PSE Outlook of the Week

 

Figure 1. PSE Price Chart

Price and moving averages:

PSEi has closed above its Short time moving average.
Short time moving average is currently above mid-time, and above long time moving averages.
The relationship between price and moving averages is: bullish in short-term, and bullish in mid-long term.

Bollinger Bands:

PSEi has closed below upper band by 2.9%.
Bollinger Bands are 54.9% narrower than normal.
The narrow width of the bands suggests low volatility as compared to its normal range.  Therefore, the probability of volatility increasing with a sharp price move has increased for the near-term. The bands have been in this narrow range for 17 bars. The probability of a significant price move increases the longer the bands remain in this narrow range.

Volatility:
PSE volatility is still below average.
50 day Historical Volatility is 16% (desired: greater than 40%).
6/100 day ratio Historical Volatility is 0.77 ( desired: less than 0.50).

Trend Direction and Strength:
PSE is moving sideways to up and its trend strength is still weak.

Support/Resistance Lines:
Support: 3072
Resistance: 3130

Figure 2. Other Technical Indicators

PSE is bullish right now. This is based from the RSI reading above 50 and MACD value above zero line. Also since momentum is weak and Stochastic is at overbought, the overall market has a tendency to move sideways in the near term. Range trade between its support and resistance lines.

This week look to buy at Service and Industrial sectors. Be cautious with Property sector.