TM P.I. Capital Letter TM www.picapital.com.my Analyst: Fred Tam, MPHIL, MFTA, CFTe, MSTA, ACCA KNOW WHEN TO ENTER & EXIT THE MARKETS TEL: 03-2145-5877, 2148-9137 Monday 09/04/2012 FAX: 03-2145-5755Subscriber issue: Year 19/Issue 060 Circulation Strictly Prohibited PP8228/02/2012 No of pages: 7All rights reserved. No part of this work, publication and compilation may be reproduced, circulated or transmitted in any form or by any means in any medium (electronic or otherwise), or stored in any retrievalsystem of any nature, whether or not transiently or incidentally to some other use of this work, publication and compilation, without the prior written permission or in accordance with the terms of a licenseissued by the copyright owner. Application for permission for other use other than permitted use of this copyrighted material including permission to reproduce extracts in other published or unpublished worksshall be made to the copyright owner. Warning: This work, publication and compilation are protected by copyright law and international treaties. The doing of an unauthorized act in relation to this copyright workmay result in both a civil claim, amongst others, for substantial damage and criminal prosecution. Offenders will be prosecuted to the maximum extent possible under the law. MALAYSIAN EQUITY INDICES-TO-WATCH:No Stock Index Close +/- Rec. Resistance Support Daily Stop Trend Remarks 06/04/12 (Up Target) (Down target) Mom Loss* Ind. 1 KLSE COMP 1598.87 +5.43 Buy 1603hit!/1718 1581 37 - Bullish Expect rebound 2 KLTECH 17.67 -0.07 H 26.90 - -0.94 - Bullish See trend ind.Note: If Momentum < 0 = Bearish, momentum > 0 = Bullish. This is only a guide. There are times when Mom whipsaws around the 0 level. MOM=40DAY MALAYSIAN FUTURES-TO-WATCH:No. Futures Close +/- PI Entry Rec. Target Fractal Remark 06/04/12 Price Stop1 FKLI (APR) 1595.5 +5.5 1590 (L) Buy (Long) Upside:1603hit/1700 1578 OL S-T: Mini Wave 5 up Downside: 1578 L-T(wkly): W5 UP2 CPO (JUN) 3604 +46 3541 (L) Re-enter Long Upside: 3510hit/3700 3530 OL S-T: Mini W5 up Downside:2430 L-T: Major W5 up FOREX, GOLD & LIGHT CRUDE OIL-TO-WATCH PRICE TARGET STFOREX PAIRS 06/04/12 ENTRY PRICE TREND POSITION STOP LOSS 1 2ND 3RD 1.4180 EUR / USD 1.3079 1.3420 (L) Pullback MAINTAIN LONG - (hit) 1.4740 - GBP / USD 1.5879 1.5472 (L) Pullback MAINTAIN LONG - 1.6750 - - NZD / USD 0.8192 0.7713 (L) Pullback MAINTAIN LONG - - 0.8250 0.8760 AUD / USD 1.0309 0.9617 (L) Pullback MAINTAIN LONG - 1.0830 1.1560 - LOCO GOLD 1637 1637 (L) Pullback Go Long 1608 OL 2237 2717 5000L. CRUDE OIL 103.25 79.00 (L) Pullback MAINTAIN LONG - 106.77 114.94 - INDICES-TO-WATCH PRICE TARGET ST ND INDICES 05/04/12 ENTRY PRICE TREND POSITION STOP LOSS 1 2 3RD DJIA 13060 12240 (Buy) W5 Long - 12860 14026 - FTSE 100 5723 5790 (Buy) W5 Long - 6034 6768 -HSI (06/04/12) 20593 20739 (Buy) W5 Long - - 22324 - REMARKS : OL - Or Lower, OH - Or Higher, SA - Stay Aside, NA - Not Applicable, L – Long, S – Short, SW = Side WaysNEW STOCKS-TO-WATCH : GTRONICSTOCKS WITH SELL SIGNAL : -STOCKS WITH TAKE PROFIT SIGNAL : -EXISTING STOCKS-TO-WATCH : YTL, TWS, ATLAN, AXIATA, OLDTOWN*, UNISEMPI WEEKLY COMMENTS FOR MONDAY, APR 9, 2012: KLCI LIKELY TO STAY FIRM AND EVEN HIGHERNEXT WEEK AS WEAK MARCH JOB DATA IN U.S. MAY FORCE QE3. ACCUMULATE/HOLD.NEW STOCK-TO-WATCH: GTRONIC.STOCKS WITH SELL SIGNAL: NIL.TAKE PROFIT SIGNAL: NIL.EXISTING STOCKS-TO-WATCH: YTL, TWS, ATLAN, AXIATA, OLDTOWN*, UNISEM.This stock market research newsletter is based on pure technical analysis. Statements and comments are subject to the limitations inherent in this technique of analysis and may change due tounforeseen circumstances. Those wishing to trade are advised to use money management strategies to avoid getting over exposed in the event the market makes a sudden trend reversal. P.I.Graduate’s comments should not be construed as a solicitation to buy or sell any stock referred to. P.I. Graduate or its staff may have positions in the stocks covered. P.I. Graduate shall not beliable for any losses suffered by the subscriber from following our analysis. This daily newsletter is published by PI Graduate Studies Sdn Bhd (521589-H), 167A, Jalan Maharajalela, 50150 KualaLumpur.
