![\"Philippine](\"http:\/\/www.laidtrades.com\/wp-content\/uploads\/2011\/02\/Philippine-Stock-Exchange-Index-February-13-2011-300x180.jpg\" "\\"Philippine")
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Let’s take a look at the chart of the Philippine Stock Exchange Composite Index<\/a> (PSEi) once again. Based on my technical analysis the last time (kindly check this<\/a>), I mentioned that there was a falling wedge pattern<\/a> forming within the 2-year ascending channel<\/a>. In case you do not know, falling wedges are naturally bullish since it represents a temporary price retracement of a financial instrument or in layman’s terms, this occurs because of profit taking. It usually forms inside an ascending channel like what we had here. However, unlike most falling wedges, this one failed to perform its purpose. Instead of breaking out, the PSEi fell from the supposedly bullish pattern along with the 2-year ascending channel breakdown.<\/p>\n The Philippine Stock Exchange Index closed slightly below its 200-day moving average last Thursday after dropping by a whooping 2.7%. This could be a breakdown to many, however, it isn’t convincing for me. True enough, the index rose by 0.3% the next day despite the decline of many index stocks. The 11.11% gain of AEV<\/a> (Aboitiz Equity Ventures, Inc.) was a big factor in pulling up the PSEi since this publicly listed company has a 6.52% weight in the index (kindly check my colleague’s AEV analysis<\/a>).<\/p>\n The Philippine Stock Exchange Index is currently clinging to the 200-day moving average and personally, I’m expecting a bounce back up from this area. If I’m right and the bulls take over, the immediate hurdle will be the “mini descending channel”. A move pass above that, could make way for the next resistance at 4,000.00. Otherwise, the index could continue to descend and the next support waiting is around the 3,550.00-3,600.00 area (labeled as “next significant support” in the image above).<\/p>\n