ZLBT Chats

Tuesday, May 31, 2011

ZLBT >>> FBMKLCI Futures Technicals / Movements

Look for futures to trade range bound today
 Futures buoyed by the three white soldiers formation and traded higher after broke its resistance of 1545. MACD bullish divergence likely to support buying interest and kept futures trading above the support of 1539. To the upside, resistance pegged at 1552 and thereafter 1558.
An estimationof 85% roll completed so far and today will be the expiry of May11 contract.

Recommended Strategy
Aggressive trade may long with stop on close below 1515.

Monday, May 30, 2011

Technical Analysis : FBMKLCI 30/05/2011 / 综合指数 2011年05月30日

综合指数 2011年 05月 30日





Friday, May 27, 2011

ZLBT Random Charts >>> FBM KLCI + DJIA

Please click on image to ENLARGE
 Support shown by both FBM KLCI & DJIA but the end result is inevitable.
A matter of time.

Thursday, May 26, 2011

WALL STREET : DJIA Snaps Losing Streak

Major Indexes Gains 1st Time This Week
Stocks started the day on a negative note, thanks to downbeat durable goods data and lackluster earnings from retail issues both high-end (Polo Ralph Lauren) and low-end (Costco Wholesale). For a while, it looked as though the market was doomed to endure a fourth straight down day. However, the Dow Jones Industrial Average (DJIA) pared its losses after finding support at its 80-day moving average, and the rebound gathered steam as oil futures powered back above the century level. A note from Fitch Ratings also helped to encourage the recently reticent bulls, with the agency opining that Germany -- the fiscal stalwart of the euro zone -- was unlikely to have its ratings impacted by the debt woes of neighboring countries. Against this backdrop, all three major market indexes managed their first daily win of the week.

The Dow Jones Industrial Average (DJIA – 12,394.66) couldn't quite gather enough steam to maintain its intraday footing above the 12,400 level, but nevertheless managed to tack on 38.5 points, or 0.3%, by the close. Eighteen of the Dow's 30 components closed higher, with DuPont (DD) and Caterpillar (CAT) leading the way. On the other side of the coin, Verizon Communications (VZ) led the dozen laggards with a 1.4% pullback. Although the Dow found support today at its 80-day trendline, the index continues to be stymied by its 50-day moving average. The blue-chip barometer has now closed three straight sessions below this closely watched technical level.

The S&P 500 Index (SPX – 1,320.47) followed suit with a modest rise of 4.2 points, or 0.3%. The SPX is now trading back above its 20-week moving average, which hasn't been breached on a weekly closing basis since Aug. 27. Finally, the Nasdaq Composite (COMP – 2,761.38) outpaced its peers by adding 15.2 points, or 0.6%. However, the COMP is still trading on the south side of its 20-week trendline, which was last violated in mid-March.

Dow Jones Industrial Average
The Dow closed higher due to short covering on Wednesday as it consolidated some of this month's decline. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are oversold but remain bearish signaling that sideways to lower prices are possible near-term. If the Dow extends this month's decline, the 50% retracement level of the March-May rally crossing at 12,216 is the next downside target. Closes above the 20-day moving average crossing at 12,617 are needed to confirm that a short-term low has been posted. First resistance is the 10-day moving average crossing at 12,513. Second resistance is the 20-day moving average crossing at 12,617. First support is today's low crossing at 12,309. Second support is the 50% retracement level of the March-May rally crossing at 12,216.

Crude Oil Settles At 2 Weeks Peak
Crude futures cruised to a new two-week high today, as traders cheered the Energy Information Administration's (EIA) weekly inventories report. The agency reported a steep drop-off in distillate stockpiles last week, as well as a healthy uptick in refinery activity. The news effectively overshadowed a substantial build in gasoline supplies, while a softer U.S. dollar increased black gold's appeal to foreign currency holders. Crude oil for July delivery jumped $1.73, or 1.7%, to end at $101.32 per barrel -- its best finish since May 10.

Wednesday, May 25, 2011

ZLBT Morning Views >>> Bursa Malaysia + Wall Street

Tight Range Expected For Malaysia Stocks
The Malaysian stock market on Tuesday snapped the two-day losing streak in which it had retreated more than 15 points or 1 percent. The Kuala Lumpur Composite Index finished just above the 1,530-point plateau, and now traders are expecting the market to hold steady in that neighborhood when it kicks off trade on Wednesday.
The global forecast for the Asian markets is mixed with a touch of downside thanks to persistent debt concerns in Europe and a mixed batch of economic news from the United States. Oil and gold stocks are expected to rise, while airlines and technology stocks are expected to ease. The European markets finished higher and the U.S. bourses ended lower, and the Asian markets figure to split the difference.

The KLCI finished slightly higher on Tuesday following slim gains from the financial shares, industrial issues and plantation stocks.

