Trading Ideas for Week of 27 Jul 09

A Look At the Big Picture - DJIA: The DJIA has broken the 9000 resistance! The key question is whether the market is able to hold the 9000 support level, or could this be a "bull trap"? Indicators on the weekly chart suggest that there are some more room for DJIA to run in the coming few weeks. Looking back in the last quarter, the DJIA charged ahead when the earnings reporting started amidst the theme of "less bad is good". It then consolidated for over a month with investors (or speculators) saying that "less bad is not good" anymore. Concrete earnings need to be demonstrated for the market to move ahead. And yes, the quarter has delivered +ve "better than expectations" earnings, propellng the DJIA past the Jun's high. Same pattern of market movement, although with different theme. If this similarity holds true, we will be expecting another 2-3 weeks of bull run before the next ccrrection comes along, after most of the earnings are reported. The reason for the correction - +ve earnings is not good enough as this is generated mainly from cost cutting measures, we need to see +ve revenue too! In the coming week, we could see the DJIA testing the newly established 9000 level. If this support level is breached, the DJIA should be able to hold 8870.



STI: The STI has propelled ahead, with many of the index stock breaking its Jun highs. This is yet another bull run led by the property sector. Next in focus will be the oil&gas, commodity and banking sector. We've seen some volume expansion in some of the commodity and oil&gas stock counters over the last few trading days. If the market remains bullish in the next few days, we could see more highs broken from the stocks in these sectore. The rapid advance over the last week has placed the indicators in the overbought region, be ready to expect some pullbacks. Strong support level is expected at 2400-2450 level; on the upside, the STI could test 2624 in the next few days.

My Stock Pick from Indicators Watch:
LONG : CAPITAL LAND, OLAM, SINGPOST


Disclaimer: My assessment of STI is for fun reading only. It is not an inducement to buy or sell nor an investment advice. By reading this blog, you have agreed that I shall not be responsible for any profits or losses based on the information provided.

Trading Ideas for Week of 29 Jun 09

A Look At the Big Picture - DJIA: The DJIA has consolidated over the last 2 weeks and established a support at 8250. Indicators are turning positive - MacD has turned green over the last 2 sessions, indicating positive sentiment returning; the oversold stochastic is poised to recover and the recent low did not break the previous low. 8250 appeared to be a strong support. However, there are still some dark clouds to watch. We're likely to see the DJIA testing the 200MA and 20MA resistance in the next few days. A failed test of 20MA could result in more downsides over the next few weeks. While a break out of 20MA will provide more positive outlook for DJIA to break the 9000 mark.


STI: STI has formed another higher low. This is a positive sign as the last 2 weeks of consolidation will give it enough momentum to break the 2400 resistance. Indicators are also showing bullish signs. Key action to watch in the next few days will be the 20MA resistance. A failure to break this line will result in more downside.

My Stock Pick from Indicators Watch:
LONG : UIC, SIA Engineering


Disclaimer: My assessment of STI is for fun reading only. It is not an inducement to buy or sell nor an investment advice. By reading this blog, you have agreed that I shall not be responsible for any profits or losses based on the information provided.

Trading Ideas for Week of 15 Jun 09

A Look At the Big Picture - DJIA: The DJIA moved in a tight range amidst the growing voices of the end to a bear rally over the last 1 week. Indicators showed that the market is in an overbought position. Although the +DI is in the bullish zone, its convergence towards the -DI indicates a waning of strength in the bull. The DJIA is in a cross-road, yet again. A break above the 9000 would provide investors with another signpost for more upside to come in the coming weeks. The support for DJIA is in the 8600 region, which is also the 20MA support level. A break below this level will post the initial warning signs of a possible change in trend and mood. I'm cautiously bullish of the market. Key events that could rock the markets: Reaction to the G8 meeting, Iran presidential election and N. Korea's reaction to the sanctions.



STI: Many black candles in the STI over the last 2 weeks. The STI is in a consolidation phase, at the same time, it is also attempting to test the 2400 resistance level. The good thing to cheer is that the STI is trending along the 5 EMA support line. However, its convergence towards the 20MA line indicates a slowing down of the bull trend. Over the next 1 week, the STI could see further consolidation. A break above 2400 with high volume will be a good signpost for more upside. While the breakdown of the 20MA support level will potentially points to more bearish sentiments.

My Stock Pick from Indicators Watch:


Disclaimer: My assessment of STI is for fun reading only. It is not an inducement to buy or sell nor an investment advice. By reading this blog, you have agreed that I shall not be responsible for any profits or losses based on the information provided.

Trading Idea for Week of 25 May 09

A Look At the Big Picture - DJIA: Is this the end of the DJIA rally? Indicators has shown signs of resistance over the last 1 week. The DJIA was unable to break the long term resistance trendline and has formed a descending triangle, hanging precariously to the 8205 support level. A break below the support line could see DJIA retracing to 7900 i.e. 200MA support line. A retracement towards 7900 is perhaps a healthy sign, I think...and a good opportunity to collect some good stocks. There will be a series of release of economic figures next week, with anaylst predicting them to be "less bad" compared to the previous quarter. If this is indeed the case, the DJIA is likely to hold above 8200.




STI: The STI has shown more rsilient indicators and possibly more legs to run! Given the strong volume and a break above the long term resistance trendline, it is likely to continue its advance. The next few days could be choppy though, as the overbought indicators could suggest some consolidation taking place. However, it is unlikely to have significant downward move to trigger panic selling. Any dips are potenial opportunity to catch up on the previous weeks' lose opportunities. On the downside, the STI will see strong support at 2100.