Continuation Sheet 2COMMENTS FOR MONDAY (APR 9 2012): On Friday’s close the KLCI was up 5.43 points or 0.34% at1598.87 on lower volume of 1.27 billion shares traded. Advancers led decliners by 457 to 248 with 324stocks unchanged.1. DOES WEAK MARCH JOB REPORT DOOMS OBAMA ELECTION BID?: The March jobs report delivered a downside surprise with the economy adding only 120,000 new payrolls, while the unemployment rate ticked down to 8.2%.Politicians on both sides of the aisle will pounce on these numbers with the Presidential election just seven months away. The question still remains: Just how much will it impact votes in November?"I dont think there is a magic formula or a specific unemployment number that can guarantee the Presidents loss or victory in November," says Nathan Gonzales, deputy editor of the Rothenberg Political Report and founder of PoliticsInStereo.com. Gonzales says its more about the perception of the economy and not the actual data. If Americans believe the country is headed in the right direction, they will be less apt to change the leadership. This reality frustrates the White House he says, because voters could be susceptible to a sentiment that may or may not match the numbers. Jobs reports like the ones released today are important, but its more about the broader trend leading up to the election."If (the economy) starts to go down, theres more of a hiccup or a stalling…then that just plays right into the Republican hands being able to say look its time for a change, the Presidents policies arent working." If jobs numbers are the more cerebral data point, gas prices are the in your face indicator for the average American."If gas prices are high I think that leads to a little bit of sense the countrys not headed in the right direction," says Gonzales, "and that would fall on the shoulders of the incumbent president and people may be looking for a change once again."Regardless of the weakness in the March numbers, Gonzales expects the President to stress overall economic improvement over the course of his first term."The economy was so bad that relative to where we were, those numbers start to look better and I think thats what the president is banking on saying at least were not where we were — things could be worse." Such an argument is "very different from the hope and change message that we saw in 2008."Gonzales points out that the same metrics used to handicap the Presidential race are at play for Congress too. And the bottom line is not good for Democrats. If America wants a change theyll take it out on the President and his party and if they are happy with the status quo incumbents in both parties stand a better chance at staying in office. That would mean an increased likelihood that Republicans maintain control of the house. Will improving economic data lead to a second term for Obama, or will Republicans convince voters the country is headed in the wrong direction? Let us know in the comments below or visit us on2. GOLD PRICES GAIN AS U.S. EMPLOYERS ADD FEWER JOBS THAN FORECAST: Gold in London rose for a second straight day after U.S. employers added fewer than jobs than forecast, boosting prospects for the Federal Reserve to use additional stimulus measures to spur growth. Payrolls climbed by 120,000 in March, the Labor Department said today. Economists forecast a gain of 205,000, the median of 80 projections in a Bloomberg News survey. Minutes from a Fed policy meeting released this week indicated that the central bank will hold off on increasing monetary accommodation unless economic expansion falters. “There’s going to be this feeling that the Fed’s minutes that said easing was off the table is not going to pan out,” Michael Gayed, the chief investment strategist who helps oversee $150 million at New York-based Pension Partners LLC, said in a telephone interview. “We’re getting the consistent message that stimulus is good for gold.” Bullion for immediate delivery gained 0.6 percent to $1,640.25 an ounce at 8:49 a.m. New York time. Trading on the Comex in New York is closed today for Good Friday. Gold has surged about 85 percent since the end of 2008 as the Fed held borrowing costs at a record low and bought $2.3 trillion in housing and government debt.3. OUR COMMENTS: On Friday, an important statistic came out of the U.S. and that is March Job Report. U.S. employers added fewer than jobs than forecast, boosting prospects for the Federal Reserve to use additional stimulus measures to spur growth. Payrolls climbed by 120,000 in