PSEi Outlook of the Week

Figure 1: PSE 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 4.4%.
Bollinger Bands are 24.8% narrower than normal.
The current width of the bands (alone) does not suggest anything conclusive about the future volatility or movement of prices.

Volatility:

PSEi is now getting more volatile as it closes last Friday above its 2 weeks average volume.

50 day Historical Volatility is 15% (desired: greater than 40%).
6/100 day ratio Historical Volatility is 0.35 ( desired: less than 0.50).

Trend Direction and Strength:
PSE is now moving upward in a weak trend strength.

Support/Resistance Lines:
Support: 3072
Resistance: 3130

Figure 2. Other technical indicators

PSE is bullish with a strong momentum to the upward direction. The question is will it be able to finally break its resistance at 3130? There is a some possibility that it will be able to finally break it this week as long as the upward momentum continuous to be strong. But at the same time I am also cautious because the stochastic already shows that it is at the overbought area and the price is also already at the top portion of the bollinger bands. A market consolidation is possible to happen soon.

This week look to enter for a buy in the Holdings sector. Be cautious in the Properties and Mining-Oil sectors.