My Stock Pick from Indicators Watch:
LONG: COSCO Corp, Yellow Pages, Rotary, Ezion Holdings


Disclaimer: My assessment of STI is for fun reading only. It is not an inducement to buy or sell nor an investment advice. By reading this blog, you have agreed that I shall not be responsible for any profits or losses based on the information provided.

Trading Ideas for Week of 11 May 09

A Look At the Big Picture - DJIA: The DJIA has consolidated around the 8200-8400 level over the last 2 weeks and is looked set to charge ahead. The +ve DIs and rising ADX points towards a continuing uptrend. However, stochastic is in the overbought region, suggesting some consolidation may take place in the days ahead. Given the strong uptrend, the pullback may not be severe. On the downside, it could perhaps retest the 8200-8400 levels to establish this as a firm support level. On the up side, DJIA could be flirting with the thrice tested 9000 levels. Breaking beyond 9000 would be tenuous in the short term, the market would require strong economic indicators to support it. I'll be watching out for the volume on the black candle stick days. If volume is heavy, it will indicate that the bulls may take a turn for the bears. On the contrary, a light volume during black candlestick days, wuld further reaffirm that the uptrend is still intact. Prices tend to overshoot in a bull rally and undershoot in a bear rally. The key question now is has the price overhoot? Or is it recovering from the undershoot bear in March?




STI: STI has charged furiously over the last 1 week, it's performance far surpassed the other markets around the world. It has broken the twice tested resistance at 1950 and crack through the 200MA resistance. The +DI and rising ADX suggest that an uptrend is in place. However, there are indicators that the bull is tired. The shooting star candlestick on Fri close, the red histogram MacD and overbought stochastics points towards a possible consolidation in the days ahead. The 200MA support line would serve as a strong support. This would attract more investors to buy during the dips. As the blue chips has been rising like a runaway gun, there is likely to have significant interest in the 2nd-tier penny stocks (especially oil&gas sector) as those who has missed the action would not want to be left behind. As most of the stocks has run up too fast, there are opportunities to short some of the counters. A good profit target would be either the 14EMA or 20MA support line.

My Stock Pick from Indicators Watch:
SHORT: SIA, MCL Land, Capital Land, Golden Agri


Disclaimer: My assessment of STI is for fun reading only. It is not an inducement to buy or sell nor an investment advice. By reading this blog, you have agreed that I shall not be responsible for any profits or losses based on the information provided.

Trading Ideas for Week of 20 Apr 09

A Look At the Big Picture - DJIA: Overbought indicators seems to suggest that the bull is going to take a break, hitting trendline resistance. However, the uptrend seems to be intact (+ve DI). The bearish divergence 2 weeks ago seemed to have dissipated with volume coming in over the last 1 week. DJIA will probably test the 20MA support (7870) this week. If it is able to hold the support line, the bull will continue to charge again. If DJIA is able to break above Friday's close, it will be a positive indication of a continuing uptrend. Otherwise, watch out for 20MA support. If this breaks down, we will perhaps see a retracment to 7500 level.



STI: STI also needs a break. Indicators shows that STI is highly overbought. However, a clear uptrend (+DI and rising ADX) is developing. This is perhaps fuelled by the Shanghai and Hong Kong market. But there are strong headwinds
ahead. The resistance at 1950 seems to be a strong one. Beyond 1950, there is a 60 points gap as well as the 200MA resistance that needs to be broken. A retracement towards the 20MA support line (1830) will be a healthy sign to give the STI the energy to charge ahead. The uptrend is still intact as long as the 20MA support hold. Otherwise, we'll expect the correction to test 1700 level.

My Stock Pick from Indicators Watch:
Nil from Indicator watch.

Disclaimer: My assessment of STI is for fun reading only. It is not an inducement to buy or sell nor an investment advice. By reading this blog, you have agreed that I shall not be responsible for any profits or losses based on the information provided.

Trading Idea for Week of 6 Apr 09

A Look At the Big Picture - DJIA: The Dow has shown signs of recovery. The million dollar question is, "Is it time to buy?". I'm cautiously optimistic. Shortist beware... At best, it will continue recovery; at worst, it will move sideway for another few weeks in search of the next trend direction. We are at a key crossroad, the chart has formed a classical ascending triangle. However, does the market have enough strength to break the resistance line? My guess is perhaps yes, but not this week as the market has been grossly overbought. The volume has been declining as the DJIA rises. This price/volume bearish divergence is a sign of imminent trend change. Hence, some consolidation is expected in order for the bull to gain strength before it charges again. The catalytic news would be the quarterly earnings results of the big banks. Given the implementation of the mark to market accounting rules, the banks could report positive earnings for the quarter. Could this be the catalyst? Maybe yes, maybe no. It depends on how investor perceive the effects of this new rules.


STI: The outlook for STI is more positive than the DJIA. The rise in the ST Index has been supported with good volume. This is a sign of strength of the market. The market could garner enough strength to break above the ascending triangle. I guess many investors at the sideline over the past few weeks were afraid that they may be left behind, and started to buy into the market. However, beware. Whether the trend is sustainable would depend on the performance of the DJIA. Many of the local counters are grossly overbought. A better strategy is to wait for a pull back and buy at key support lines. In an uptrend, the Index will likely be supported by the 20MA line, similarly for the various stock counters. Patience is the name of the game.

My Stock Pick from Indicators Watch:
Nil from Indicator watch.

Disclaimer: My assessment of STI is for fun reading only. It is not an inducement to buy or sell nor an investment advice. By reading this blog, you have agreed that I shall not be responsible for any profits or losses based on the information provided.