For the day, the index added 3.14 points or 0.21 percent to finish at 1,532.12 after trading between 1,525.71 and 1,533.22. Volume was 812.197 million shares worth 1.54 billion ringgit. There were 437 gainers and 312 decliners, with 311 stocks finishing unchanged.

Among the actives, Tenaga Nasional, Petronas Chemicals, RHB Capital, YTL Power, Telekom Malaysia, Axiata and IOI Corporation all finished higher, while Maxis was unchanged and Maybank and CIMB Group ended lower.

The lead from Wall Street suggests minor consolidation as stocks showed a lack of direction on Tuesday, with traders reluctant to make any significant moves following the previous day's selloff. The markets eventually ended the session on the downside, extending a recent downward trend.

Wall Street : Dismay Data Downer; Dow Extend Losing Streak
Stocks struggled to pick a direction today, with all three major market indexes hemming and hawing around the breakeven line. In the bulls' corner, traders cheered a dose of surprisingly pleasant housing data, while energy-related equities made headway in the wake of an upwardly revised crude forecast from Goldman Sachs. However, another discouraging report on manufacturing rained on the bulls' parade, as did a federal report showing a growing number of problem banks. The lingering concerns about European debt merely tipped the scales in the bears' favor, with stocks settling in the red for the third straight session.

The Dow Jones Industrial Average (DJIA – 12,356.21) ended a wishy-washy session with a loss of 25.1 points, or 0.2%, as 21 of its 30 components finished lower. General Electric (GE) led the bearish majority with a 1.5% deficit, while oil concern Chevron Corp. (CVX) paced the nine advancing equities with a gain of 0.9%.

The S&P 500 Index (SPX – 1,316.28) also settled a volatile session in the red, surrendering 1.1 points, or 0.1%, by the close. In similar fashion, the Nasdaq Composite (COMP – 2,746.16) suffered the steepest loss, giving up 12.7 points, or 0.5%, to end near a session low. What's more, today marks the COMP's first finish south of the 2,750 level since April 19.

Crude Oil Rebound 1.9%
Crude futures ended higher today -- though black gold failed to finish atop the key century mark. Boosting the commodity was an ailing dollar, as well as an upwardly revised forecast from Goldman Sachs. "Although the growth environment is clearly slower than the one before the unrest began and downside risks remain in the near-term, we expect oil prices to move substantially higher over the next 18 months," the analysts wrote, citing the loss of production in war-torn Libya. Against this backdrop, crude oil for July delivery added $1.89, or 1.9%, to settle at $99.59 per barrel.


Tuesday, May 24, 2011

WALL STREET : Euro Zone Debt Fears Send DJIA Tumbling

Grow(l)ing Bears Send Shivers Down Global Market's Spine
Sovereign debt concerns and the prospects for slower growth in Europe and Asia took their toll on global markets on Monday, with stocks on Wall Street spiraling more than 1 percent lower on all three major indexes.

Treasury prices and the dollar rose. Asian and European shares were lower after developments in Greece, Spain and Italy refocused attention on the euro zone’s fiscal uncertainty. Manufacturing statistics released by Germany and China were softer than forecast, raising the prospect of slower growth in Europe and in China, which has the world’s second-largest economy, and unsettling investors.

“It is a bit of a risk-off environment right now,” said Eric Viloria, senior technical strategist for Forex.com. “Markets are risk-averse, and the U.S. dollar is benefiting.”

The Dow Jones industrial average fell 130.78 points, or 1.05 percent, to 12,381.26, its lowest close since April 19. The Standard & Poor’s 500-stock index was down 15.90 points, or 1.19 percent, at 1,317.37. The Nasdaq was down 44.42 points, or 1.58 percent, at 2,758.90

Materials, energy, industrials, utilities, financials and information technology tumbled by about 1 percent.

Caterpillar fell about 2.34 percent, to $101.89, and General Electric was 1.17 percent lower at $19.39. Energy stocks tumbled, with Halliburton falling 2.16 percent, to $46.16, Exxon Mobil down 1.1 percent at $80.67, and Schlumberger down 1.7 percent at $82.08.

Citigroup was more than 2 percent lower at $40.16, while Bank of America was lower by 1.38 percent at $11.42. JPMorgan Chase fell more than 1.3 percent to $42.55.

In Asia, the Nikkei index fell by more than 1.5 percent and the Hang Seng was down by just over 2 percent. The Shanghai index was lower by 2.9 percent.

In Europe, the CAC 40 closed down by 2.1 percent, the DAX in Germany was 2 percent lower, and the FTSE ended the day down by 1.9 percent.

Analysts said recent news from Europe had not instilled confidence in the Continent’s ability to handle its fiscal challenges. Last week, Fitch Ratings downgraded Greece’s credit ratings by three levels to B+, a rating that is below investment grade. Standard & Poor’s lowered its outlook on Italy’s debt to negative from stable over the weekend, citing a weaker outlook for growth and lower prospects for the country’s ability to trim its debt.

