Surprised with the recent decline in the Philippine Stock Exchange Index (symbol: PSEi)? If you are a regular reader of our blog, you shouldn’t be, since I’ve talked about retracements for a few weeks now. It’s a no-brainer really, as the index has enjoyed a steady rally recently.
Since the ascending trendline has broken, you should focus on what will happen next.
The ideal scenario for this coming week is a move back toward 6,500. See if buyers would be able to gain back control of this level. If sellers will prevail, buyers should protect the 6,000 level at all cost.
Given that price has given way to a retracement, I expect exciting price action during the last 2 weeks of March. I hope it ends well, though. We’ll take this 1 week, 1 month at a time.
Key areas to watch:
Support: 6,000, 6,200-6,300
Reference chart: http://www.tradingphoenix.net/2013/12/30/psei-the-year-ahead/