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Sunday, October 24, 2010

Asia Pacific Index Chart Patterns – 1 year charts

Three weeks back, I had posted the 5 years chart patterns of the Asia Pacific indices. Today, let us take a look at the 1 year chart patterns.

Shanghai Composite Index Chart


The Shanghai Composite index chart has risen sharply above the 200 day EMA. The 20 day EMA has done the same after remaining entangled with the 50 day EMA for two months. The 50 day EMA is about to cross above the 200 day EMA to confirm a return to the bull market after 6 months.

Such a sharp rise is usually followed by a correction or consolidation. That would provide opportunities to add. Note that the RSI has made a higher top than the one in Apr ‘10, when the index was higher. The positive divergence is encouraging for the bulls.

Hang Seng Index Chart


The Hang Seng index chart pattern reached a 52 week high supported by strong volumes. All three EMAs are moving up with the index above them – a bullish sign.

The RSI has dropped from the overbought zone and failed to make a new high. Use corrections to add.

Taiwan TSEC Index Chart


The Taiwan TSEC index chart had a small correction and dropped below the 20 day EMA down to the rising 50 day EMA after testing the Apr ‘10 top, but has bounced up above the 20 day EMA. Except for a brief stay below the 200 day EMA in May and Jun ‘10, the index has remained above the rising long-term moving average through the year. Sign of a bull market.

The RSI has dropped below the 50% level. There may be a bit of consolidation before the TSEC can move up above the Jan ‘10 top.

Australia All Ordinaries Index Chart


The Australia All Ordinaries index chart is taking support from the 20 day EMA on its way up. The up move that started from the Jul ‘10 low has taken the index above the 200 day EMA, but the Apr ‘10 top may prove to be a tough hurdle.

The RSI is above the 50% level, but has made progressively lower tops as the index moved higher during Sep and Oct ‘10. The negative divergence could be indicating a consolidation before the next up move.

New Zealand NZX50 Index Chart


The New Zealand NZX50 index chart has rallied much more spiritedly since the Jul ‘10 low and has almost regained its losses. Volumes haven’t been all that great.

The RSI is rising above the 50% level, but has made lower tops as the index rose higher. A correction in the offing? Any dips can be used to add. 

Korea KOSPI Index Chart


The Korea KOSPI index chart has been in a bull market through the past year, with the index remaining above the rising 200 day EMA. Twice it sought support from the long-term moving average and resumed its upward move immediately thereafter.

The RSI has dropped to the 50% level while the index consolidated sideways after touching the 1900 mark. Use dips to add.

Malaysia KLCI Index Chart


The Malaysia KLCI index chart has also been in a bull market during the past 12 months. The dip below the 200 day EMA in Jan ‘10 appears to be a data error or a freak trade. Volumes have picked up considerably, which is a bullish sign.

The RSI is above the 50% level, but made a lower top as the index touched the all-time high of 1500. Any corrections will provide opportunities to add.

Singapore Straits Times Index Chart


The Singapore Straits Times charts is in a bull market and touching new highs on a regular basis. The same can not be said about the RSI, which has been making lower tops. Use corrections or consolidations to add.

Jakarta Composite Index Chart


The Jakarta Composite index chart has been the best performer among the Asia Pacific indices during the past 12 months. It is consolidating sideways after crossing the 3500 level. Volumes have remained strong.

The RSI has dropped from the overbought zone towards the 50% level, hinting at a possible correction. Use it to add.

Japan Nikkei Index Chart


The Japan Nikkei index chart is unable to extricate itself from a tight bear grasp, as it keeps sliding below a falling 200 day EMA. A brief up move on good volumes found strong resistance from the long-term moving average.

The RSI has dipped below the 50% level. Looks like there is no end to the misery of the Nikkei index.

Bottomline? The one year chart patterns of the Asia Pacific indices – except the Nikkei - are looking stronger by the day. Jakarta Composite and Malaysia KLCI remain the two best performers. Singapore Straits Times, KOSPI Korea and Taiwan TSEC are the next three that have done well. Stay invested, or add on dips with adequate stop-losses. Investors in Nikkei should get out and redeploy in neighbouring indices.

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