And Spain made headlines after its Socialist Party lost on Sunday in regional and municipal elections as tens of thousands of Spanish protesters, their anger partly fueled by the debt crisis and joblessness, are trying to force an overhaul of the political system.

Declines in Asia’s markets followed the HSBC preliminary purchasing managers’ index reading, a gauge of the manufacturing sector activity, for China, which fell to a 10-month low of 51.1 in May, according to news agencies, signaling a slowdown in expansion. Still, the Chinese government is poised to continue fiscal tightening. A similar gauge for Germany dropped to 54.9 in May, below forecasts.

The financial services and valuations company, Markit, said on Monday that its manufacturing P.M.I. for the euro zone was at a seven-month low at 54.8 in May, the sharpest slowdown since just after the collapse of Lehman Brothers in 2008, according to Chris Williamson, the chief economist.

While the numbers could have been affected by seasonal factors like the timing of Easter this year or by supply chain disruptions from the disasters in Japan, they show a “more fundamental slowing in the pace of economic growth,” he said in a statement.

Bruce McCain, the chief investment strategist of Key Private Bank, said the signs of weaker economic activity in China were counterbalanced by high inflation, with the possibility that they would have to continue to raise rates.

In Europe, he added, “not only are they again grappling with the sovereign debt issue, but inflation remains uncomfortably high and they seem determined to raise rates again.”

Treasury prices rose on Monday. The Treasury’s benchmark 10-year note rose 5/32, to 99 31/32 , and the yield fell to 3.13 percent from 3.15 percent late Friday. The yield has fallen by more than 40 basis points in a little more than a month.

Concerns over Europe reawakened the potential for oil demand to decline, causing crude prices on Monday to slip.

The dollar was higher against a range of currencies, with the euro falling below $1.40.

“Certainly while there is concern about the dollar’s secular decline we have to be encouraged that it is still seen as a strong currency,” said a forex analyst.

Monday, May 23, 2011

ZLBT Charts and Data >>> FBM KLCI + FKLI

Please click on image to ENLARGE

 Take note of the market's green days & red days. Pay attention to the sizes of the candles.
FBMKLCI and/or  both in tandem. The only difference is futures have different depth of discounts.

Saturday, May 21, 2011

WALL STREET : Volatile Ride To A Down Week

Dow dives 93 pts as investors awaits Housing, Consumer Confidence & GDP Data next week
The Dow Jones Industrial Average (DJIA – 12,512.04) gave up 93.3 points, or 0.7%, by the time the bell mercifully sounded. Only Walt Disney (DIS) and Kraft Foods (KFT) bucked the trend lower, while Alcoa (AA) and JPMorgan Chase (JPM) led the bearish majority with losses of 2.5% and 2%, respectively. While the Dow found support in the 12,500 level, today's retreat pushed the blue-chip barometer to a loss of 0.7% for the week.

The S&P 500 Index (SPX – 1,333.27) ended near its intraday nadir, finishing with a loss of 10.3 points, or 0.8%, to settle at the psychologically significant 1,333 level -- which marks double its March 2009 low. Finally, the Nasdaq Composite (COMP – 2,803.32) swallowed a similar loss of 20 points, or 0.7%, but found a foothold in the round-number 2,800 region. For the week, the SPX gave up 0.3%, while the tech-rich COMP fared the worst of its peers, surrendering 0.9%.

Data related to housing, consumer confidence and economic growth will all be eyed next week by investors looking for signs that the U.S. economy is strengthening.

The housing sector has been especially slow to rebound after the worst financial downturn in the U.S. since the Great Depression. Analysts believe a full-fledged recovery won’t occur until the housing market hits a bottom. All signs seem to indicate that that hasn’t happened yet.

Sales of new single-family homes in April will be released on Tuesday. These homes are competing with a surplus of existing homes put on the market due to record foreclosures. Housing experts say buyers are sitting on the sidelines waiting for prices to fall further, which is good for individual buyers but bad for the nation’s housing market.

On Wednesday home builder Toll Brothers (TOL: 20.66, +0.05, +0.24%) is expected to report its quarterly earnings and those figures will certainly have an impact on the broader markets.

Meanwhile, on Tuesday two Congressional committees will hold hearings important to U.S. consumers. A Senate committee will discuss the future of the housing finance system, and a House committee will hold a hearing on domestic oil and gas production.

The second estimate of first-quarter GDP is due Thursday. The preliminary report placed growth at 1.8%, but that number is expected to be revised higher as a result of an increase in consumer spending. Consumer spending comprises 70% of the U.S. economy.

April personal income and spending reports are due Friday and are expected to show that incomes rose modestly, while spending was slightly higher. Consumer spending rose in no small part due to increased costs tied to soaring food and energy prices.

