Announcements
Sorry for not posting in the past 2 weeks. The market has been uninteresting.
Insights and Opinion
In my last post, I mentioned a reversal in both the STI and HSI. It happened but it only lasted for 2 days. The markets have since been down.
STI
The STI has fell in line with the rest of the markets in the first week of August. Fed and Euro rates being held, helped the market to sustain its low levels and not go lower. The past 2 trading sessions have seen strong gains in the DOW but none here. The Prime Minister warns of trying times and a lower GDP estimate. GDP grown rates in Singapore have slightly contracted in Q2 and have aggravated the bleak situation. This has been a case of fundamentals overwhelming technicals. Technically, the short term outlook is good with an expected climb to a the band of 3000 +/- 50. If the DOW and Nikkei post strong gains in the next few trading sessions, it may overwhelm the negative sentiments here and bring the market up a little before more worries set in. That can be an opportunity to exist open positions.
HSI
The recent storm has caused the Hang Seng to close for a day and has not helped the situation as the HSI seems to be tracking the STI in the last 2 trading sessions. I would expect the HSI be a a reactive market in the next few trading sessions.
Nikkei and DOW
The Nikkei has been tracking Wall Street. This makes it relatively easier to chart than the STI and HSI. However, the strong gains of both markets in the last few trading sessions shall reverse on profit-taking as the markets climb towards their short term resistance range.
More substantial views with new charts shall be posted in the coming days. Watch this space ;)
Showing posts with label singapore stock market. Show all posts
Showing posts with label singapore stock market. Show all posts
Tuesday, 12 August 2008
Wednesday, 30 July 2008
Interim update of the week
Good day, good people!
A little intro, this post to kick start the action and bring a little life at this clean and green site.
Now let's have our market action updates.
Market Action
After 3 trading days as I last wrote about the retracement matter, we see that markets have plunged tremendously, exceeding our expectations of lows. This is partially because the turning points were a little lower than expected. Nonetheless, the expected has happened. We shall now brace for what is to come.
As this is being reported, the STI is at a low of 2886.56, the HSI at 22285.00 and Nikkei at 13159.45 All 3 major Asian indices have fallen considerably since Thursday. On the other hand, Wall street is rebounding from its low.
Insights and Opinion
Moving forward, we have our visual illustrations and opinions on where things are heading.
Starting with the STI, here we see a familiar candlestick. Not that this candlestick is a very special one and that its presence signifies a reversal about to happen, this candlestick after a gap down shows that a reversal is likely to happen. Throughout Tuesday, the market opened much lower and crept up slowly and quite surely, implying short term strength. This
together with our familiar candle is good sign.
On to the HSI. The latest candle is obviously a hammer. Although it is a black one, its presence in a strong bear market is a reversal sign.
Wrapping up, these signs are in line with previous estimates of retracement of the markets and projected short term up trend.
Say tuned for the next update coming soon, within the week, when we confirm this short term up trend and analyse the coming downturn.
A little intro, this post to kick start the action and bring a little life at this clean and green site.
Now let's have our market action updates.
Market Action
After 3 trading days as I last wrote about the retracement matter, we see that markets have plunged tremendously, exceeding our expectations of lows. This is partially because the turning points were a little lower than expected. Nonetheless, the expected has happened. We shall now brace for what is to come.
As this is being reported, the STI is at a low of 2886.56, the HSI at 22285.00 and Nikkei at 13159.45 All 3 major Asian indices have fallen considerably since Thursday. On the other hand, Wall street is rebounding from its low.
Insights and Opinion
Moving forward, we have our visual illustrations and opinions on where things are heading.
Starting with the STI, here we see a familiar candlestick. Not that this candlestick is a very special one and that its presence signifies a reversal about to happen, this candlestick after a gap down shows that a reversal is likely to happen. Throughout Tuesday, the market opened much lower and crept up slowly and quite surely, implying short term strength. This
together with our familiar candle is good sign.
On to the HSI. The latest candle is obviously a hammer. Although it is a black one, its presence in a strong bear market is a reversal sign.
Wrapping up, these signs are in line with previous estimates of retracement of the markets and projected short term up trend.
Say tuned for the next update coming soon, within the week, when we confirm this short term up trend and analyse the coming downturn.
Thursday, 24 July 2008
Turning Point?
Market Action
Both the STI and HSI shed a bit of yesterday's gains (0.04% and 0.20% respectively) despite Wall Streets gains. The Nikkei is up 2.18% to 13603.31. The Singapore market was supported by gains in the banks, SGX as well as Citydev while other counters closed under the water.
Insights and Opinion
Following yesterday's Ichimoku charts, we have 2 charts on near term support and resistance.
This first chart shows the STI candlesticks. The top and bottom horizontal dotted lines are the near term support and resistance lines while the middle dotted line cuts the level at which a slight reversal is possible. The proportion here exhibits what can be believed to be, sacred geometry. In this case, it is just 1:2, where 1 and 2 are Fibonacci numbers. As the market is currently exhibiting a range phenonmenon, I have assumed the possible length of time this cycle will last.
This second chart shows the HSI candlesticks. The lines drawn here have the same meaning. Notice that the patterns for the HSI are similar to that of the STI. Considering the current macroeconomic climate, it is safe to assume that coupling of the markets shall persist for now.
The circled parts in both graphs give me a basis to believe that a short turning point will occur.
Once again, click on the charts to have them enlarged.
Both the STI and HSI shed a bit of yesterday's gains (0.04% and 0.20% respectively) despite Wall Streets gains. The Nikkei is up 2.18% to 13603.31. The Singapore market was supported by gains in the banks, SGX as well as Citydev while other counters closed under the water.
