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Recently, some foreign stock markets have shown signs of weakness or even have broken their long term support level. For KLSE, it has once broken its bull support level of 1233 point to 1224. Now market is undergoing soft rebound. Is this the sign that KLSE will slowly move back to its recent low before it collapse and turns into bear market?

The way I look at it, KLSE seems to be indecisive.

The KLSE market had peaked and gone through collapsing cycle following the bull in the following years:

1974. 1977, 1981,
1984, 1987, 1990,
1993, 1997, 2000,
2003, 2007, ???

These are rough figures, some may differ a bit like bull market for 1993, it collapsed immediately at February 1994 after the fantastic bull run.

It seems that for this cycle, the bull will most probably peak at year 2010, follow by its collapse also.

Nice numbers there. :)
Anyway, in my opinion, there is not much upside to the market at this moment. More downside risks actually.
Depending how the movement until Jun 2010, July may present a good opportunity to buy.

NOTE - the keywords here are - depending and may.
Hopefully no one will misquote me :P

The way I look at how KLSE will trend:

"bull" could be peaked at January 2010 or not yet over, will peak at April,2010.

But most probably, index will fluctuate in between 1224 to 1288 points within these few months, dip & dip until it reaches previous low at 1224. Then within a very short period (possibly 2H2010), market will collapse and begins its bear cycle.

Note: this view is purely for market learning, not to be taken as buy/sell guide/suggestion.

Wow... pretty pessimistic.
May I ask what is the basis, purely out of curiosity.
From chart point of view, even if it hits 1170 level, the bull is still there - time­frame­ for this year.

Firstly, from the composite index daily chart, if the index drops again to below 1224 point, it looks like the chart will follow the trend of inverted head & shoulder.

2) From the composite index monthly chart, the slow stochastic is now at around 90 87. This is very much overbought. The curve is turning down at present showing a weakness of possible trend reversal. MACD is also turning down. Though this could be a technical correction and it is possible that they will turn upward again to head its final peak, I prefer to believe they won't as most of the time they won't.

3) Considering the life span for each KLSE bull cycle and the many financial problems yet to be surfaced in various parts of the world, I reached the conclusion that KLSE will peak and collapse within this year.

Anyway, I would like to hear views and opinions from more investors. I would be greatly appreciated if Leremy (Admin) and Max could further elaborate their views in details. Thanks.

Thanks for sharing your views.
Instead of looking at an inverted h&s, I m looking at cup and handle in formation.
As for indicators, I dont use them.

In simple word, now the market is still a bull market, but it is in 'distribution period'. Once the distribution period ends, the bear will start to crawl in.

It takes a long time to kill a bull. I don't think this bull market is over yet.

China is overheating now and its government is trying to cool it by raising banks statutory reserve by another 50 basis points come 25.02.09. China is too big to ignore and what happens there affects the world.

Some European countries, notably, Portugal, Ireland, Greece and Spain (PIGS) are having debt problems. America owes China a lot of money. The Chinese save so that Americans can spend. The Americans like to drink champagne on a beer budget. They have overspent.

If the China stops lending to America, Chinese goods cannot sell and it will be in trouble. China does not want this to happen and it does not want the USS to go down as well. Although there is plenty of talk that the US$ will devalue, I have not seen this happen yet.

Lately China has been selling US treasury bills and Japan has taken over the number 1 spot. What do all these means? China's relationship with US is drifting. It is not happy that America has sold war equipments totaling more than US$6.3 billions to Taiwan. It is not happy with Obama's visit to Dalai Lama.

With so much world problems at hand, it is only logical to expect the market to cool down. How much will it drop? Is the present softening at Bursa a reversal or a correction? Only time will tell. My advice is this:
If it be down, let it be down; do not buy until you see a buy signal. If you do not know what is a buy signal, then you will have to study Japanese candlesticks to be more knowledgeable.