Final readings for consumer confidence in May are due Tuesday from the Conference Board's Consumer Confidence Index, and on Friday for the Reuters/University of Michigan Consumer Sentiment Index. Earlier readings showed improved confidence as labor markets seemed to be gaining traction earlier this spring. But revisions my inch downward as higher gas and food prices eat into consumers’ pocketbooks.


Friday, May 20, 2011

Technical Analysis : 综合指数 2011年05月20日 / FBMKLCI 20/5/2011

综合指数 2011年 05月 20日



Thursday, May 19, 2011

WALL STREET : DJIA Takes Back 12,500 on Low-Volume Victory

The Dow Snap 3 Straight Losing Sessions
After three straight losing days for the Dow, the major market indexes seemed bound and determined to regain some ground today. A surprisingly upbeat earnings forecast from Dell (DELL) helped fuel the bulls, as did some merger-and-acquisition news from Allstate (ALL) -- even as the latest quarterly reports from retail mainstays Target (TGT) and Staples (SPLS) fell flat. Traders also shrugged off signs of discord at the Fed, with members of the rate-setting Federal Open Market Committee (FOMC) at odds over how and when to withdraw liquidity from the financial system. "A few members viewed the increase in inflation risks as suggesting that economic conditions might well evolve in a way that would warrant the Committee taking steps toward less-accommodative policy sooner than currently anticipated," according to the minutes from the FOMC's late-April meeting. Despite this lingering economic uncertainty, the day was ultimately a low-volume victory for the bulls.

The Dow Jones Industrial Average (DJIA – 12,560.18) found an intraday roadblock in the form of the 12,570 level, but still managed a solid gain of 80.6 points, or 0.7%. All but seven of the Dow's 30 components closed higher. Caterpillar (CAT) paced the 23 advancing blue chips with a 3.1% rise, while Hewlett-Packard (HPQ) swallowed the steepest loss of 1.1%, pressured by a fresh round of post-earnings downgrades and price-target cuts. Thanks to today's jump, the Dow reclaimed its foothold above the 12,500 level, and has now whittled its weekly deficit to just 0.3%.

The S&P 500 Index (SPX – 1,340.68) fared similarly well, adding 11.7 points, or 0.9%. In fact, the SPX eked out a daily close above its 10-day moving average for the first time since May 10, and is now up 0.2% for the week. Finally, the Nasdaq Composite (COMP – 2,815.00) bounced back above the 2,800 region, ending the day up 31.8 points, or 1.1%. However, the COMP is still down 0.5% from last Friday's close.

Crude Regains Foothold Above $100 per barrel
Crude futures reclaimed a foothold in triple-digit territory today, as a surprise drop in domestic inventories sparked some buying interest for the beaten-down commodity. U.S. crude stockpiles declined by 15,000 barrels last week, according to the Energy Information Administration (EIA), while gasoline supplies rose by a smaller-than-forecast 119,000 barrels. This news of dwindling petroleum inventories, taken in context with the commodity's recent pullback, set the stage for bargain-hunters to make their move. Crude oil for June delivery finished with a gain of $3.19, or 3.3%, at $100.10 per barrel.


Wednesday, May 18, 2011

Trading In Volatile Markets

Trading in volatile markets provides extraordinary opportunities but it also carries more risk. For more aggressive traders, volatile markets can lead to larger than normal losses, but they can also provide rare opportunities that can be highly advantageous for your trading account. If you are going to trade in volatile markets, or if you have positions and the markets become volatile, you need to know how to recognize the warning signs and navigate through the storm. You have to be able to manage risk if you want to take advantage of substantial price moves.

If you are trading a volatile bull or bear market, you need to use the possible daily trading ranges as a guideline for capital. Exchanges and clearing firms are slow to act. They are rarely ahead of the curve on margin issues, and they are usually caught off guard and have to increase margins after the damage is done.

By understanding that you need more capital on hand to trade volatile margins, you will have more staying power than the average trader. The trader using margin as a guideline will not be able to stay in the position. A trader who understands that volatile markets can have higher trading ranges than the exchange margin should be able to ride out the storm better.

When the markets become volatile, it doesn't mean you have to stop trading. Your opinion of the markets can still be correct but outside factors may be an issue. For example, the US Dollar, European nations needing bailouts, wars in the Middle East, the natural disaster in Japan, can all affect the markets. In my opinion, what you need to do is take on less risk during these times. The only way to really achieve this is to de-leverage. The best way to do this is to reduce your position size so you can stay in the game.

When the markets become volatile, traders need to have more capital for their positions. Greater daily trading ranges means traders should have more capital per position. If the trader does not have the capital for the increased volatility, they need to de-leverage. One way to de-leverage is to either reduce position size or trade mini contracts instead of standard contracts.
Another way to de-leverage is to use futures spreads. Traders caught in a volatile market can use futures spreads to potentially reduce the risk in their position. They can leg out of the spread into their original position after the smoke has cleared. Finally, traders can also reduce risk and de-leverage by using options with their futures position or just use option spreads, like a bull call spread or a bear put spread.