March, the Labor Department said today. Economists forecast a gain of 205,000, the median of 80 projections in a Bloomberg News survey. With this piece of news, we cannot rule out QE3 (Quantitative Easing 3) which indirectly means that the stocks markets, commodity markets including gold, silver etc, will rally further at the expense of a falling U.S. dollar. We would therefore continue to maintain our stand to “hold” onto selective index linked stocks and a few lower liners that we have called a “buy” earlier. Watch for further strength developing and unfolding as a result of Friday’s weak job report. Any further rise would imply the possibility of adding new positions to your portfolio.4. EXISTING STOCKS TO WATCH: YTL, TWS, ATLAN, AXIATA, OLDTOWN*, UNISEM.5. NEW STOCKS-TO-WATCH: GTRONIC. 2
Continuation Sheet 36. GOLD: Gold and silver are expected to rally on Monday with the release of a weak March job report. Hopes of QE3 are now rekindled. We would call a “buy if gold is above 1625 and 31.90 respectively.7. The ringgit steadied to 3.0630 from 3.0650.8. CONCLUSION: The KLCI’s correction is likely to give way to another round of rally on the KLCI next week. Chartwise, the long term trend is still up, as such it is a hold and a selective buy for the index stocks as mentioned above.Immediate Support is at 1581. Look to buy around this area - should it fall to this area.Upside Targets: 1603 hit (right on target!)/1718 (Revised targets on 02/03/2012)Immediate downside targets: 1581 (Revised on 4/4/12)Ichimoku kumo support (Span B): 1537 (Revised on 28/07/11) TRIPLE SCREEN READING WITH THE F-1 TRADER SYSTEMF1-Trader (Daily) – Triggered a “sell” signal on April 5, 2012 at 1593.44 (Will trigger buy signal @ 1609.17OH by today’s close)F1-Trader (Weekly) – Triggered a “buy” signal on Dec 2, 2011 at 1489.02 (Will trigger a weekly sell signal @1581,78 OL by Friday, April 13, 2012 close).F-1 Trader (Monthly) – Triggered a “buy” signal on Dec 30, 2011 at 1530.73 (Will trigger a monthly sellsignal @ 1526.02 or lower by April 30, 2012 close).F1-Trader Triple Screen: Sell-Buy-Buy” – Short-term Weak, Medium term Strong and Long Term Strong: 2screen BUY. Hold/Selective index stocks still strong. FOREX / GOLD-SILVER OUTLOOKFOREX (U.S. dollar likely to weaken back on weak March job report raising hopes of QE3.) Expectgold and silver to rally triggering a re-entry.) STOCK INDEX FUTURES OUTLOOKStock index futures: Maintain long/Sell stop 1576 OLAPR FKLI futures closed up 5.5 point to 1595.5 on lower volume of 3379 lots. 1. Our view remains unchanged. 2. We are now long and even further buy as the weak job data in U.S. is likely to trigger further rallies on world stock markets. 3. If you had bought above 1578, the sell stop will be at 1576 OL.General comment: Buy/Hold/F.B. Support at 1578. Sell @ 1576 OL.Upside targets:1603/1700 (Amended on 16/03/12)Downside targets: 1278/1228 (Amended on 24/09/11)Kumo resistance (Span A): 1572 (Updated on 28/07/11).Average True Range for KLFE: A.T.R. is 10.21 points for FKLI futures. This implies you need to put a stopabove/below this A.T.R. or you can get stopped out due to the volatility factor. We advocate a 1.5 x or 2 xthe ATR. We are using a 5 days ATR. CRUDE PALM OIL FUTURESCrude palm oil futures: Maintain long/F.B./Sell @ 3558 OLJUN CPO futures closed up by 46 points at 3640 on relatively high volume of 10239 lots. 1. Our view remains unchanged. 2. We are long and even “further buy” on a ‘pennant breakout’ pattern. 3. Next target is 3700. 4. Sell stop remains at 3558 OL. 5. General commentary: We have re-entered long. Aggressive traders can “further buy” as CPO staged a “pennant breakout”. Place sell stop @ 3558 OL.Up Targets: 3510 hit/3700 (Revised on 16/3/12).Down target: -NOTE: If you are an intra-day player or a trader with a small capital, you should NOT use these daily stopswhich is too much of a risk if it is triggered. We strongly suggest you to use the lower time frame charts anduse appropriate stops like pivot stops, 1,2 or 3-bar stops to protect losses.Average True Range for CPO: A.T.R. is 47.43 for CPO. This implies you need to put a stop above/below thisA.T.R. or you can get stopped out due to the volatility factor. We advocate a 1.5 x or 2 x the ATR. We areusing a 5 days ATR.No Name Index Close +/- Rec. Entry Support Entry Targets Daily Stop Trend Ind. Remarks Price Day RSI Loss* Construction1 AZRB 0.835 +0.01 SA 1.05 - 10/02/2012 1.42 37 - Bearish Stop Hit2 GAMUDA 3.59 0.00 H 2.25 2.95 - 184.108.40.206 45 3.56 Bearish Channel B.O 3