Market Comments (DJI / HSI / STI) For Week of 29 Apr 2013

DJI 29 Apr 13

HSI 29 Apr 13

STI 29 Apr 13

Dow Jones – The index has tried to climb from its older support of 14,450 – 14,500. However, it has met with its previous support turn resistance at 14,680. Currently, the index has been ‘trapped’ between these zones. Until the index break free of 14,680, the next strong resistance is at 15,100 to 15,200.

HSI – The Hang Seng Index has cleared its resistance of 22,521 last Friday. It has also broken the down sloping resistance trend line. Last Friday candlestick is somewhat doji. We need to observe for 1-2 more days to ensure that it is not a false breakout. If the index can remain above these levels, then we can expect the index to make its way to recovery. Trader may enter once you can establish that it is not a false breakout, or a safer way is wait for a higher low to form.

STI – The Straits Times Index finally broke out of its trading range with last Thurs/ Fri index closing above its resistance line. It has also broken its previous high of 3,331 clearly. As accurately pointed out last week, the STI has gathered enough momentum and broke out. Let’s observe the STI’s performance for a couple of days more before commenting further.

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Book by Dr Jacinta Chan – A Glimpse

JacintaChan

Recently, I have come across a book by Dr Jacinta Chan. As I was having some time in the bookshop, I browsed through the book and found some of her words which are rather strong but enlightening. I wish to share her words and I shall quote this paras from her book:

A Note to the Trading Apprentice

Do not be fooled by randomness

Why should we spend time arguing with the random walkers when we can be quietly making profits? Let the professors continue to teach random walk theory in business schools. Why should we bother them in their academic world when we can be making profits in ours? The person who is right in the market is the one who makes money in the long run.

Random walk was what I learnt in school. But in what seems to be randomness, there are repeating patterns. This is what advocated in fractal geometry theory by the reowned mathematician Benoit Mandelbrot. Our task here is to decipher some of the helpful patterns with professional technical tools to harvest profits in the repeating habits of history.

Let the research analysts do their fundamental research; we do not need it. Fundamental analysis course have cost me and many others many years of missed profits. This is what I meant when I said, not only do you not need a finance or economics degree to trade, you are much better off without one. You just need to know what the professional traders who are making money in the market know.

You will have realised by now that technical analsysis, whether involving subjective pattern recognition or mechanical trading systems, is based on the four concepts of price-volume relationship, trading ranges, trend identification and buy and sell signals that we learnt about earlier.

– Dr Jacinta Chan
Financial Times Guides to Technical Analysis: How to trade like a professional

Dr. Jacinta Chan trades equities and futures. She has a Ph.D. in financial statistics and teaches finance. Her research is focused on adjustable trading algorithm systems, tested on futures.

Market Comments (DJI / HSI / STI) For Week of 22 Apr 2013

DJI 19 Apr 13

HSI 19 Apr 13

STI 19 Apr 13

Dow Jones – The index has retraced to its older support of 14,450 – 14,500 last Friday (19 Apr 13). Day trader who stoodby this level and enter long would have benefit by now. DJI strongly rebounded to 14,719 on Tues 23/4. Do expect wider swings and higher volatility as the index climibs higher. The next strong resistance is at 15,100 to 15,200.

HSI – The Hang Seng Index made a strong climb last Friday (19 Apr) to 22,013. HSI has been making low since the start of the last week till Thurs, where it was nearly its support of 21,280. The index is in a short to medium term downtrend. The down momentum is likely to continue and thenext support zone is around 21,080 to 21,280. For a reverasl to occuer, the index must clear resistance 22,521.

STI – The Straits Times Index is still trapped in the rectangle (sideway). We shall expect STI t0 continue its sideway movement until it breaks its upper channel resistance and previous high of 3,331 clearly. However, from my observation, STI has been sticking on the upper reistance line. If this continues, it maybe soon that the STI gathers enough momentum to move up, breaking away from its restiance.

CDL, Capitaland & Kepland – for week of 22 Apr 13

CDL 19 Apr 13

Capitaland 19 Apr 13

Kepland 19 Apr 13

After the cooling measures announced in mid January this year, our local property stocks have been in the doldrums. Lately, they seems to make a come back. The above chats of CDL, Capital Land and Kepland seems to tell us that the counters have reached their supports and is ready to bounced back. CDL and Capitaland have yet reverse. However, I can see that Kepland is making its way up. Usually for property stocks, they will follow each others. If there is no major incident occurring that will adversely affect the markets, I would foresee that CDL and Capitaland will follow suits and climb like Kepland.

U.S. Companies That Track Terrorists, Aid Homeland Security and Sell to Law Enforcement

24/7 Wall St.

78480119America lost its ability to ease into the thought that it was safe again on Monday after the Boston Marathon bombs killed three people and injured more than 100. This is very unfortunate, and for many of us it brings back the concerns and fears of 2001 to 2003. After Boston was hit with dual bombings around the finish line of the marathon, security levels were raised in New York, Washington D.C. and elsewhere. Now new reports have tied in other packages, and a report on Tuesday showed that a suspicious package has been found in LaGuardia Airport in New York City. President Obama has even said that the FBI is investigating this incident as though it is an act of terrorism.