All in all, the most important thing to take away is that when the markets are volatile, traders need to reduce their risk exposure. While volatility may provide extraordinary profit potential, it also may lead to greater than normal risk. Traders need to manage this risk while still being able to take advantage of price movements in the market. By reducing their risk exposure, traders will be able to stay in the game and have the opportunity to go after substantial price moves.


ZLBT Morning Views

Soft Start Expected For Malaysian Stocks

Ahead of Tuesday's holiday for Vesak Day, the Malaysian stock market had finished lower in two of three sessions since the end of the three-day winning streak in which it had collected more than 20 points or 1.3 percent. The Kuala Lumpur Composite Index finished just above the 1,535-point plateau, and now analysts are expecting to see the market make up for missing some negative sentiment when it kicks off trade on Wednesday.
The global forecast for the Asian markets calls for mild consolidation on lingering debt concerns in Europe. Properties and technology stocks figure to see continued pressure, with gold and financial shares rising on bargain hunting. The European and U.S. markets finished lower on Tuesday, and the Asian bourses are also expected to track to the downside.

The KLCI finished slightly lower on Monday following mild losses among the financial shares, industrial issues and plantation stocks.
For the day, the index eased 4.47 points or 0.29 percent to finish at 1,536.27 after trading between 1,536.27 and 1,545.34. Volume was 811.79 million shares worth 1.23 billion ringgit. There were 502 decliners and 274 gainers, with 286 stocks finishing unchanged.
Among the actives, Axiata and Maxis finished lower, while Petronas Chemical and Sime Darby were unchanged and Maybank and CIMB Group ended higher.

WALL STREET :  DJIA falls below 12500 with 3rd session loss
The Dow Jones Industrial Average (DJIA – 12,479.58) trimmed its triple-digit deficit in afternoon trading, but still ended on a loss of 68.8 points, or 0.6%, to settle south of 12,500 for the first time since April 25. Hewlett-Packard -- unsurprisingly -- led the 14 laggards with a 7.3% drop, while JPMorgan Chase (JPM) paced the 16 advancing equities with a gain of nearly 2.2%.

The S&P 500 Index (SPX – 1,328.98) also chipped away at its intraday deficit in late-session trading, giving up just 0.5 point, or 0.04%, by the close. Helping the broad-market barometer climb out of the doldrums was its 10-week moving average, which hasn't been compromised on a weekly closing basis since mid-March. Finally, the Nasdaq Composite (COMP – 2,783.21) bucked the trend, clawing its way to a fractional gain of 0.9 point, or 0.03%, in the final hour of trading. Nevertheless, the tech-rich COMP is still in danger of ending the week south of its 10-week trendline for the first time since late March.

Tuesday, May 17, 2011

WARNING : U.S. stocks could nosedive at any time

Wall Street Indexes steepened their losses in the final hours of trading
So much happened in the markets the past week that it was easy to miss.

 The Dow Jones Industrial Average (DJIA – 12,548.37) ended a wishy-washy session with a loss of 47.4 points, or 0.4%, capping off its second straight finish beneath its 20-day moving average. Only nine of the Dow's 30 components emerged unscathed, with American Express (AXP) pacing the advancers with a gain of nearly 1.2%. On the flip side, tech titans Microsoft (MSFT) and Cisco Systems (CSCO) led the laggards with losses of 1.8% and 1.5%, respectively.

The S&P 500 Index (SPX – 1,329.47) also gave back its mid-session gains, ending 8.3 points, or 0.6%, below breakeven. What's more, the broad-market barometer settled south of the psychologically significant 1,333 level -- which marks double its March 2009 low -- for the first time since April 20. Finally, the Nasdaq Composite (COMP – 2,782.31) fared the worst of its peers, swallowing a loss of 46.2 points, or 1.6%, to end beneath the round-number 2,800 level for the first time since April 19.

But – lost amidst the huge sell-off in commodities and the 115-point drop in the Dow last Wednesday – were a couple of very clear warning signs that the U.S. is fast approaching a rotational downside season.

The U.S. now inching ever closer to the possibility of a "double-dip" recession.
You just about have to be prepared for anything in the month of May and that certainly proved true on Wednesday following a halt in the CME in the energy futures contracts for 5 minutes that sent commodity traders heading for the hills for fear of being locked into trades in fast market conditions.
One of the unknowns is the action of the CME and the sudden risk of being forced out of positions on margin - especially when the market is halted!

Stocks were hammered last Wednesday and commodity stocks were largely crushed. Crude oil prices fell $5.67 a barrel to close at $98.21; with the US dollar up sharply again as intermediate-term cycles emerge higher.
I don't know what sparked the energy futures selling for sure, but I can say that most of the big oil speculators are none other than JP Morgan and Goldman Sachs - both clearly into selling mode today right on the heels of trying to suck people into the market these last few days. Did anyone care to notice the volatility that ended on Friday. Pheeewwww!

