Figure 1: PSE Index Chart
Last week, the RSI of our index has finally broken its down trendline resistance. This is an early bullish trend reversal signal for the index is yet to break its down trendline. This week I am expecting our index to correct upon reaching the area around the 20 MA line.Current index momentum is still strongly bias downward. In my opinion I don't think it is ready to break that 20 MA barrier unless there is a strong catalyst to do so. Our index is now at short term overbought area. High probability to somewhat correct/consolidate first to gather up some strength to continue moving up. There is also a gap which needed to be filled around the 3900 level. We should keep watch of the critical major support areas of our index.
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