Alert! JCI could slide to below 6,000, beware Boncos

Jakarta, CNBC Indonesia – The Composite Stock Price Index (IHSG) collapsed, unmitigated to 1.4% last Wednesday. Foreign investors who were previously diligent in buying up stocks even though the JCI was weakening, yesterday turned around to sell a net worth of Rp 644 billion. The bad news is that the downward pressure on the JCI will still be strong in today’s trading, Thursday (9/9/2021).

Pressure comes from within and outside the country. Yesterday, data showed that the Indonesian people were increasingly insecure in looking at the economy. This is reflected in the Consumer Survey conducted by Bank Indonesia. In the period of August 2021, the Consumer Confidence Index (IKK) was at 77.3. A decrease compared to the previous month which was 80.2.

The IKK uses the number 100 as the threshold. If it is below 100, it means that consumers are pessimistic about the current economic outlook for the next six months.

Then from abroad, the stock market of the United States (US) fell again. Concerns arise about the September Effect, where the stock market will correct after strengthening in the last 8 months.

In addition, the issue of tapering is now increasingly widespread, not only the US central bank (The Fed), several major central banks in the world have also begun to signal this. The Australian central bank (Reserve bank of Australia / RBA) has done it this month, the South Korean central bank has even raised interest rates. So that the atmosphere of monetary tightening has begun to be felt, at a time when people are not sure about looking at the economy in the future.

When society doesn’t ask, then the level of consumption tends to decline, which of course risks suppressing economic growth.

Technically, the wind direction has reversed for the JCI. Previously, the opportunity for strengthening opened after the JCI was above the 50-day moving average (moving average 50/MA 50), MA 100, and MA 200. The collapse of the JCI yesterday made its position almost below the three MAs.

Graph: Daily JCI
Foto: Refinitiv

Previously, the JCI was also supported by the White Marubozu pattern, but now it doesn’t help anymore. A candle stick is said to form a White Marubozu pattern when the price open equal to low and close equal to high.

White Marubozu is a signal that the value of an asset will strengthen again, psychologically indicating that buying is dominating the market. This pattern appeared on August 23 last, and reappeared on August 30. JCI is now below the last White Marubozu pattern, so it is no longer a support for the increase.

JCI is now right at the 100 MA in the range of 6,020, even yesterday it was crossed. This means, if today’s trading is broken again, the pride of the country’s stock exchange risks testing the psychological level of 6,000. A break below this level risks causing the JCI to slide towards 5,970 to 5,950.

Meanwhile, if it is able to stay above the 100 MA, JCI has the opportunity to strengthen to 6,060 to 6,080.

CNBC INDONESIA RESEARCH TEAM

[Gambas:Video CNBC]

(pap / pap)



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