Insights and Opinion
Following yesterday's Ichimoku charts, we have 2 charts on near term support and resistance.
This first chart shows the STI candlesticks. The top and bottom horizontal dotted lines are the near term support and resistance lines while the middle dotted line cuts the level at which a slight reversal is possible. The proportion here exhibits what can be believed to be, sacred geometry. In this case, it is just 1:2, where 1 and 2 are Fibonacci numbers. As the market is currently exhibiting a range phenonmenon, I have assumed the possible length of time this cycle will last.
This second chart shows the HSI candlesticks. The lines drawn here have the same meaning. Notice that the patterns for the HSI are similar to that of the STI. Considering the current macroeconomic climate, it is safe to assume that coupling of the markets shall persist for now.
The circled parts in both graphs give me a basis to believe that a short turning point will occur.
Once again, click on the charts to have them enlarged.
Wednesday, 23 July 2008
一目均衡表
Announcements
The inconsistent posting is regretted. Be sure to check this space every week. I will update it once a week from now on. No point updating everyday as I am not a reporter.
Market Action
Notice I dropped the "Today". I suppose it is more useful to share a boarder view.
The market seems bullish in the short term. However, near term correction is highly possible. Regional markets like the Nikkei and Hang Seng have had strong gains since last week. As of today, the STI gained 88.32 points to finish at 2978.32. In the region, the HSI gained a whooping 607.07 points to reach 23134.55 and the Nikkei also climbed 127.97 points to 13312.93.
Insights and Opinion
I have had comments that my insights needed to be a bit more "insightful". As I endeavour to upgrade the content on this site, here is the first invention to roll out. Introducing, Mao's Ichimoku.
The 一目均衡表 (Ichimoku Kinko Hyo) was invented in 1935 by a Japanese writer named 細田悟一氏. It is technical indicator used in technical analysis. Its full definition can be found at Investopedia.
For the purpose of my research, I have customised the Ichimoku for my analysis. I have attached 2 diagrams below to illustrate my findings using Mao's Ichimoku. The customised Ichimoku here has had its variables changed even though the lines are used for the same purpose. Mao's Ichimoku is used best to gauge quarterly (3-month) outlook. Click on the pictures to enlarge them.
Here we have the STI Candlestick chart with Mao's Ichimoku overlay. The Blue line is the Tenkan Sen, Red line is the Kijun Sen. These work like moving averages over a period of 8 and 21 days respectively. The Baby Blue line and Pink line are the Senkou Span A and Span B respectively. The area between the lines are the Ichimoku cloud which is a gauge for support and resistance.
From this chart, the STI is likely to retrace when it reaches 3030 to about 2940 levels. The retracement process will take 2 to 3 trading days. After this, it is likely to go all the way to a resistance at 3150. 3150 is the part just above the cloud. Due to the current state of the economic fundamentals, it is not likely to see the market break very much above the cloud. Technically speaking from the trend in the chart, it is unlikely that it will not reach for the resistance level in the short term.
Now for the HSI. The HSI is likely to retrace when it reaches 23300 to about 22400 levels. The retracement process is likely to happen within the next 2 trading days and will take 2 to 3 trading days to complete. After this, it is likely to go all the way to a resistance at 24500. Again, 24500 is the part just above the cloud. Economic fundamentals and technical indicators that apply to the STI are applicable here as well.
Hope you enjoyed this post and found the information useful. Feel free to comment :)
The inconsistent posting is regretted. Be sure to check this space every week. I will update it once a week from now on. No point updating everyday as I am not a reporter.
Market Action
Notice I dropped the "Today". I suppose it is more useful to share a boarder view.
The market seems bullish in the short term. However, near term correction is highly possible. Regional markets like the Nikkei and Hang Seng have had strong gains since last week. As of today, the STI gained 88.32 points to finish at 2978.32. In the region, the HSI gained a whooping 607.07 points to reach 23134.55 and the Nikkei also climbed 127.97 points to 13312.93.
Insights and Opinion
I have had comments that my insights needed to be a bit more "insightful". As I endeavour to upgrade the content on this site, here is the first invention to roll out. Introducing, Mao's Ichimoku.
The 一目均衡表 (Ichimoku Kinko Hyo) was invented in 1935 by a Japanese writer named 細田悟一氏. It is technical indicator used in technical analysis. Its full definition can be found at Investopedia.
For the purpose of my research, I have customised the Ichimoku for my analysis. I have attached 2 diagrams below to illustrate my findings using Mao's Ichimoku. The customised Ichimoku here has had its variables changed even though the lines are used for the same purpose. Mao's Ichimoku is used best to gauge quarterly (3-month) outlook. Click on the pictures to enlarge them.
Here we have the STI Candlestick chart with Mao's Ichimoku overlay. The Blue line is the Tenkan Sen, Red line is the Kijun Sen. These work like moving averages over a period of 8 and 21 days respectively. The Baby Blue line and Pink line are the Senkou Span A and Span B respectively. The area between the lines are the Ichimoku cloud which is a gauge for support and resistance.
From this chart, the STI is likely to retrace when it reaches 3030 to about 2940 levels. The retracement process will take 2 to 3 trading days. After this, it is likely to go all the way to a resistance at 3150. 3150 is the part just above the cloud. Due to the current state of the economic fundamentals, it is not likely to see the market break very much above the cloud. Technically speaking from the trend in the chart, it is unlikely that it will not reach for the resistance level in the short term.