In any case, it is rare to see a halt in oil trading as we saw Wednesday. The last halt in oil trading occurred in September 2008.

CME also doubled the daily limits in its energy futures, which means more downside risk for oil speculators. Fast market conditions – coupled with the CME halting the market – create a sense of panic among speculators who already have to cope with the uncertainty that margin requirements could be jacked up at any time on them and another possible halt, locking them out of the market.
As you can imagine commodity stocks were hit Gold closed down $15.50 an ounce to $1,501 (still above its 50-day moving average) while SLV lost all of its 3 day gains, now probing its bottom again at 34.39. As I said, the primary dealers will be looking now to sell into any rallies. And given the recent overhang of the CME it could be a rough go this second quarter for commodities in general.

Sorry if I am so cynical but isn't it a bit late now that the economy is going into oil shock and gasoline prices are back to the highs of 2008? And we see Senators are just now going after commodity speculators?

This suggests the primary dealers are ready for the slide and are shorting the commodity market ahead of the next recession. To me, this is a huge tell, folks!

Is the US Close To A Double Dip?
In other news, the Fed announced its new POMO schedule for the month of June ($93 billion). This is the lowest of all the QE2 months. The challenge now for investors will be the volatility as we head towards the end of June.

Also, it was reported on Wednesday that The U.S. trade deficit widened from $45.4 bln in February to $48.2 billion in March. This is the widest the trade deficit has been since June 2010.

Not only was the increase in the trade deficit in March greater than the consensus forecast, it was also significantly higher than what the BEA assumed in the first quarter GDP report. There should be significant negative revisions to Q1 GDP as a result of the new data.

This puts the US very close to striking distance for double dipping in this economy and this data is really before we get the Japanese earthquake eff

Early Stages of a Correction
From a purely trend following perspective, the stock indexes are trending above their 50-day moving averages, are trending above their 200-day moving averages and the long-term primary trend remain in bullish territory.

However, we also know that this bull market since March of 2009 is not based on free market action discounted to the true economy but based on liquidity injections of QE1 and QE2 going directly to the primary dealers who in turn have leveraged this money into the capital and commodity markets to re-inflate their sunken balance sheets.

When QE1 ended at the end of April of 2010, a flash crash followed and stocks fell back into a bear market until the Fed started up its POMO activities again in August of 2010 and a new bull market began as a result of QE2. That ends in June.

For the last few months market breadth has been contracting. Technically, this is a clear warning signal as we saw in late 2007 that investors were getting ready for recessionary times and we are seeing a similar pattern now. Bear market begins when liquidity dries up for the primary dealers and the economy begins to contract, so as investors we have to prepare for a very limited life span for the remainder of this bull market.

The first place where prices will start to break down is at the 50-day moving averages. It will become harder for the indexes to hold above them. The major indexes should then oscillate above and below the 50MA for a while - and then prices will start to fail the 50MAs - and when that happens, the 50-day MA will start to descend downward towards an upward sloping 200-day moving average.

Investors have to decide how willing they are to gamble with the Fed before QE2 ends or gamble that something new will be revealed before the end of June that will support the bull market, independent of deteriorating fundamentals.
As per said, we are entering into the early stages of a contraction and just about anything can happen now.


Monday, May 16, 2011

ZLBT Morning Views >>> Bursa Malaysia

Malaysian Stocks May Face Renewed Selling Pressure

The Malaysian stock market turned right back to the upside again on Friday, one session after it had ended the three-day winning streak in which it had collected more than 20 points or 1.3 percent. The Kuala Lumpur Composite Index finished just above the 1,540-point plateau, and now analysts are forecasting a soft start for the market when it opens on Monday.

The global forecast for the Asian markets suggests consolidation on continued unrest in the Middle East and debt concerns in Europe. Steel companies figure to bear the brunt of the damage, along with financials and technology stocks. The European markets were mixed on Friday and the U.S. bourses were sharply lower - and now the Asian markets also are expected to track to the downside.

The KLCI finished modestly higher on Friday as gains from the financial sector were dented by selling among the industrials and plantation stocks.

For the day, the index collected 8.45 points or 0.55 percent to finish at 1,540.74 after trading between 1,532.94 and 1,545.21. Volume was 1.18 billion shares worth 1.71 billion ringgit. There were 499 gainers and 258 decliners, with 303 stocks finishing unchanged.

Among the actives, CIMB Group, Sime Darby, Maybank, Genting, Axiata and Hong Leong Bank all finished higher.

The lead from Wall Street is negative as stocks moved sharply lower over the course of the trading day on Friday. Renewed concerns about the financial situation in Europe contributed to the weakness on Wall Street along with some strength in the value of the U.S. dollar.

