· Our local benchmark starts anew with 30 new component stocks. Technically, CI remains to be caught in a consolidation mode with neither side willing to give in at the current juncture. Regional markets also provided little cue with most consolidating after having undergone a good run-up for the past three months or so.
· Looking at the weekly, CI is again gingerly above the uptrend line with support at the 1,055 – 1,060 levels. Weekly RSI we noticed is seemingly rolling over, lending some negative bias in the near to medium term. Resistance meanwhile can be expected at the 1,091 – 1,097 levels.
· Our strategy remains unchanged which is to sell into any rallies as we believe the risk / reward is becoming increasingly tilted towards the former as market moves higher. Harsh reality that the global economic slowdown still has legs could finally dawn upon investors thereby providing the necessary downside risk in the near to medium term.
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