Bursa KLCI

22 August 2018 – A Short Pullback

Indices
Dow Transportation closed at 11322.24 with a bearish marubozu candle above its 8 EMA, 21 EMA and 50 SMA. Daily trading range was 116.66. Intermediate Cycle is positive and rising slope. Short Term Cycle is positive and rising slope. Market direction – Buy. Fractal Bias – Bullish.

Dow Industrial closed at 25733.60 with a bearish candle above its 8 EMA, 21 EMA and 50 SMA. Daily trading range was 103.73. Intermediate Cycle is positive and rising slope. Short Cycle is positive and rising slope. Market direction – Buy. Fractal Bias – Bullish.

Russell 2000 closed at 1722.5424 with a small bullish marubozu candle above its 8 EMA, 21 EMA and 50 SMA. Daily trading range was 7.21. Intermediate Cycle is positive and rising. Short Cycle is positive and rising. Market direction: Buy. Fractal Bias – Bullish.

Nasdaq 100 closed at 7424.5956 with a bullish candle above its 8 EMA, 21 EMA and 50 SMA. Daily trading range was 59.79. Intermediate Cycle is positive and falling slope. Short Cycle is positive and falling slope. Market direction: Sell. Fractal Bias – Bearish.

S&P 500 closed at 2861.82 with a doji candle above its 8 EMA, 21 EMA and 50 SMA. Daily trading range was 11.49. Intermediate Cycle is positive and rising slope. Short Cycle is positive and rising slope. Market direction: Buy. Fractal Bias – Bullish.

Metals and Commodities
WTI Crude oil futures (CL) closed at $68.11 per barrel with a bullish candle above its 8 EMA and 21 EMA and below its 50 SMA. Daily trading range was 2.17. Intermediate Cycle is negative and rising slope. Short Cycle is negative and rising slope. Market direction: Buy. Fractal Bias – Bearish.

Gold futures (GC) closed at 1202.5 with a doji candle above its 8 EMA and below its 21 EMA and 50 SMA. Daily trading range was 9.2. Intermediate Cycle is negative and rising slope. Short Cycle is negative and rising slope. Market direction: Buy. Fractal Bias – Bearish.

Agriculture (DBA) ETF closed at 17.14 with a hammer candle below its 8 EMA, 21 EMA and 50 SMA. Daily trading range was 0.13. Intermediate Cycle is negative and rising slope. Short Cycle is negative and falling slope. Market direction: Buy. Fractal Bias – Bearish.

Commodities (DBC) ETF closed at 17.11 with a bullish candle above its 8 EMA and 21 EMA and below its 50 SMA. Daily trading range was 0.18. Intermediate Cycle is negative and rising slope. Short Cycle is negative and rising slope. Market direction: Buy. Fractal Bias – Bearish.

Bonds
Bond futures (/ZB) closed at 145’15 with a spinning top candle above its 8 EMA, 21 EMA and 50 SMA. Daily trading range was 0.5625. Intermediate Cycle is positive and rising slope. Short Cycle is positive and rising slope. Market direction: Buy. Fractal Bias – Bullish.

High Yield bond ETF (HYG) closed at 86.24 with a bullish candle above its 8 EMA, 21 EMA and 50 SMA. Daily trading range was 0.085. Intermediate Cycle is positive and rising slope. Short Cycle is positive and rising slope. Market direction: Buy. It is in a daily and weekly Squeeze. Fractal Bias – Bullish.

Currency
The dollar index ($DXY) closed at 95.085 with a spinning top doji candle below its 8 EMA and 21 EMA and above its 50 SMA. Daily trading range was 0.4429. Intermediate Cycle is positive and falling slope. Short Cycle is positive and falling slope. Market direction: Sell. Fractal Bias – Bullish.

EUR/USD closed at 1.1569 with a bullish candle above its 8 EMA and 21 EMA and below its 50 SMA. Daily trading range was 0.0069. Intermediate Cycle is negative and rising. Short Cycle is negative and rising. Market direction: Buy. Fractal Bias – Bearish.

USD/JPY closed at 110.54 with a bullish candle below its 8 EMA, 21 EMA and 50 SMA. Daily trading range was 0.774. Intermediate Cycle is negative and falling slope. Short Cycle is negative and falling slope. Market direction: Neutral. It is in a Squeeze. Fractal Bias – Bearish.

6S (Swiss Franc) – closed at 1.0192 with a bullish candle above its 8 EMA, 21 EMA and 50 SMA. Daily trading range was 0.0025. Intermediate Cycle is positive and rising. Short Cycle is positive and rising. Market direction: Buy. It is in a daily and weekly Squeeze. Fractal Bias – Bullish.

Relative Strength – Sectors On a monthly lookback, the relative strength order of the ETFs that are outperforming the S&P 500 are XLV, XLK, XLY, XLE, XLI, XLP, XLU and XLB.

On a 3-monthly lookback, the relative strength order of the ETFs that are outperforming the S&P 500 are XLV, XLU, XLP, XLY, XLI, XLF and XLK respectively.

Market Internals
Market sentiment is Bullish. Market breadth has flattened showing as many gainers as losers. Volume Accumulation/ Distribution is rising and shows nett accumulation. Skew is at 143.75. Vix is at 12.25 and Vix futures is at 14.30.

The Week Ahead
Skew continues to be elevated for the past few weeks. Vix is below 13 and Vix futures has risen to above 14 indicating a near term volatility. Market internals are showing strength. The prognosis is for a bullish bias but caution is warranted as the US dollar loses strength.

To YOUR wealth!

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