Wall Street major averages moved roughly sideways in afternoon trading, stuck firmly in negative territory. The Dow fell 100.17 points or 0.8 percent to 12,595.75, the NASDAQ dropped 34.57 points or 1.2 percent to 2,828.47 and the S&P 500 slid 10.88 points or 0.8 percent to 1,337.77. With the lower close on the day, the Dow and the S&P 500 posted modest weekly losses of 0.3 percent and 0.2 percent, respectively, while the NASDAQ was nearly unchanged for the week.


Saturday, May 14, 2011

Wall Street endures a brutal Friday the 13th

DJIA Takes 100-Point Hit as Euro Zone Fears Dominate; Major indexes down for the week
It was an unlucky Friday the 13th for investors, with the major market indexes taking a hit on fresh concerns about the fiscal health of the euro zone. Early optimism over solid GDP growth in Germany and France evaporated in the wake of a grim warning from European Central Bank official Juergen Stark, who asserted that a bailout of Greece would hardly be a cure-all. "I would warn against underestimating the massive harmful effects a debt restructuring would cause for the country involved and for the euro zone as a whole," said Stark. "It is very well conceivable that the risks for financial market stability could spread to other European countries." With cash-strapped Greece grabbing the spotlight, Wall Street seemed utterly uninspired by a generally decent round of domestic economic data, including in-line inflation figures and a stronger-than-forecast reading on consumer sentiment. Instead, traders cast a wary eye on a key meeting of euro zone finance ministers scheduled for Monday, and ultimately opted to take some cash off the table ahead of the weekend.

The Dow Jones Industrial Average (DJIA – 12,595.75) ended on a drop of 100.2 points, or 0.8%, as all but five of its 30 components ended lower. Travelers Companies (TRV) led the 25 laggards with a 2.4% pullback, while Kraft Foods (KFT) led the four advancing blue chips with a gain of 0.4%. Wal-Mart Stores (WMT) split the difference by finishing flat. Today marks the Dow's first close below its 20-day moving average since April 19, but the index remains well north of support at its rising 10-week trendline. For the week, the Dow gave up 0.3%.

The S&P 500 Index (SPX – 1,337.77) gave up 10.9 points, or 0.8%, and breached its own 20-day moving average for the first time in nearly a month. The Nasdaq Composite (COMP – 2,828.47) suffered the session's largest percentage drop, shedding 34.6 points, or 1.2%, by the time the closing bell sounded. In the process, the COMP ended less than one point below its 20-day trendline. The SPX declined 0.2% for the week, while the COMP barely budged, up just 0.03% from last Friday's close.

There’s a lot of question marks to the economic recovery at the same time the Fed is about to take [quantitative easing two] away, and just like with any drug addict, there’s a period of withdrawal.”

“Now that earnings season is behind us, there is currently no good news to push stocks higher until we start to get the next quarter’s expectations, which should be very good.” 

Crude fight back in late trading
Crude futures eked out a last-minute gain today, but settled just south of the psychologically significant century mark. The U.S. dollar's rise against the euro kept black gold under pressure for most of the session, but the threat of refinery disruptions along the swollen banks of the Mississippi River helped generate some minor buying interest ahead of the weekend. Crude oil for June delivery added 68 cents, or 0.7%, to end at $99.65 per barrel. For the week, the contract gained 2.5%.

Friday, May 13, 2011

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Thursday, May 12, 2011

FBM KLCI 12/05/2011 每日技术分析 Daily Technical Analysis

综合指数 2011年 05月 12日






Wednesday, May 11, 2011

ZLBT Morning View >>> Bursa Malaysia Holding On Weak Rebound

KL Stock Market May Extend Gains
The Malaysian stock market has finished higher now in back-to-back sessions, collecting 8 points or 0.5 percent in the process. The Kuala Lumpur Composite Index finished just above the 1,520-point plateau, and now analysts are forecasting continued support at the opening of trade on Wednesday.

The global forecast for the Asian markets is fairly positive thanks largely to merger-and-acquisition activity. Technology stocks and properties figure to be the key beneficiaries, while gold stocks may fall on profit taking. The European and U.S. markets finished higher on Tuesday, and the Asian bourses also are tipped to track higher.

The KLCI finished slightly higher on Tuesday, nudged into the green by gains from the financial shares, industrial issues and plantation stocks.
For the day, the index added 3.96 points or 0.26 percent to finish at 1,523.37 after trading between 1,518.15 and 1,525.78. Volume was 847.99 million shares worth 1.15 billion ringgit. There were 359 gainers and 344 decliners, with 330 stocks finishing unchanged.

Among the gainers, Hong Leong Bank, Hong Leong Financial Group, Mclean Technologies, Maybank, CIMB Holdings, Sime Darby and Petronas Chemicals all finished higher.

Hong Leong Bank gained 30 sen to RM11.50 while Hong Leong Financial Group advanced 36 sen to RM11.14. HwangDBS Vickers Research said EON Capital's earnings would be included in Hong Leong Bank's books from today and it expected the assets and liabilities of EON Capital to be vested in Hong Leong Bank on July 1.

