Today is the 5th consecutive day of KLCI index tumbled, due to the investors worry of China recent credit tightening move and Obama's speech recently. And, it is the longest bearish rally with largest drop of 43 points since mid of March on last year.
From the look at it, almost all shares are affected, banking sector facing the worst drop among the blue chips. As for other industry, rubber glove sector is the worst as most of shares retrace at least 50% since 15 Jan 2010. And last 2 days are the worst as rubber glove sector were downgraded by MIDF Research from 'Overweight' to 'Neutral'. They downgraded this sector due to concerns over sustainability of global glove demand growth, earning margin sustainability and expected excess glove production capacity.
After KLCI index has discounted for 43 points, overall the entire company share prices should look cheaper. There are two say. If you are using technical analysis, all indicators, breaking of 50 days moving average, and technical signals are indicating you to quit immediately after the fall of 17 points on yesterday.
From the fundamental analysis, this falls is just a normal correction or pullback, as most analyst and fund houses believe there is still upside for the local stock market. Right, the long bull rally needs some rests isn't it? We still can see many companies are turning loss into profits, getting higher profits, and the GDP & export statistics are improving.
So what do you say then?
I personally invest fully based on fundamental analysis, where I only use lightweight technical analysis (without any technical indicator) as my entry and exit guideline.
If you like this blog, please kindly subscribe to my full feed RSS. Happy investing.
Posts
0 comments:
Post a Comment