Chart of the day: Bullish outlook for Indonesian stocks
On Friday, government data showed that Indonesia posted another, albeit small, trade surplus of US$130 million, while the Jakarta Composite Index rallied to close at a record high. Helped by subdued core inflation at 3 per cent, which in turn allowed the seven-day reverse repurchase agreement to be set at a record-low 4.25 per cent, the outlook for next year looks very positive. Technically, the index is not as overbought as it got to be at certain points last year, and momentum remains towards the lower end of its historical scale. Volume has been steady since March, at slightly higher levels than the long-term mean, suggesting strong participation. Hopefully, we are in for more of the same.
Nicole Elliott is a technical analyst