Wednesday, October 29, 2008

Cheap Sales (1): Banks

Finance Sector Index Monthly Chart

Dropping from a cliff. Next possible support is at 5000.

AMMB Monthly Chart

Uptrend line broken. Possible supports: 1.80, 1.30.

Commerz Monthly Chart

Approaching its last uptrend line.
HLBank Monthly Chart

Uptrend line broken. Only starting to break down. Possible supports: 4.00, 3.00.

Maybank Monthly Chart

At possible support point of 5.00. Next are 3.50 and 2.50.

PBBank Monthly Chart

Resting on its uptrend line. Next possible support is around 6.50 to 7.00. Technically, this is the strongest among the banks.

RHBCap Monthly Chart

Resting at its uptrend line.

Based on the monthly chart's RSI reading, it seems that all the banks can fall some more because the monthly RSI is not oversold yet. In the 1997 crisis, the RSI managed to go under 30 before the prices recover. You can also notice that a bottom takes about 6-12 months to form. So don't worry that you have missed it. It is best to pay 10% more for a sure bottom than catching a falling knife.

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