ILOILO City – The Philippine stock index closed the week at 7,700 points, indicating a possible rebound to the 8,000 “psychological” level, a technical analyst reported.
Should such rebound take place, it could signal a possible end or even reversal to the downturn that had been going on for the past few week, according to Hernan Segovia.
“This week we saw the market ending at the 7700-plus level,” Segovia said. “For now the market support is pegged at the 7500 to 7600 level, and with that the market is ripe to do a technical rebound to 8,000 level, I think. That is the level to break – the psychological level for now.”
The all-time high for the index was in the 9,100 level, but after the index tumbled below the 8,000 level, traders and investors have been waiting for the market to reach a support level and, consequently, a rebound.
According to Segovia, the best buying choices in the current market remain blue chip stocks, like Ayala and SM group.
“Retail buyers are positioning not only on momentum-driven stocks but also blue chips, but we haven’t seen them for foreign inflows,” he said.
“The market is in no position to go long-term. We just trade the market because, going forward to the end of the year, it will just go range trading,” he added.
Asked if fresh foreign inflows could help lead to a potential reversal and toward an uptrend, Segovia was uncertain – but he did not discount the possibility either.
“Once we’ve established that the market has indeed recovered from its dive, then we can take another position to establish a long-term point of view,” he said./PN
