PSI20 Weekly/Daily

Hello fellows!

As you may know I'm from Portugal and our stock market index is called PSI20. I never traded any stock from this index and I don't know any ETF that tracks in any way our so beloved PSI20...it's pitty...

Let me show you the weekly chart (to the monthy one there's nothing to say...yet)

In the top of the chart you can see the performance of my trend follower (MTF). Notice how it handled
the 2008's bear market! Ohhhh if only I had this follower already developed by then....it would have saved me from some nightmares :)

I'm showing you this right now because last week the MTF provided a new buy signal. However, from a
technical standpoint I don't think things are already settled. An this is mainly because the MACD divergence
is still negative (but growing) and the stochastic oscillator ended this week in a sell. A conservative investor
should hold some more time to buy. Maybe buy if the daily chart is under a buy signal:

As you can see, the daily chart is still under a sell signal and there's some evidence that this one may
be here for some days. The MACD is curling under it's signal and the stochastics is on a sell. In October/09
happenned something similar as one can check.

So, what does this tell us? This tells us not to trust the last buy signal in the weekly chart. At least not right now! The MTF in the weekly chart has been providing an impressive performance, but the timming to buy
a weekly signal must be always checked against the respective daily chart. This is very important in order
to get the most out of a long trade.

Just for the fun, take a look at the performance of the MTF in the weekly chart:

This is a 122% return since March/1998 (more or less 10% profit per year) and being only 53% of time in the market.
If you pay attention this is a very good profit rate, because since 1998 two bear markets were in place and we still didn't see new highs since the 2000's top.

Trade safely,
Regards.