A dark cloud looms after a day a bearish of trading. This dark engulfed Friday's sunny spot too.
This doesn't look good. The technical signs are clear. The bears are grabbing the bulls by their horns and flipping them around. It makes you wonder why you ever loved bears when you were a kid. These big and cuddly creatures can be quite fierce.
This marks the start of the formation of a third peak on the downswing for the STI ever since the first bearish peak formed in December 2007. Considering that fundamentally, the markets in the region and the US are weak, the general trend shall remain negative for now. Further considering the market cycle from a wave principle perspective, the market is likely to dip under 2800 points to its all year low and range for a while after that.
No worries for bargain hunters out there. Bargain hunting season shall come in due time (next 2 months are so). It really depends on how you look at it. One can start a shopping spree when the market hits a low and starts to range for a while, or join the crowd on the onset of a breakout (which is likely to be a good one this time). From a "risk and return" point of view, there is no advantage in going in to early and waiting the range-market out. You'll have to endure the pain of inter-mitten paper loses for the dividends.
For now, the outlook for tomorrow is that the market is likely to open a little higher. This phenomenon has happened 4 times in the last 6 months. Twice it closed higher, twice it closed lower. This time however, my take would be that it will close lower. The basis of this is that, in a bearish market, there has already been 5 nice white candles and a doji in the last 6 trading days before this.
This ends today's insight. Watch out for a face lift to this website very soon.
Monday 31 March 2008
Friday 28 March 2008
Bearish Reversal?
The market closed 6.70 points in the green. A plunge from its midday rally of 30.53 points higher after its 17.00 points lower opening. Today's candle is a white candle with the top wick as long as its white portion. This is the reverse of Thursday's white candle which was one with a bottom wick but no top wick.
Considering current market sentiments, this could be the start of a reversal. Parties who have bought at the previous low will take the opportunity to sell. This shall further be fueled by the those who are inclined to take short positions.
I would expect the STI to reverse downwards next week. Even though some stocks remain value buys, the pessimistic market sentiments can be expected to overwhelm the purchasing. Risk-takers can start to take short positions while value investors should continue waiting for a better buy. Adventurous parties can seek for stocks with a negative beta to ride a possible upswing but these cases are rare in our marketplace.
Considering current market sentiments, this could be the start of a reversal. Parties who have bought at the previous low will take the opportunity to sell. This shall further be fueled by the those who are inclined to take short positions.
I would expect the STI to reverse downwards next week. Even though some stocks remain value buys, the pessimistic market sentiments can be expected to overwhelm the purchasing. Risk-takers can start to take short positions while value investors should continue waiting for a better buy. Adventurous parties can seek for stocks with a negative beta to ride a possible upswing but these cases are rare in our marketplace.
1.00% Higher!
The STI closed 1.00% higher on Thursday, climbing continuously since 1530hrs. From my previous post, I did not expect this to happen. The index has broken my (and also other analysts) previous estimates that the highest rally will peak at about 3000 points. That assumed peak happened on Tuesday.
One of the reasons for today's rally could be due to the buying for trades that were short. The market opened lower today. Fuelled with the need to settle the short position (which started on Tuesday), traders were inclined to buy when the opportunity presented itself.
Looking at the Dow today as I am writing this (just like Tuesday), I would consider tomorrow to be a good day with the Singapore market opening a little above today's closing. There could be a chance of the STI hitting a high of 3100 in the new few trading days. If anyone has bought anything in the last downturn or wishes to short the market. SELL signals should come in due time.
One of the reasons for today's rally could be due to the buying for trades that were short. The market opened lower today. Fuelled with the need to settle the short position (which started on Tuesday), traders were inclined to buy when the opportunity presented itself.
Looking at the Dow today as I am writing this (just like Tuesday), I would consider tomorrow to be a good day with the Singapore market opening a little above today's closing. There could be a chance of the STI hitting a high of 3100 in the new few trading days. If anyone has bought anything in the last downturn or wishes to short the market. SELL signals should come in due time.