Needless to say, you can bet that airport security and security at public events will be now be alerted and higher. If the trends do manage to escalate, America…

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Market Comments (DJI / HSI / STI) For Week of 15 Apr 2013

STI 12 Apr 13

HSI 12 Apr 13

DJI 12 Apr 13

The Dow Jones has broken its resistance of 14,860 on Wed, turning this level from resistance to support. If the strength continues, we are likely to see the index hiting its next resistance of 15,100 to 15,200. Trader wanting to enter can wait for slight pull back towards 14,860 and enter long. There are probably some consolidation in the coming week before DJI making its way towards the 15,000 mark.

HSI – The Hang Seng Index was being rejected nicely by the resistance level of 22,185. The index is in a short to medium term downtrend. If you plot in the moving average, it is below 100 days moving averages but supported my the 200 days moving averages. Both the CCI and MACD are negative. The down momentum is likely to continue and we are looking at next support zone at around 21,080 to 21,280.

STI – The Straits Times Index has been trapped in the rectangle (sideway) for the last 2 months. CCI is negative again and MACD has crossed its signal line. We shall expect STI t0 continue its sideway movement until it breaks its upper channel resistance and previous high of 3,331 clearly.

The Case For $1300 or Even $1200 Gold… It May Actually Be a Good Thing

24/7 Wall St.

Gold and SilverThe gold bugs are getting squashed and flushed down the drain as gold continues its slide. After breaking the $1500 mark on Friday there are some key calls to consider as gold could get down to $1400, $1300, or even $1200 per ounce.

The big call earlier last week was from Goldman Sachs Group Inc. (NYSE: GS) saying to get out of gold and to short sell gold. The highly influential trading and investment banking firm predicted that gold would end 2013 at $1450 per ounce and that it could sink to $1270 by the end of 2014. The analyst team that made this call even went on to predict that if these price predictions turn out to be correct that the falling gold prices could even be larger and faster than the firm expects.

Our question on this is the pre-trade timing of this. How much gold was…

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Crude Oil Could Fall Below $90 Real Soon Now

24/7 Wall St.

Oil price fall graphicThe spot price for WTI crude briefly fell to $90.27 this morning and still trades well below yesterday’s closing price of $93.51. The AAA Daily Fuel Gauge reports that the average U.S. pump price for a gallon of regular gasoline sits at about $3.56 today, which is $0.06 a gallon less than it cost a week ago and more than $0.30 a gallon below last year’s price. And all the signals are that the price will continue to fall.

Consumer sentiment fell sharply — and unexpectedly today — and U.S. retail sales were also lower. Part of the reason for the lower retail sales turned out to be lower gasoline sales, even though the price was dropping. U.S. drivers take to the roads less because they don’t have the will, or perhaps the money, to go shopping.

That’s not likely to change next week. Recent demand estimates from both OPEC…

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Market Comments (DJI / HSI / STI) For Week of 8 Apr 2013

DJI 5 Apr 13

HSI 5 Apr 13

STI 5 Apr 13

DJI – The Dow Jones was accurated rejected by resistance level 14,680 last Wed. Its immediately support is at 14,450 – 14,500 zone. Currently, the index is trap within a tight traingle of 14,680 and the upper ceiling of the trend channel. Once the index break this triangle, we will see a clearer direction. At the moment, indicators points towards reversal. Both CCI and MACD are turning down. If the index indeed break down of the triangle, we are looking at next support between the region of 14,120 to 14,230.

HSI – The Hang Seng Index was being rejected nicely by the support-turned-resistance levels of 22,521 and 22,185. The index is in a short to medium term downtrend. If you plot in the moving average, it is below 100 days moving averages but supported my the 200 days moving averages. The down momentum is likely to continue and we are looking at next support zone at around 21,080 to 21,280.

STI – The Straits Times Index has hit its sideway resistance and is turning down. It has completed an evening doji star pattern and will be continue to be trapped in the rectangle (sideway). CCI is turning down again and MACD bearish divergence. STI will remain rather unexciting in the coming week.

24/7 Wall St.

GermanyJust when it seemed that the economic data from the European Union could not get worse, new service sector purchasing managers index (PMI) information from Markit shows that the collapse in most countries in the region has accelerated. Even Germany did not dodge the fallout.

The data will open the debate, which now occurs daily, about whether austerity actually closes national deficits or widens them as lack of stimulus pushes gross domestic products into negative territory.

Recall, a PMI measurement of less than 50 signals contraction.

According to Markit:

At 46.5 in March, the final Markit Eurozone PMI Composite Output Index was unchanged on the flash reading, confirming that the rate of decline in activity accelerated for the second month in a row to reach the fastest since last November.

The PMI shows that output has fallen in each of the past 19 months with the sole exception of a marginal increase at the start of…

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