After hitting a snag for several months now, it appears that the Philippine Stock Exchange Composite Index (PCOMP) or the PSEi has found its winning shape again. Presently, things looks more upbeat now, at least from the technical point of view, for the Philippine economy as it is represented by the local equities index.
You see, the index had been trading within a descending channel since November of last year as I’ve pointed out in my recent post just the other day (please see it here). At that time, the index was facing technical resistances at the descending channel’s resistance line and at the 4,000.00 price level. So for the index to resume its upward move which was non-existent for like 5 months already, it needed to free itself from the the channel and move past 4,000.00.
In one sweet move earlier today, it did just that when it broke out from the descending channel and pushed itself to close at 4,023.74. Given today’s long green bullish candle indicates some optimism in the market. With the MACD just turning positive and moving above the zero-line, things could indeed look pretty for the PSEi. So if the buying interest in the market could be sustained, the index could aim for 4,200.00. Once it clears that level, 4,400.00 could be its next target.
Note: The broad-based buying in the heavyweights Philippine Long Distance Telephone Company (PLDT) or TEL, JG Summit Holdings (JGS), and Globe Telecom, Inc. (GLO) helped pushed the entire market higher.