KLCI waves 41 - New Implusive Bull Waves or Dead Cat Bounce ? - Update

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Publish date: Sun, 17 Jan 2021, 06:42 PM

Weekly Time Frame

To recap, there was an Hammer candle formed with high volume and it required confirmation from next candle to close above 1633.19 convincingly on last Friday. However, it was still unable to close above 1633.19 and caution is still required for any knee jerk reaction possible before the Bull recharged. Since KLCI is still staying above 1610, further consolidation phase may take longer than expected before a clear signal to either direction. 1610 and 1633.19 are still the levels to watch next Friday.

To reiterate, the correction waves are still being constrcuted after Wave 5 has been realized at 1695.87 instead of 1695.96. Subsequent minor waves would be elaborated further in daily time frame.

1) -DMI (red line) curved down with reasonable margin indicates bearish momentum is decreasing.

2) +DMI (blue line) still heading down with narrow margin indicates bull strenght is decreasing with slower pace and it still hovering below R2 indicates caution mode is required.

3) ADX (pink line) still heading down with narrow margin implying that the volatility of the current uptrend is still decreasing with slower pace.

Therefore, the summations of the 3 signals above is still implying uncertainty is still emerging with narrow margin and caution is still required for any unexpected knee jerk reaction. From current situaton, the spread in between +DMI and -DMI is increasing with +DMI is still above -DMI indicates bull strenght is still in favor with lower volatility. Therefore, a continuous increased in ADX reading is still required in order to validate a prominent trend to be developed. Eventhough these indicators still showing some weakness, the current price actions with candle formartion signal mentioned above might lead to turn around.

Prevailing trend could be emerged if Weekly levels listed below was broken:

Resistance - 1720

Immediate Resistance - 1635, 1642, 1650, 1700

Immediate Support - 1621-1624, 1610

Support - 1593, 1577, 1564, 1556,1530, 1490, 1440 (DT line)

Daily Time Frame

To recap, we were in the midst of a new structure of Higher Degree of Correciton which believed to be formed with 5-3-5 structure correction waves [ (i-ii-iii-iv-v (A) - a-b-c - (B) - i-ii-iii-iv-v (C)} as showned. Wave C had been realized at 1572.62 (50% Fibo) and rebound strongly. If the rebound momentum continue and sustainable, implusive Wave 1 could have being formed and confirmation would be validated if it can go towards or breach above Wave B (1655.96). Otherwise, i would consider the current rebound was an dead cat bounce and Complex Correction Waves could be emerged before a new set of Impulsive Bull Waves.

For the past 1 week, KLCI had made a high of 1646.24 before an minor retracement. Due to no confirmation of Wave 1 validation yet, i assume that i th sub minuette of iii rd sub minuette wave is being constructed as labelled currently as long as the low of ii nd sub minuette wave (1590.71) can hold the ground. Otherwise, the prior low of Wave C (1572.62) could be threatening. No doubt that the high of Wave B (1655.96) is still the level to watch for validating the potential of Wave 1 construction.

The entire wave structures will still be monitored closely if the low of Wave C at 1572.62 is breached as more complexity correction wave formations could be emerged such as multiple WXY correction waves may take place before new set of Higher Degree of 5 Waves Bull Run.

All waves' count and projected target are generated based on past/current price level and it may be subjected to vary if degree of momentum movement change.

Prevailing trend could be emerged if Daily levels listed below was broken:

Resistance - 1720

Immediate resistance - 1639-1631, 1650, 1662, 1679, 1685, 1700

Immediate Support - 1620, 1615, 1610, 1590, 1570 (Apex), 1560, 1554

Support - 1538-1545, 1530, 1490

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All the major Gloves stock is still constructing an similar correction phase unless prior low does not hold. However, i won't rule out that Rotational Blue Chip play would take place for initiating an impending growth of KLCI.

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Patient is required for the Implusive Waves of the SUPER CYCLE Bull Run.

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Let's Mr Market pave the waves.

Trade safely

Wave Believer

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