Now for the HSI. The HSI is likely to retrace when it reaches 23300 to about 22400 levels. The retracement process is likely to happen within the next 2 trading days and will take 2 to 3 trading days to complete. After this, it is likely to go all the way to a resistance at 24500. Again, 24500 is the part just above the cloud. Economic fundamentals and technical indicators that apply to the STI are applicable here as well.
Hope you enjoyed this post and found the information useful. Feel free to comment :)
Tuesday, 15 July 2008
Posting resumes
Announcements
Apologies to those who read this page and did not find something new until now. I seem to be short of Thursday, Friday and Monday. The good news is, you have not missed much as TODAY is what matters now.
Today's Market Action
The market fell by 2.53% today, plunging 73.37 points and finishing at 2830.75. This has not happened since March. The market seems to be going down and completing its head and shoulder cycle. Sentiments are weak considering that Put warrants are in the Top Gainers and Top Losers are the index stocks.
Insights and Opinion
My near term estimate of 2900 +/- 50 has been broken. The market seems to be heading for a rebound, considering it is ranging. RSI and stocastics confirm this. However, I will not be too sure about when the rebound will start and when it will complete. In March, the market spent about 2 weeks at a low and took another 2 weeks to climb to 3150 levels. It will not be surprising if this happens again. I would expect to see "smaller scale ranging" phenomenon at current levels of 2850 +/- 50 for the next few days. But. There could be a chance of a longer recovery completing the U-shaped, temporary recovery. The resistance can be set at about 3050 +/- 50. This can be a good chance to long index stocks for a few weeks.
Further, fundamentals are weak considering the coupling of markets in the region with the US where things have not been doing very well. A rebound of equity markets would probably be fueled by a correction in commodity prices as a lot of people are expecting. Market movements are, a self-fulfilling prophesy.
Apologies to those who read this page and did not find something new until now. I seem to be short of Thursday, Friday and Monday. The good news is, you have not missed much as TODAY is what matters now.
Today's Market Action
The market fell by 2.53% today, plunging 73.37 points and finishing at 2830.75. This has not happened since March. The market seems to be going down and completing its head and shoulder cycle. Sentiments are weak considering that Put warrants are in the Top Gainers and Top Losers are the index stocks.
Insights and Opinion
My near term estimate of 2900 +/- 50 has been broken. The market seems to be heading for a rebound, considering it is ranging. RSI and stocastics confirm this. However, I will not be too sure about when the rebound will start and when it will complete. In March, the market spent about 2 weeks at a low and took another 2 weeks to climb to 3150 levels. It will not be surprising if this happens again. I would expect to see "smaller scale ranging" phenomenon at current levels of 2850 +/- 50 for the next few days. But. There could be a chance of a longer recovery completing the U-shaped, temporary recovery. The resistance can be set at about 3050 +/- 50. This can be a good chance to long index stocks for a few weeks.
Further, fundamentals are weak considering the coupling of markets in the region with the US where things have not been doing very well. A rebound of equity markets would probably be fueled by a correction in commodity prices as a lot of people are expecting. Market movements are, a self-fulfilling prophesy.
Wednesday, 9 July 2008
Short Memory, Quick Reaction
Today's Market Action
In the news today, various sources have voiced out opinions that eased yesterday's fears and the US market reversed. This has sparked our local market to gain a solid 31.00 points to 2917.62.
From the chart above, the HSI seems to be experiencing more volatility than the STI. The Nikkei which closed a little earlier did not get to experience the rebound. Markets are currently still closely coupled.
Blue-chips ruled the Top Gainers while index Call Warrants rules TOp % Gainers. On the other hand, Put Warrants dominated both the Top Losers and Top % Losers.
Insights and Opinion
Nothing much happening now is changing the short term range outlook. I read an article about the softening of the commodities market today. Hard commodity prices seem set to correct themselves especially for crude oil, which analysts think, will return to its fair value later in the year to surge again early next year. Not much to comment about commodities as I am not an expert, however, the effects of this could be beneficial to the equities market which everyone seems to be underweighting now.
The major indices around the world have been negatively correlated to the price of oil and even gold. If these hard commodities are set to soften in prices later in the year, we can well expect a late year rally in equities. Even though it is hard to say when this will happen, it may be beneficial to collect what people are dumping now, equities. However, we do have to keep in mind that not everything is very cheap even now when the market is not in a strong uptrend. In fact, most counters in the Singapore market are hanging in a "neither expensive nor cheap, no one can tell what is going to happen so don't rush in" state.
Even though the current sentiment is to hold cash, I cannot help but think that cash in my bank account is depreciating at a rate of about 6% this year. When interest rates are low, fixed income instruments are not attractive. Reasons: 1) At low yields, fixed income instruments are relatively expensive. 2) Liquidity is not optimal (At least for me. As a calculative risk taker, you can see where my interests lie).
In the news today, various sources have voiced out opinions that eased yesterday's fears and the US market reversed. This has sparked our local market to gain a solid 31.00 points to 2917.62.
From the chart above, the HSI seems to be experiencing more volatility than the STI. The Nikkei which closed a little earlier did not get to experience the rebound. Markets are currently still closely coupled.
Blue-chips ruled the Top Gainers while index Call Warrants rules TOp % Gainers. On the other hand, Put Warrants dominated both the Top Losers and Top % Losers.
Insights and Opinion
Nothing much happening now is changing the short term range outlook. I read an article about the softening of the commodities market today. Hard commodity prices seem set to correct themselves especially for crude oil, which analysts think, will return to its fair value later in the year to surge again early next year. Not much to comment about commodities as I am not an expert, however, the effects of this could be beneficial to the equities market which everyone seems to be underweighting now.
