Correction coming....

My son came down with a fever with cough. It was expected because the flu virus has been passing around the family and that he has taken a lot of heaty stuffs during CNY. We were actually anticipating this to happen. So it is again sleepless nights with scheduled medication in the middle of the night.

The only thing that I find strange is that he still has so much energy to play and enjoy himself. I recall when I was having fever as a child, it was quite hard to even walk, let alone play.


Fig 1 STI Weekly Chart

So STI went down one more time on Friday. The lucky thing is that it met with a resistance (previous high) of 3,052.62 and rebounded. It is also quite clear that it broke through the neckline of a double top which took 4 months to create. Assuming that it does not violate the rules again, the minimum objective of the double top is 2,945.


Fig 2 STI Daily Chart

On daily basis,it clearly show a 5 days drop and it broke through the 21 and 89 days moving averages. Moreover, it has also broken the long term trendline (quite some time ago). Its not a good sign so far.

The good part is that both RSI and stochastic is at the bottom which is an indication of over sold. So a rebound is due.


Fig 3 STI Daily line chart

I purposely add in the line chart this time, because it reveals a something different. What happened on 8th Feb 2011 caused a slow down in its descent. I have seen this kind of thing before. It is micro wave and the pause on the line indicated a counter wave. So what is the significance?

What I think is that the counter wave is a 2nd wave and it is followed by a 3rd wave. If this is so, 4th wave is next. So Monday is likely to be up but not for long and it tends to be irregular for a few days. It will follow by the 5th wave.

On a bigger picture, we could be well into the C wave of the whole counter wave pattern. Nov 2010 was A wave, Nov 2010 to 19th Jan 2011 is a B and now we are in the middle of C. The completion of the coming 5th wave only marks the completion of the 3rd of C wave, there will still be a 4th and 5th.