Wednesday 26 March 2008
Prophesy fulfilled?
The STI closed just 4.97 points today after opening lower by 13 points. This fulfills my expectations of it, for now. It has been a rather boring day considering the narrow variance and intra-day fluctuation.
The market dipped and rallied higher after trading hours fueling my expectation of it opening at about the same point as it closed tomorrow morning. I expect that tomorrow will be another small black candle. I hold my stance on the current situation as I did yesterday.
In order to make this website more interesting and informative, I shall soon extend my market watch to cover industries and even specific counters. Capabilities will be added gradually as I have more time and resources.
The market dipped and rallied higher after trading hours fueling my expectation of it opening at about the same point as it closed tomorrow morning. I expect that tomorrow will be another small black candle. I hold my stance on the current situation as I did yesterday.
In order to make this website more interesting and informative, I shall soon extend my market watch to cover industries and even specific counters. Capabilities will be added gradually as I have more time and resources.
Another bright day?
The STI opened about 33 points higher on Tuesday and closed at what may seem to be a breakout at 3000.19. The last known candle stick from good sources indicate a white stub with a longer top wick than bottom wick. Considering the last few candles, the market was starting to down turn at the end of the day. This is true from sources with after-trading data. The aggregate candle for the day is a white candle with a stubby bottom wick and a top wick of about 23 points. Could this be the last bright day for now?
I have the privilege of looking at the DOW while writing this. I am a little late today due to personal commitments. The DOW opened lower today. Currently, the day looks like it is going to end in a hammer. This suggests that there may be further upside in the US markets, which is good news for us in Singapore when the market sentiments seem to follow the US rather closely especially now. However, the "hammer" today is a black one with a considerable top wick. Caution has to be taken when assuming that this is a positive signal.
My take is that STI may open lower at 9am later (Singapore Time) and close not far below 3000 points. The basis for this lies in the closing trend and the fact that the hammer on the DOW is black and not a clear one. The chances of breaking the 3000 point barrier, substantially upwards, is low for now. I hold my view that the coming 3 months is in general "bear". BUY signals or market bottoms can be expected become clearer in the later half of April.
I have the privilege of looking at the DOW while writing this. I am a little late today due to personal commitments. The DOW opened lower today. Currently, the day looks like it is going to end in a hammer. This suggests that there may be further upside in the US markets, which is good news for us in Singapore when the market sentiments seem to follow the US rather closely especially now. However, the "hammer" today is a black one with a considerable top wick. Caution has to be taken when assuming that this is a positive signal.
My take is that STI may open lower at 9am later (Singapore Time) and close not far below 3000 points. The basis for this lies in the closing trend and the fact that the hammer on the DOW is black and not a clear one. The chances of breaking the 3000 point barrier, substantially upwards, is low for now. I hold my view that the coming 3 months is in general "bear". BUY signals or market bottoms can be expected become clearer in the later half of April.
Monday 24 March 2008
Strong gains - a Sign of Relief?
The STI gained a good 102.88 points today after gapping up by 52 points at the start of the day and having an additional boost after 5pm. Could this be a sign of relief for the Singapore market in what is perceived as gloomy days ahead?
STI chart for the last 2 years looks like a classic Elliot wave - 3 distinct upswings between June 2006 and November 2007 and down swings after. Considering the "bear" sentiment from end of 2007, the wave can be expected to reverse direction in a series of downswings, which is what is happening now. From November 2007 to February 2008, the STI charts show 2 distinct "humps" on the downswings and a little "bump" between February and now. These can be considered corrections to the "bear market". The "humps" are clear corrects but what the "bump" suggests has yet to be confirmed. While generally pessimistic news looms around the stock markets for the moment, it is unlikely that todays gains signify a turning point. On the other hand, todays gains may in the longer term future become a part of the third "hump", which signifies a ride to the bottom.
At this point, I would like to point out that this website seeks to provide day-to-day analysis of the Singapore market and insights for the common people, you and me who have no foothold on the inside but make do with as much information and knowledge we can obtain. Every evening, I shall share my analysis of the day and anticipations for the next day.