The major indices around the world have been negatively correlated to the price of oil and even gold. If these hard commodities are set to soften in prices later in the year, we can well expect a late year rally in equities. Even though it is hard to say when this will happen, it may be beneficial to collect what people are dumping now, equities. However, we do have to keep in mind that not everything is very cheap even now when the market is not in a strong uptrend. In fact, most counters in the Singapore market are hanging in a "neither expensive nor cheap, no one can tell what is going to happen so don't rush in" state.
Even though the current sentiment is to hold cash, I cannot help but think that cash in my bank account is depreciating at a rate of about 6% this year. When interest rates are low, fixed income instruments are not attractive. Reasons: 1) At low yields, fixed income instruments are relatively expensive. 2) Liquidity is not optimal (At least for me. As a calculative risk taker, you can see where my interests lie).
Tuesday, 8 July 2008
Reversal
Today's Market Action
New worries in the US on Freddie Mac and Fannie Mae have caused the US market to reverse from previous gains. The same goes here when the market action from the US is continued in this part of the world. The STI shed a solid 47.50, losing all it gained yesterday to reach a low of 2886.62. The number looks nice but it is not. Put Warrants dominated the Top Gainers and Top % Gainers. Top Losers were blue-chips and Top % losers were Call Warrants.
Insights and Opinion
Feedback from someone who read this space is that we need more than just commentary. So here is more.
As I have mentioned, yesterday's uptrend was not sustainable. Today's worries have brought the reversal back very soon. Looking at the action in the market, it can be noticed that volatility is well managed with the use of CW and PW. A point I failed to address clearly in the last post was the idea of hedging. Warrants are used to hedge the opposite movement (just in case one is wrong). Although the cost of hedging can eat away profits, this cost is well spent when we think about managing our risk. Think of it as this, "it is easier to make less profits than it is to make large profits". So when we hedge and make less profits, risk is lesser and we make profits easier. If this is scaled up, it can make more, in terms of absolute amount of profits, with lesser risk.
Keeping "hedging" in mind, the activity of PW does not necessarily translate into an expectation of a bear market, it also shows that some are hedging against potential downside by shorting the Put when going long on the underlying. This takes into consideration that some may be doing this while trying to take advantage of lower prices.
New worries in the US on Freddie Mac and Fannie Mae have caused the US market to reverse from previous gains. The same goes here when the market action from the US is continued in this part of the world. The STI shed a solid 47.50, losing all it gained yesterday to reach a low of 2886.62. The number looks nice but it is not. Put Warrants dominated the Top Gainers and Top % Gainers. Top Losers were blue-chips and Top % losers were Call Warrants.
Insights and Opinion
Feedback from someone who read this space is that we need more than just commentary. So here is more.
As I have mentioned, yesterday's uptrend was not sustainable. Today's worries have brought the reversal back very soon. Looking at the action in the market, it can be noticed that volatility is well managed with the use of CW and PW. A point I failed to address clearly in the last post was the idea of hedging. Warrants are used to hedge the opposite movement (just in case one is wrong). Although the cost of hedging can eat away profits, this cost is well spent when we think about managing our risk. Think of it as this, "it is easier to make less profits than it is to make large profits". So when we hedge and make less profits, risk is lesser and we make profits easier. If this is scaled up, it can make more, in terms of absolute amount of profits, with lesser risk.
Keeping "hedging" in mind, the activity of PW does not necessarily translate into an expectation of a bear market, it also shows that some are hedging against potential downside by shorting the Put when going long on the underlying. This takes into consideration that some may be doing this while trying to take advantage of lower prices.
Monday, 7 July 2008
Rebound
Announcements:
Posts from now on shall follow a specific format. This shall give readers a better and more systematic view of daily insights. And YES! Daily posting shall resume since there is something new in the market everyday.
Today's Market Action:
The local market surged 41.58 points today to close at 2934.12. CityDev led the Top Gainers, up $0.400 or 3.7% together with other index weights. Call Warrants (CW) dominated the Top % Gainers. Gold 10US$ led the Top Losers falling $1.52 or 1.6%. Standing with it are Put Warrants (PW). Top % Losers include blue-chip Calls and index Puts. The STI seems to have moved closely in tandem with the HSI and the N225 for today.
My Insights and Opinions:
The market has kept within my estimated band of 2900 +/- 50, hitting a low of 2862.27 on the 3rd of July. The current uptrend seems strong but a little too strong to be sustainable in the short term. Relative Strength Index (RSI)* from the 3-month chart shows that the market is moving into "range" territory between 40% to 60%. That can be a good sign in times of economic weakness. A future breakout may indicate a start of a recovery.
CW in the Gainers with PW in the Losers are a clear sign of a very short term uptrend. However, due to the implied volatility that CW and PW are subjected to, this clearly shows the volatility and corresponding uncertainty of the current market.
Considering the above points, my view on seizing opportunities still hold for a longer term outlook. However, current prices are unattractive in the short term.
*RSI = 100 - 100/(1 + RS) where, RS = Average of x days' up closes / Average of x days' down closes
Posts from now on shall follow a specific format. This shall give readers a better and more systematic view of daily insights. And YES! Daily posting shall resume since there is something new in the market everyday.
