Market slowly moving up...

Looks like market is holding well above 1700 for KLCI Index and for Hang Seng Index, holding well above 20300. Is the bull getting tired? If you are holding shares which has paper profit, will you take profit now or wait a little longer? Maybe market might move differently after the Brussels Attack this afternoon. 

Hang Seng Index spot futures lost 68 points finished at 20607; cash market ended at 20666.75 (-17.40) at today's closing. FBM KLCI Index gained 6.39 points settled at 1724.75 while March futures ended up 4.50 points at 1724.00 on Tuesday evening. 

We see immediate resistance for KLCI Index at 1725. Next target 1750. Any correction will send market close to 1700. For HSI, immediate resistance is seen at 20850. If market can break above this level, there is a chance market will retest 21000. On the downside, supports at 20300, further at 19800.

On a separate note, USD is soften. We managed to see 1USD~RM3.99 today. While there are so many analysts out there predict whether is now the beginning of bull market or continuation of bear market, we think it is ok to stay invest in stock market and occasionally hedge against the futures market. Meanwhile, we had set aside some capital for property market too, although it is not cheap to get one now. If not now, then when?

Bull market? Or bear trap?

The market continued its gain this week. Hang Seng Index March futures gained 232 points closed at 20237 on Friday evening; cash market settled at 20199.60, up 215.18 or 1.08 percent.

Although tight range, it has been a volatile week, a fight between the bull and bear. The range of the week for spot futures was traded between 19813-20298 (485).

With overnight Dow Jones finished up 218.18 settled at 17213.31; market will open higher on Monday.  Resistance for HSI is seen at 20863, next is Daily SMA100-21017. Higher target 21500. Will market go that far next week? Or the end of rebound? We'll see. On the downside, 20300 had become the immediate support, next 19820; further down 19300.

In Malaysia, the market finally broke above 1700. FBM KLCI Index gained 5.63 points finished at 1696.54 on Friday evening; March futures ended up 6.00 points at 1697.50. Resistance for KLCI futures is seen at 1725, next 1775. Downside support is 1690, next 1675.

Is negative interest rate a new trend?

The European Central Bank (ECB) had just announced cutting its main refinancing rate to 0.0 percent, cut deposit rate to minus 0.4 percent and extended its monthly asset purchase to $80 billion euros, effective from April. Dow Jones was up 100 points in the early trade, taking this as a positive news to cheer market.

But honestly, is the negative interest rate a positive news to the market? Is it now a new trend for the central banks to practice negative rates? What are the effects to the consumers and economy?

Negative interest rates is now practised in five countries- The ECB, Japan, Denmark, Sweden and Switzerland. Negative interest rates means the central bank will charge negative interest, meaning the money depositors deposit doesn't grow; in fact depositors need to pay regularly to keep money in the bank.

The purpose of practise negative interest rate is to stimulate economy, to encourage people and business to spend money instead of saving money. But hey, in long term, does it really help the economy? Will depositors cash out from banks and put the money under the pillow? Will it cause another banking crisis? 

Let's see what the experts say.

http://www.investopedia.com/terms/n/negative-interest-rate-policy-nirp.asp

http://www.cnbc.com/2016/03/10/negative-interest-rates-positive-side-commentary.html

http://www.cnbc.com/2016/03/07/negative-interest-rates-a-dangerous-weapon-commentary.html

http://money.cnn.com/2016/03/07/news/economy/negative-rates-central-banks-bis-report/

Market up since March

The Asia market ended higher this week, with Hang Seng Index closed up four consecutive days since the first day of March.

This week, the trading range for Hang Seng Index March futures contract was range between 18960-20184 (1224), closed at 20100 (+239), successfully hold above daily MA10 and MA20. Cash market ended at 20176.70, gain 234.94 points or 1.18 percent.

With overnight Dow Jones closed up 62.87 @ 17006.77, we expect the uptrend to be continued, possible with profit taking or small correction. The immediate resistance is expected at 20260, next 20600. Downside support 19950, 19770, further support-19200. 

In KL, March futures contract traded between 1646.0-1699.0 (53.0) since beginning of March. Spot futures gain 9 points, finished at 1695.90 on Friday evening; cash market settled at 1692.49 (+4.29). Upside resistance is seen at 1725 for KLCI futures. If this level is broken, a new uptrend will be formed. On the downside, supports is seen at 1690, next 1670.

We added a few stocks into our holdings. In Australia, a digital media company named Netccentric which was listed in ASX since last June; in Hong Kong, Tracker fund of Hong Kong (HK:2800) and Shun Tak Holdings (HK:242).

Rally begin?

Following US Dow Jones surged 348.58 at closing on Super Tuesday, Asia market all closed in positive territory, with Nikkei and Shanghai market closed more than 4 percent. 

Hang Seng Index futures opened at 19645, 321 points gap up above yesterday's closing price. The market was so excited it continued climbing to highest at 19995 in the afternoon before it settled at 19890 (+566). Cash market was traded to highest 20058.12, finished at 20003.49, gained 596.03 points or 3.07 percent, with a turnover of 92.68 billion. Hang Seng Index broke all the resistance we expected; currently we see immediate resistance at 20000, next 20260; supports-19750, next 19400. 

FBM KLCI Index surged 20.21 points closed at 1691.03. The March futures contract gained 16.50 points, finished at 1687.50. Today's range for spot month futures was trading between 1679.00-1689.50 (10.50). Resistance for KLCI futures-1700, next 1720.