"With the stronger balance sheet and greater financial muscle, Hong Leong Bank will be able to look at growth beyond Malaysia to meet its regional aspirations," it said in a research note.
In economic news, Malaysia will on Wednesday announce March figures for industrial production, with forecasts calling for an increase of 3.4 percent on year. That follows the 5.0 percent annual expansion in February.

DJIA 3rd Day Win On Low Volume
The lead from Wall Street is optimistic as stocks showed a strong upward move during trading on Tuesday, adding to the gains posted in the previous session and further recovering from last week's losses. The markets benefited from additional merger-and-acquisition activity, with the recent string of multi-billion acquisition agreements seen as a sign of corporate confidence in the economic outlook.

The major averages closed firmly in positive territory, with the NASDAQ just below last Friday's ten-year closing high. The Dow climbed 75.68 points or 0.6 percent to 12,760.36, the NASDAQ rose 28.64 points or 1 percent to 2,871.89 and the S&P 500 advanced 10.87 points or 0.8 percent to 1,357.16.

Meanwhile FBM KLCI futures on Bursa Malaysia Derivatives closed higher in line with the cash market. The May and September 2011 rose 3 points to 1,520.5 and 1,519 respectively, June rose 2 points to 1,519 while December stood at 1,512. Volume slipped to 4,637 lots from Monday's 6,939 while open interest was lower at 16,904 contracts from 19,236 previously.


Tuesday, May 10, 2011

ZLBT Morning Viewd >>> Bursa Malaysia / Wall Street

Malaysian Stocks May Add To Rebound

The Malaysian stock market on Monday snapped the five-day losing streak in which it had declined more than 20 points or 1.4 percent. The Kuala Lumpur Composite Index finished just below the 1,515-point plateau, although now traders are looking for continued strength when the market kicks off trade on Tuesday.
The global forecast for the Asian markets is cautiously optimistic thanks to a solid rebound in the commodities markets following last week's heavy selling. The upside may be limited, however, by renewed debt concerns from Greece. The European markets finished lower and the U.S. bourses were higher, and the Asian markets generally figure to tick slightly higher.
The KLCI finished slightly higher on Monday on gains from the property stocks, financials and plantations.
For the day, the index added 3.91 points or 0.26 percent to finish at 1,519.41 after trading between 1,519.16 and 1,507.64. Volume was 716.24 million shares worth 1.075 billion ringgit. There were 394 decliners and 305 gainers.
Among the actives, Digi.com, Axiata and IOI Corporation all finished higher, while Tenaga Nasional, YTL, Petronas Chemical and Sime Darby ended lower.

DJIA Rises Along With Commpdities Rebound
The lead from Wall Street is fairly positive as stocks moved mostly higher on Monday, with commodity prices rebounding following last week's sell-off. The markets benefited from considerable strength among resource stocks, which had helped to lead the way lower last week.

The major averages ended the session off their best levels of the day but still posted moderate gains. The Dow rose by 45.94 points or 0.4 percent to 12,684.68, the NASDAQ climbed 15.69 points or 0.6 percent to 2,843.25 and the S&P 500 advanced 6.09 points or 0.5 percent to 1,346.29.

The strength in the markets was largely due to gains by resource stocks, which rebounded along with commodities prices. Energy stocks posted particularly strong gains on the day amid a sharp rise by the price of crude oil. Crude for June delivery surged up by $5.37 to $102.5 a barrel after plummeting by nearly 15 percent last week to a nearly two-month closing low of $97.18 a barrel. The price of gold also showed a notable rebound, with gold for June delivery rising by $11.60 to $1,503.20 an ounce.

Meanwhile, traders largely shrugged off news that Standard & Poor's has lowered its long-term sovereign credit rating on Greece to B from BB-.

Among individual stocks, shares of Dollar Thrifty (DTG) surged up by 13.8 percent on news that Hertz Global (HTZ) has raised its offer to acquire the car rental company in an effort to outbid rival Avis Budget Group (CAR). Hertz said it has offered to acquire Dollar Thrifty for $72 per share, consisting of $57.60 in cash and 0.8546 shares of Hertz. The company claimed that its offer represents a 24 percent premium to the offer made by Avis.

Fast food giant McDonald's (MCD) also closed higher after the company said that its global comparable store sales for April rose 6 percent, faster than the 4.9 percent increase in the year-ago period. Comparable sales in the U.S. rose by 4 percent.

On the other hand, Tyson Foods (TSN) fell by 6 percent after reporting second quarter earnings of $0.42 per share, flat with last year and a penny below analyst estimates. The meat producer said its sales for the quarter rose to $8 billion, exceeding the $7.55 billion consensus estimate. Tyson also said it expects 2011 sales to exceed $32 billion, mostly due to price increases. Analysts had expected revenues for the year of $31.0 billion.