Today's Market Action:
The local market surged 41.58 points today to close at 2934.12. CityDev led the Top Gainers, up $0.400 or 3.7% together with other index weights. Call Warrants (CW) dominated the Top % Gainers. Gold 10US$ led the Top Losers falling $1.52 or 1.6%. Standing with it are Put Warrants (PW). Top % Losers include blue-chip Calls and index Puts. The STI seems to have moved closely in tandem with the HSI and the N225 for today.
My Insights and Opinions:
The market has kept within my estimated band of 2900 +/- 50, hitting a low of 2862.27 on the 3rd of July. The current uptrend seems strong but a little too strong to be sustainable in the short term. Relative Strength Index (RSI)* from the 3-month chart shows that the market is moving into "range" territory between 40% to 60%. That can be a good sign in times of economic weakness. A future breakout may indicate a start of a recovery.
CW in the Gainers with PW in the Losers are a clear sign of a very short term uptrend. However, due to the implied volatility that CW and PW are subjected to, this clearly shows the volatility and corresponding uncertainty of the current market.
Considering the above points, my view on seizing opportunities still hold for a longer term outlook. However, current prices are unattractive in the short term.
*RSI = 100 - 100/(1 + RS) where, RS = Average of x days' up closes / Average of x days' down closes
Sunday, 6 July 2008
Round Bottom Phenomenon?
After 6 "black candle" sessions, there is finally a white candle. Well, when there is a low, a little perk is what we can expect. The market closed on Friday at 2892.54, up 12.09 points from Thursday in a relatively weak upswing. Just when you think it is headed for doom, it crawls back after 330pm.
Right now, I would turn my sight on the US markets. The Singapore market is still reacting to how the US market has moved the night before.
The key word now is INFLATION. Such a simple concept that we often take for granted when all is fine and dandy. Here, I would like to take the opportunity of introducing Mosaic Theory. Mosaic Theory is an idea that people can piece together a picture of what is happening by putting together bits of random, seemingly unrelated information. By putting various sources of information together, here is my opinion of what is happening:
Commodity prices are obviously rising and this has not only driven inflation but also interest in the commodity market. Speculation can be expected to drive prices much higher if no intervention takes place for the short term. The root of all evil now is Oil. Oil is a necessity not only for energy purposes but also for transportation and cooking and it is what we eat too. If oil prices continue to skyrocket, which it probably will in the short term, there is no end to this inflation. Sounds like a non statement? Well, the thing is, I believe there is a price we are all willing to pay for oil and there is a conviction to increase production somehow and also a conviction of commercialising alternative sources of energy. Keeping this in mind, the high oil price will only make more expensive sources of energy more viable and put a stop to this frenzy soon.
That is easier said than done but the point is, the markets are not about to recover that quickly. This further supports my inclination to believe those that talk about a long recovery.
Good news for all. This also means that people have a longer time to seize opportunities when they come. We are all trying to spot a bottom but we don't have to. We just need the guts to tell ourselves to take the plunge in a bad market whether it is early or late and profit in a longer run.
Once again, this is an opinion. Readers, please feel free to challenge or question it. There have been no comments so far but it is welcome to spark a more lively platform.
Right now, I would turn my sight on the US markets. The Singapore market is still reacting to how the US market has moved the night before.
The key word now is INFLATION. Such a simple concept that we often take for granted when all is fine and dandy. Here, I would like to take the opportunity of introducing Mosaic Theory. Mosaic Theory is an idea that people can piece together a picture of what is happening by putting together bits of random, seemingly unrelated information. By putting various sources of information together, here is my opinion of what is happening:
Commodity prices are obviously rising and this has not only driven inflation but also interest in the commodity market. Speculation can be expected to drive prices much higher if no intervention takes place for the short term. The root of all evil now is Oil. Oil is a necessity not only for energy purposes but also for transportation and cooking and it is what we eat too. If oil prices continue to skyrocket, which it probably will in the short term, there is no end to this inflation. Sounds like a non statement? Well, the thing is, I believe there is a price we are all willing to pay for oil and there is a conviction to increase production somehow and also a conviction of commercialising alternative sources of energy. Keeping this in mind, the high oil price will only make more expensive sources of energy more viable and put a stop to this frenzy soon.
That is easier said than done but the point is, the markets are not about to recover that quickly. This further supports my inclination to believe those that talk about a long recovery.
Good news for all. This also means that people have a longer time to seize opportunities when they come. We are all trying to spot a bottom but we don't have to. We just need the guts to tell ourselves to take the plunge in a bad market whether it is early or late and profit in a longer run.
Once again, this is an opinion. Readers, please feel free to challenge or question it. There have been no comments so far but it is welcome to spark a more lively platform.
Wednesday, 2 July 2008
Lost of Direction
The market seems to have been a little lost today. It opened a little higher and surged about 14 points upwards before crashing about 35 points under the 2900 mark and then recovering to close 0.56 points lower than yesterday at 2906.23. A roller coaster ride indeed.
Even though today's action showed a glimpse of hope between 4pm to 5pm, the downward trend persisted after 5pm. I would expect tomorrow to be a bleak day. Wall Street continues to be weak today as this post is written. Technically speaking, all is not good.
Despite the gloomy days ahead, I would like to keep an optimistic outlook in suggesting that people look out for valuable buys. A point to note is that markets crash faster than they recover. This would mean that bad times are less than good times. Some might wish to go for speculative very short term trades. However, I am not in a good position to comment as a speculator and to advocate that. I am an analyst who looks more at the numbers, not a speculator.
