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Jakarta, CNBC Indonesia – The Composite Stock Price Index (IHSG) spiked 3.5% to 6,067,545 in trading on Monday (1/2/2021), at the same time halting the slide on 7 consecutive days.
Although it managed to strengthen considerably, trade data shows that foreign investors made net sales of nearly Rs 500 billion, with a transaction value of more than Rs 23 trillion.
National economic data provided fresh air for JCI.
IHS Markit reports that manufacturing activity is reflected in Purchasing Managers Index (PMI) Indonesia for the period of January 2021 amounting to 52.2. An increase compared to the previous month that amounted to 51.3.
PMI uses the number 50 as a starting point. If it is above 50, it means that the business world is entering a period of expansion.
“The Indonesian manufacturing sector is still on a recovery path in early 2021. Industrial production and new orders have risen to their highest level. This trend will boost business confidence,” said Andrew Harker, Chief Economic Officer, IHS Markit , as quoted in a statement. .written.
The good thing about this expansion is that it occurred during the enactment of Community Activity Restrictions (PPKM).
PPKM in Java and Bali will be held from January 11 to February 8. This is feared to slow down Indonesia’s economic recovery, as the activities of many people are limited.
But in fact, Indonesia’s manufacturing sector is expanding.
Meanwhile, in today’s trading, Tuesday (2/2/2021), JCI has the potential to rise again, seeing the global stock market green last Monday. Wall Street, which is the mecca of world stock markets, soared, the Dow Jones index + 0.76%, the S&P 500 + 1.61% and the leading Nasdaq + 2.55%.
Technically, yesterday’s strong strengthening brought JCI back above 6,000 and the 50-day moving average (moving average / MA50). The increase came after registering a decrease on 7 consecutive days.
JCI’s continued decline occurred after forming a pattern of 3 black crows (three black raven). This pattern is a sign of a reversal, from earlier on an upward to downward trend, or “catastrophe” for JCI.
Pola three black raven consists of 3 candle stick decreasing, with the last candle close position always lower than candle previous.
JCI, which is now above MA 50, provides an opportunity for JCI to continue to grow stronger, as well as to stop the “shadow” of the three black crows.
 Chart: Daily IHSGPhoto: Refinitiv |
But if it returns below 6,000, then there is a risk of a further downside resurgence, targeting around 5,600 in the next few days.
The 5,600 level is close to the 100 MA and the 61.8% Fib retracement, which could be strong support. Fiber went from a September 2019 high of 6,414 to a 2020 low of 3,911 on the daily chart.
Meanwhile, the stochastic indicator on the daily chart is still in the oversold area (oversold).
Stochastic is leading indicator, or indicators that initiate price movements. When the stochastic hits the territory overbought (above 80) or oversold (below 20), then the price of an instrument has a chance to reverse.
On the contrary, the hourly stochastic begins to enter the overbought zone.
 Chart: IHSG 1 hourPhoto: Refinitiv |
As mentioned above, by being above 6,000 and MA 50, JCI has a chance to get stronger again, as long as it stays above. Immediate resistance is around 6,160, which is the strengthening target. If penetrated, JCI has the potential to shoot 6,200.
Meanwhile, if it falls below 6,000 again, the IHSG risks falling further to 5,950 to 5,920.
CNBC INDONESIA RESEARCH TEAM
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