If you are using technical analysis methodology to analyze KLCI data you should be aware of this. Your KLCI data up to 3rd July 09 refer to a basket of 100 counters but on 6th July 09 and onward, KLCI data refer to a basket of 30 counters. That 70 counters difference, you can say the data you are analyzing are actually two different entities.
Technical analyst analyze participant's buying and selling activities. And previous KLCI data refer to participant's buying and selling activities of 100 counters but FBM KLCI data refer to participant's buying and selling activities of just 30 counters. It is difference.
Your long term support or resistance analysis could be skewed. Your long term trend channels could be skewed. Your Eliot wave counting could be skewed. Your likely pivot points could be skewed. Your cluster zone could be skewed. Your high probability reversal point could be skewed. Allow skew ness factor.
And another skewness factor:
With FBM KLCI; component counters yesterday's close price calculated as today's opening price (for index calculation). It shouldn't be. Today's opening price should be determined by today's opening price NOT by yesterday's closing price. How can it be? This will skew your candlesticks readings. Anyway, I think it's quite minor and heard FTSE is looking into it (thanks to Maybank Investment Bank for the alert).
With FBM KLCI; component counters yesterday's close price calculated as today's opening price (for index calculation). It shouldn't be. Today's opening price should be determined by today's opening price NOT by yesterday's closing price. How can it be? This will skew your candlesticks readings. Anyway, I think it's quite minor and heard FTSE is looking into it (thanks to Maybank Investment Bank for the alert).