Good news for readers as I am now developing a set of customised indicators that I can soon post a snapshot of and give all readers a picture of what I am writing about. Finally, pictures and explanations! Please do join my poll to give me feedback. I shall be constantly improving this site and providing better insights. Readers can expect posts to pick up in this volatile season however, the standard will still be kept to at least 1 post per week.
Even though today's action showed a glimpse of hope between 4pm to 5pm, the downward trend persisted after 5pm. I would expect tomorrow to be a bleak day. Wall Street continues to be weak today as this post is written. Technically speaking, all is not good.
Despite the gloomy days ahead, I would like to keep an optimistic outlook in suggesting that people look out for valuable buys. A point to note is that markets crash faster than they recover. This would mean that bad times are less than good times. Some might wish to go for speculative very short term trades. However, I am not in a good position to comment as a speculator and to advocate that. I am an analyst who looks more at the numbers, not a speculator.
Good news for readers as I am now developing a set of customised indicators that I can soon post a snapshot of and give all readers a picture of what I am writing about. Finally, pictures and explanations! Please do join my poll to give me feedback. I shall be constantly improving this site and providing better insights. Readers can expect posts to pick up in this volatile season however, the standard will still be kept to at least 1 post per week.
Tuesday, 1 July 2008
The Plunge
The market plunged lower today. The near term looks more bleak than expected. The market has reached 2906.79, down 40.75 in a single day. Although this 1.38% loss cannot be compared to the more than 2% losses 3 months ago, it is rather significant in bringing the market closer to its March levels.
Counters-wise, the 4 winning components of the market were out-numbered by the 26 losers. It is interesting to note that SembMar is now more expensive than Sembcorp. I would expect the price of the parent to be at least a bit higher. SingTel fell to 3.57, the tip of its previous bottom leg in the past month. Looking at the big black candle today and the dark cloud yesterday, SingTel can be expected to fall lower, bringing the index with it. The Banks, interestingly, are just starting to go "bear" from their RSI falling out of the 40% - 60% range.
My near term revision of "the bottom" is at 2900 +/- 50 now, shifting only 50 points downwards. The rationale here is that Wall Street indices are showing signs of a rounding bottom in the near term. The chances of yet another significant plunge is not likely in the near term unless oil prices continue to surprise us as they did last week. Regional indices like the HSI and Nikkei as carefully coupled as well. On the part of the counters here, most index counters have hit their lows. Further downside is possible but may not be very significant. This shall play a part in supporting the index numbers.
Buy period can be soon. I shall be carefully monitoring the situation and providing my reports. Keep watch daily these few days to get up-to-date highlights.
Counters-wise, the 4 winning components of the market were out-numbered by the 26 losers. It is interesting to note that SembMar is now more expensive than Sembcorp. I would expect the price of the parent to be at least a bit higher. SingTel fell to 3.57, the tip of its previous bottom leg in the past month. Looking at the big black candle today and the dark cloud yesterday, SingTel can be expected to fall lower, bringing the index with it. The Banks, interestingly, are just starting to go "bear" from their RSI falling out of the 40% - 60% range.
My near term revision of "the bottom" is at 2900 +/- 50 now, shifting only 50 points downwards. The rationale here is that Wall Street indices are showing signs of a rounding bottom in the near term. The chances of yet another significant plunge is not likely in the near term unless oil prices continue to surprise us as they did last week. Regional indices like the HSI and Nikkei as carefully coupled as well. On the part of the counters here, most index counters have hit their lows. Further downside is possible but may not be very significant. This shall play a part in supporting the index numbers.
Buy period can be soon. I shall be carefully monitoring the situation and providing my reports. Keep watch daily these few days to get up-to-date highlights.
Thursday, 26 June 2008
A weekly update indeed
As I mentioned, there shall be weekly updates on this site. There will be. Thank you, the readers.
The Singapore market has seen a little intra-day spike today, in line with the Dow and Hang Seng. The Nikkei seems like it is beginning to decouple however, there is no clear indication of that in the near term.
Blue chips that I have been watching on the local market have dipped significantly with counters like Kep Corp now under $11 and F&N in the $4.50 range. Popular Yangzijiang shipbuilder has fallen approximately 10% in the past few weeks.
The Fed's "hold" stance on Fed funds rate has caused a short live exuberance to the market until the realisation that required rate of return shall remain low or the time being. This has made equities less attractive in this inflationary environment.
Back to the market, today's little "tombstone" candlestick could well spell the death of optimism that started just yesterday. The near term can be expected to be down. However, considering the Singapore market's coupling with the US and regional markets, I would not consider revising my target of 2950 +/- 50. The DOW has reached it's March levels. Market sentiment there is negative but March's recession fears have been softened. Significantly further downside is unlikely. Japan has been doing better than Hong Kong and Singapore, a slight divergence has been noticed in the past month. Hong Kong has been moving very closely in line with the Singapore market which can be observed to be taking cues from the US.
I am currently watching for a bottom, buying spree.
The Singapore market has seen a little intra-day spike today, in line with the Dow and Hang Seng. The Nikkei seems like it is beginning to decouple however, there is no clear indication of that in the near term.
Blue chips that I have been watching on the local market have dipped significantly with counters like Kep Corp now under $11 and F&N in the $4.50 range. Popular Yangzijiang shipbuilder has fallen approximately 10% in the past few weeks.
The Fed's "hold" stance on Fed funds rate has caused a short live exuberance to the market until the realisation that required rate of return shall remain low or the time being. This has made equities less attractive in this inflationary environment.