Now for the anticipations for the next day...
Intra-day candle sticks today show that the market is relatively upbeat for the moment considering the large white candles that scatter throughout the day. The last candle stick was a white stub. In total, today's movement has resulted in a large white candle with no wick on either side. Looking at the candlesticks for the last 3 months, what we can expect tomorrow to be a little stub for the day and a series of dark days to come. Further, considering the candles of past 3 months, the top of the short upswing should be between 2900 to 3000 points. Today's 2927.79 is already within range.
Verdict:
BUY or SELL, you decide (it really depends on what you BUY or SELL). For value investors, you may wish to wait a bit longer before you decide to pick up something.
STI chart for the last 2 years looks like a classic Elliot wave - 3 distinct upswings between June 2006 and November 2007 and down swings after. Considering the "bear" sentiment from end of 2007, the wave can be expected to reverse direction in a series of downswings, which is what is happening now. From November 2007 to February 2008, the STI charts show 2 distinct "humps" on the downswings and a little "bump" between February and now. These can be considered corrections to the "bear market". The "humps" are clear corrects but what the "bump" suggests has yet to be confirmed. While generally pessimistic news looms around the stock markets for the moment, it is unlikely that todays gains signify a turning point. On the other hand, todays gains may in the longer term future become a part of the third "hump", which signifies a ride to the bottom.
At this point, I would like to point out that this website seeks to provide day-to-day analysis of the Singapore market and insights for the common people, you and me who have no foothold on the inside but make do with as much information and knowledge we can obtain. Every evening, I shall share my analysis of the day and anticipations for the next day.
Now for the anticipations for the next day...
Intra-day candle sticks today show that the market is relatively upbeat for the moment considering the large white candles that scatter throughout the day. The last candle stick was a white stub. In total, today's movement has resulted in a large white candle with no wick on either side. Looking at the candlesticks for the last 3 months, what we can expect tomorrow to be a little stub for the day and a series of dark days to come. Further, considering the candles of past 3 months, the top of the short upswing should be between 2900 to 3000 points. Today's 2927.79 is already within range.
Verdict:
BUY or SELL, you decide (it really depends on what you BUY or SELL). For value investors, you may wish to wait a bit longer before you decide to pick up something.
Saturday 22 March 2008
1st post
Decided to create this website today.
The purpose of this website is to consolidate daily "kopitiam" and "pasat" talk among my friends and myself on the stock market and share it with fellow investors and speculators alike. These entries are intended to be free with the motive of sharing ideas and knowledge about the markets. This website is dedicated to friends who have limited information and resources when investing.
Here at "Lau Pa Sat" I intent to create a platform where readers can share their opinions after reading my daily entries. I have dedicated myself to watching the markets everyday. Opinions are my own.
I shall gradually upgrade the features of this website to provide a one-stop-shop for like-minded investors and interested parties.
*Disclaimer: The opinions on this website are the author's own and DO NOT constitute as investment advice. Caveat emptor. Actions based on opinions given in this website will not necessarily result in gains. Please practice due diligence before making any investment action. The author takes no responsibility of the outcome of the reader's decisions.
The purpose of this website is to consolidate daily "kopitiam" and "pasat" talk among my friends and myself on the stock market and share it with fellow investors and speculators alike. These entries are intended to be free with the motive of sharing ideas and knowledge about the markets. This website is dedicated to friends who have limited information and resources when investing.
Here at "Lau Pa Sat" I intent to create a platform where readers can share their opinions after reading my daily entries. I have dedicated myself to watching the markets everyday. Opinions are my own.
I shall gradually upgrade the features of this website to provide a one-stop-shop for like-minded investors and interested parties.
*Disclaimer: The opinions on this website are the author's own and DO NOT constitute as investment advice. Caveat emptor. Actions based on opinions given in this website will not necessarily result in gains. Please practice due diligence before making any investment action. The author takes no responsibility of the outcome of the reader's decisions.
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