PSEi: The Week Ahead, April 5, 2015

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The Philippine Stock Exchange Index (symbol: PSEi) traded on a shortened week, but it was able to make its mark into the 8,000 level and form a bullish end to March.

On Wednesday (April 1), the index reached a high of 7,993, which was also the day’s closing price.

Philippine Stock Exchange index_PSEi Daily chart, April 1, 2015

PSEi Daily chart, April 1, 2015 c/o COL

Key Areas List

The Key Areas list of the PSE index has changed slightly.

Key areas to watch:
Resistance: 8,000, 8,500, 9,000
Support: 7,900, 7,500-7,700, 7,300

New reference chart:

The Script

It seems more bears, than bulls, were on vacation this week. :)

The bulls did a great job at pushing the index higher in March.

The initial pullback from the 8,000 level was minimal so far. I like that price is not rushing through 8,000 so easily — this is healthier price action and better for most.

If bulls can keep control, this time above 7,900 (see black line on chart), then they can have a solid foundation right around the 8,000 level as they launch higher to tougher resistance (see Key Areas list above). I’ve heard and read that some brokers and “gurus” expected a 2015 top below 8,000, but I have kept my eye open for higher ground since the start of the year (as seen in the Key Areas list and Yearly Analysis). I balance this optimism with a constantly-cautious and objective look at the charts.

I would prefer to see consolidation near the current price area, or a new weekly high. If the index decides to decline and rest, 7,800-7,900 would be a good area (otherwise, there could be trouble ahead).

Would bulls be on vacation mode this new week? We’ll see.


I almost forgot to point out that you need to be careful with a possible global black swan event this week and the next:
– April 9 (Thursday) is the deadline for Greece to pay its debt to IMF (EUR450 million).
– April 14 and 17 (Tuesday and Wednesday) are dates when Greek Treasury bills mature (EUR2.4 BILLION total).

If Greece misses its payment dates and goes ahead to pursue the use of Greek Drachma (their national currency), we could see some fireworks in stock markets around the world.

Where do you think the index will head to this coming week? Share your thoughts below and Like our Facebook page as well!

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