Back to the market, today's little "tombstone" candlestick could well spell the death of optimism that started just yesterday. The near term can be expected to be down. However, considering the Singapore market's coupling with the US and regional markets, I would not consider revising my target of 2950 +/- 50. The DOW has reached it's March levels. Market sentiment there is negative but March's recession fears have been softened. Significantly further downside is unlikely. Japan has been doing better than Hong Kong and Singapore, a slight divergence has been noticed in the past month. Hong Kong has been moving very closely in line with the Singapore market which can be observed to be taking cues from the US.
I am currently watching for a bottom, buying spree.
Thursday, 19 June 2008
Good news and Bad news
Good news for all who read this blog. I shall be maintaining my posts to at least 1 per week to provide readers with a weekly digest. More details later. Watch this space!
Bad news, the market does not seem to be doing well now, even though there was an early rally this week. It finished 47.43 points lower to 2992.66 falling into my target range of 2950 +/- 50. The RSI on the STI indicates possible bear market to follow. I am considering revising my target range downwards.
On the other hand, current sentiments, as seen from 5-day candle sticks indicate that there are sentiments keeping the market afloat in the very short term. This may cause the market to range in the short term when the bulls keep fighting the bears. Right now, the market is also in a sort of "wait-and-see" mode. This may further affirm the range phenomenon.
A strategy one can adopt now is to follow the "wait-and-see" mode. Afterall, we all hope to ride on a wave. Now, we can all wait for better weather before we set sail. However, those with a longer horizon and are not sensitive to short term fluctuations may want to take advantage of the low prices on certain counters.
Bad news, the market does not seem to be doing well now, even though there was an early rally this week. It finished 47.43 points lower to 2992.66 falling into my target range of 2950 +/- 50. The RSI on the STI indicates possible bear market to follow. I am considering revising my target range downwards.
On the other hand, current sentiments, as seen from 5-day candle sticks indicate that there are sentiments keeping the market afloat in the very short term. This may cause the market to range in the short term when the bulls keep fighting the bears. Right now, the market is also in a sort of "wait-and-see" mode. This may further affirm the range phenomenon.
A strategy one can adopt now is to follow the "wait-and-see" mode. Afterall, we all hope to ride on a wave. Now, we can all wait for better weather before we set sail. However, those with a longer horizon and are not sensitive to short term fluctuations may want to take advantage of the low prices on certain counters.
Thursday, 12 June 2008
Trying times ahead
Our market opened 1.8% lower this morning and closed 0.9% down at 3020.15. The candle however, was a big white candle. Based on these two points, the market seems to be sparingly optimistic to a certain extent.
The very short term outlook however, is relatively bleak. With inflation hitting markets all over the world, sentiments on business for the rest of the year is gloomy. On the other hand, recession fears are not as strong as in March, from the fact that a slowing economy is not a contracting one.
With Fed rates expected to rise, the expectation on the market for return will rise in tandem. This will raise the bar on equities to cause rating downgrades in certain cases. My current outlook on the effects of this will be a slow recovery from the current dip which has yet to find its bottom.
Considering all the above factors, we can expect the next support of the STI to be lowered to about 2950 +/- 50. My reason for this is that with recession fears lifted while inflation fears persist, market value will fall close to March levels but not to March levels or below. Price inflation means that the PV of stocks, as compared to before, should be higher to reflect their old value. That can keep the market afloat at least in the near term.
As long as the hope of a late year rally still remains, there is no reason to fear a collapse. In fact, those who believe in it are likely to buy-and-hold in such a time and fulfill the prophesy.
The very short term outlook however, is relatively bleak. With inflation hitting markets all over the world, sentiments on business for the rest of the year is gloomy. On the other hand, recession fears are not as strong as in March, from the fact that a slowing economy is not a contracting one.
With Fed rates expected to rise, the expectation on the market for return will rise in tandem. This will raise the bar on equities to cause rating downgrades in certain cases. My current outlook on the effects of this will be a slow recovery from the current dip which has yet to find its bottom.
Considering all the above factors, we can expect the next support of the STI to be lowered to about 2950 +/- 50. My reason for this is that with recession fears lifted while inflation fears persist, market value will fall close to March levels but not to March levels or below. Price inflation means that the PV of stocks, as compared to before, should be higher to reflect their old value. That can keep the market afloat at least in the near term.
As long as the hope of a late year rally still remains, there is no reason to fear a collapse. In fact, those who believe in it are likely to buy-and-hold in such a time and fulfill the prophesy.
Tuesday, 10 June 2008
Back in action
It has been about a month since I posted an entry.
The market has taken a turn and shed about 100 points in the past 2 days. Even though the outlook does not seem bright, in my opinion the support shall remain firm at 3000 +/- 50. Despite the coupling with tumbling Asian markets, there is no reason for the market here to fall far below this support considering the stabilising Dollar and rising US interest rates for the moment.
The short term outlook is that the market shall continue to range and the possibility of a late year rally still lingers. In such a time, it can be a wise strategy to go for yield or total return. Capital gain is difficult for the average retail investor who has limited resources to respond to short fluctuations. In a time like this, cheap buys can be picked up for late growth companies and mature companies. These picks offer stability and assurance in such times as well as decent dividends. A cheap buy can mean a decent capital gain on top of dividends.
Another way to reduce uncertainty is to go for index weights or buy into structured index linked products. However, this is only for those who have a longer time horizon in mind.
Think risk and return.
With US Fed rates about 4% and equity risk premium of 7% on average in the Singapore market, a decent return can be expected for now.
