Penang Port (Rm 5.6 billion) and Kuantan Port (Rm700 million). Yet to be committed is a proposed Carey Island project (Rm100 billion) in a China-MMC joint venture.

Other China projects and investments that are not related to OBOR are the Forest City (US$100 billion), Robotic Future City, Johor (US$3.46), Samalaju Steel Complex (US$3 billion), Land Reclamation Penang (US$540 million), Green Technology Park, Pahang (US$470 million), Methanol Plant, Sarawak (US$190 million) and The Shore, Sabah (US$130 million).

With the Singapore government is the Kuala Lumpur-Singapore High Speed Rail (Rm110 billion) which the PM Dr. Mahathir has announced its cancellation in order to reduce the federal debt that has gone beyond Rm1 trillion.