There’s no doubt that it was a strong market rally for quite sometimes. For the past 3 days, we can observe that the stock market drop due to having healthy correction to its uptrend. Will the correction continue tomorrow? The probability is not that high as it’s already drop to the level where it’s great time for trader to initiate ‘LONG’ position.
Last Friday 21st Jan 2011 market closing at 1543 after dropping 24.5pts. Previously, many analysts and financial experts hope that the correction can drag the index towards the 1550 – 1540 levels as it will help to garner enough strength to break through the 1600 level. So, I think it’s time for the index hit next target which is breaking through the 1600 level.
In my opinion, the market has more upside in the mid term to long term view. It can break 1600 level either this month or next month.
The immediate resistance for this week is seen at 1565 – 1570 levels and the support is seen at 1535 – 1540 levels.
My next plan is to exit FKLI at 10 pts profit target. With this plan, I think can be safer as you no need to worry till the end of the month. Another conservative plan is trying to trade at ‘below market price’ which lost not that much but win more than others.