The market has taken a turn and shed about 100 points in the past 2 days. Even though the outlook does not seem bright, in my opinion the support shall remain firm at 3000 +/- 50. Despite the coupling with tumbling Asian markets, there is no reason for the market here to fall far below this support considering the stabilising Dollar and rising US interest rates for the moment.
The short term outlook is that the market shall continue to range and the possibility of a late year rally still lingers. In such a time, it can be a wise strategy to go for yield or total return. Capital gain is difficult for the average retail investor who has limited resources to respond to short fluctuations. In a time like this, cheap buys can be picked up for late growth companies and mature companies. These picks offer stability and assurance in such times as well as decent dividends. A cheap buy can mean a decent capital gain on top of dividends.
Another way to reduce uncertainty is to go for index weights or buy into structured index linked products. However, this is only for those who have a longer time horizon in mind.
Think risk and return.
With US Fed rates about 4% and equity risk premium of 7% on average in the Singapore market, a decent return can be expected for now.
Wednesday, 14 May 2008
Steady Up?
I had a sudden argue to comment about this. The market seems to have been rising steadily in the past 2 trading days. This is to be taken note of. If such a phenomenon persists for a good length of time, it can be time to trade an upswing. But beware of going in too late cos profits may have been diminished.
Friday, 9 May 2008
100 points off for the week
The STI shed 9.85 points today to finish at 3162.03. All in all, the market has lost 100 points in this week's trading. A bit more than the flat week predicted by analysts in the news.
Heavy weight SingTel fell almost 20 cents this week while SGX almost 80 cents! For the banks which declared their Q1 earnings this week, DBS lost more than 40 cents, UOB almost 80 cents and OCBC lost about only 20 cents. OCBC seems to have been spared a larger drop due to its price and also its release of strong Q1 profit margins.
As usual these few days, my outlook remains bear. I have been contemplating on whether to release my opinions weekly instead of daily, so as to add more value. Day to day fluctuations have not been fantastic recently and it seems to have become a bit less interesting.
Heavy weight SingTel fell almost 20 cents this week while SGX almost 80 cents! For the banks which declared their Q1 earnings this week, DBS lost more than 40 cents, UOB almost 80 cents and OCBC lost about only 20 cents. OCBC seems to have been spared a larger drop due to its price and also its release of strong Q1 profit margins.
As usual these few days, my outlook remains bear. I have been contemplating on whether to release my opinions weekly instead of daily, so as to add more value. Day to day fluctuations have not been fantastic recently and it seems to have become a bit less interesting.
Down Down
The market plunged 57.07 points today finishing at 3171.88. The morning session was bad as the market fell more than 75 points before lunchtime. After lunch, market action picked up a little to range until the finish. After 5pm trading was relatively flat as well.
There seems to be no glimpse of a good upside for now. Friday may be a white candle day but in my opinion, this is unlikely. The market tends to be conservative on Fridays. Current short term outlook is bear. No change until the target resistance of 3000 +/- 50 or until any good news changes current sentiments completely.
There seems to be no glimpse of a good upside for now. Friday may be a white candle day but in my opinion, this is unlikely. The market tends to be conservative on Fridays. Current short term outlook is bear. No change until the target resistance of 3000 +/- 50 or until any good news changes current sentiments completely.
Thursday, 8 May 2008
Down from here?
The market dropped 19.80 points to close at 3228.95. So far, it has kept well to my 3250 +/- 50 resistance estimates. However, I do not rule out the possibility that my estimates can be wrong. We all would wish for a better market.
Today's downturn may mark the start of a downswing keeping the market in range behaviour. This provides it does not break its support, my opinion is that this should be at 3000 +/- 50. This shall signal a range market that might well be the start of a new cycle like I mentioned before. If it does break the support, the next support would be somewhere around 2800 +/- 50 where it was before. Simple estimates based on the charts and using some Fibonacci retracements and projections.
For now, I would continue to monitor the charts for buy signals and opportunity. In this high inflationary environment, investing in business trusts can be a good option as these hold real assets like ships, buildings and infrastructure. I would think of looking for opportunities in these areas.
Today's downturn may mark the start of a downswing keeping the market in range behaviour. This provides it does not break its support, my opinion is that this should be at 3000 +/- 50. This shall signal a range market that might well be the start of a new cycle like I mentioned before. If it does break the support, the next support would be somewhere around 2800 +/- 50 where it was before. Simple estimates based on the charts and using some Fibonacci retracements and projections.
For now, I would continue to monitor the charts for buy signals and opportunity. In this high inflationary environment, investing in business trusts can be a good option as these hold real assets like ships, buildings and infrastructure. I would think of looking for opportunities in these areas.
Tuesday, 6 May 2008
Overbought?
The market closed 0.71 points up at 3248.75. Yup prices have remained high. Analysts are saying that the market is overbought. Considering the rise in prices of the weights, the "heavier" weights have not advanced as much as the "lighter" ones.
If the market is going to remain bullish. Today's steady trend will signal the start of a new cycle. Otherwise, the market has peaked for now. One can be weary of a breakout at such a stage as there is a good chance that the breakout will signal a turnaround.
The thing I would watch now are the candlesticks. Yesterday looked like a shooting star while today seems like a doji. The market has kind of lost its sense of direction now. I would continue watching before taking any further action.
If the market is going to remain bullish. Today's steady trend will signal the start of a new cycle. Otherwise, the market has peaked for now. One can be weary of a breakout at such a stage as there is a good chance that the breakout will signal a turnaround.
The thing I would watch now are the candlesticks. Yesterday looked like a shooting star while today seems like a doji. The market has kind of lost its sense of direction now. I would continue watching before taking any further action.
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