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Technical Rebound Or Reversal?
As stated in my post on Saturday, STI was sitting at a channel support. The index was grossly oversold the past 2 ~ 3 weeks. Therefore, the strong rally today is not unexpected. My take is that this is a technical rebound rather than a reversal. The index has now arrived at the channel resistance. And since the rebound was so sharp, profit taking should set in pretty quickly ( eg: Friday morning up, after down... or on Monday ? ).
The subsequent movement of the index will depend on the momentum:
1. If the buying momentum persists after some profit takings, it may advance to test the 20DMA ( around 1900 ),
2. If it is able to conquer that level, next test will be 2050,
In order for STI to be out of the wood, the index need to clear three more hurdles:
1. It must clear 2,500 convincingly. If the buying momentum weakened at this point couple with PTI >35 ( PTI = Profit Taking Index ), there is a 80% chance where STI will tumble hevayly to mark new low ( below 1,400 )
2. Next, if the index is able to clear 2,500 but buying momentum weakened at 2,700 and PTI >35, there is 60% chance where STI will tumble heavily to mark new low ( below 1,400 )
3. If STI is able to clear 2,700 and head toward 2,800. The chances of it tumble down to test new low is very slim. PTI is no longer important at this level. In other word, the market has recovered.
The above was derived from a trading system I am evaluating. I have absolutely no idea whether it is accurate or not. I do not know the time frame too. But I think it will take a while for STI to move up a thousand points from 1,800 to 2,800 if it is accurate at all. One thing though which I had a shock of my life is that the system has accurately predicted the index is heading toward 1,820 and it did happen today, quite scary! The resistance levels mentioned here are not based on Fibonacci or other classical TA. They are proprietary figures.
Let's see.... time will tell. I have no clue whether this is a valuable tool or simply rubbish. Also, the above scenarios were under the assumption IF the buying momentum persists. If the buying momentum deminished quickly after the strong rebound today, we will see STI heading south again right away.
Labels: Trading Digest
1,600 - A Strong Defense!
Asian markets rebounded strongly today. Nikkie & HSI reclaimed almost all the lost ground. STI rebounded too ( +66.21 or 4.1%, closed 1,666.49 ) but not without a vicious selling in the morning ( low 1,473.77 ). STI is well known to be unforgiving but I still find the morning heavy selling unnecessary amidst other Asian bourses rebounding. 1,600 has proven to be a strong support despite being violated on Friday & today.
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.Amidst the market volatitity, I have devoted much of my time lately scouting for a good trading system. Here is something quite inspiring while reading though the manual of one such system:
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The concept behind successful trading is relatively simple: it is about making money. One of the most common approaches to this is using technical analysis, which tries to predict or forecast where a market will be at some point in the future. The idea is that if you know where a market is headed, then you can profit from that movement, However, and it is a big however, what most analysts do not fully appreciate is that the future is uncertain. And because the future has not happened yet, how it unfolds is out of your control. This is why trading is often called speculation because it involves speculating on an uncertain future outcome. Gambling, in other words…
Amateur trader always desperately seeking what will happen tomorrow or next week. This is why most amateurs lose…they think they can control the future and, as such, do not control their losses and maximise their profits… Professional traders simply employ good trade management strategies that let markets unfold naturally and make the most of what the market gives them.
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Many smart traders have given their predictions on when the market will bottom. Although I am not smart, I have also given my fair share since STI was 2,200 and the forecast has been a moving target. Now that 1,473 is in the radar, I am really tempted to call it a bottom. But the market won't listen to me. So maybe it is better to just sit back and let the market unfold itself. The good news is, I learned a lot during this bull/bear cycle. I did also manage to acquire & back tested a few trading setups during this period. Unfortunately, these setups are not suitable for the current corrective wave. I am pretty sure the experience I have gained and the trading setups I have learnt will benefit me once the market returns to normal.
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For now, I just have to execute calmly the average down mission of some S-chips I still hold since party time. Although I know average down is not what a trader should do, this is the price I must pay for failing to cut loss ( lesson learnt ). The values have fallen by 10 times ( not 10% ). It is silly not to average down at dirt cheap prices.
Labels: Trading Digest
World Markets Resumed Slide
While Singapore & Malaysia markets are closed for Deepavali holiday. World markets resumed their slide Monday, with Japan's Nikkei stock index fell 6.4% to a 26-year low ( lowest since Oct 1982 ), as government rescue measures failed to ease fears of a prolonged global recession. A surge in the yen illustrated investors' nervousness about how much economic activity could slow. HSI dived 12.7% or 1,602.5 points ( biggest single-session drop since 1991, lowest since 2004 ) to 11,015.8.
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.US future is very red as of the time this post was made. Depending on the closing of Dow tonight ( it may open nosedive but pare loss at closing, or it may simply close awfully ).... my hope that Deepavali will save STI may still happen if US don't close too badly and if Asian markets rebound tomorrow ! As stated, STI was sitting at the channel support. But it can go either way, ie: reverse from the support or break the support.
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Buying Opportunity:
KepCorp: $2.75 ( based on Elliot Wave projection )
Capitaland : $1.75 ( based on Elliot Wave projection )
OCBC : $ 4.10 ( March 10, 2003 low )
CityDev : $4.95 ( June , 2004 low )
DBS : $ 8.7 ( March 17, 2003 low )
Labels: Trading Digest
Another Week Of Jittery!
Market Digest ( mostly compiled from Yahoo Finance ):
World stock markets tumbled Friday on growing alarm that a global recession will ravage corporate profits and push smaller developing economies to the brink of collapse. In Asia, STI & HSI both fell by 8.3 percent to 1,600.28 ( -145.39 ) & 12,618 respectively. During intra-day, STI breached the 1,600 support briefly touching 1,590. The index was supported by the psychology level of 1,600 at closing.
Wall Street joined world stock markets in a precipitous plunge, with the Dow dropped 312.3 points or 3.59% to close at 8,378.95. The growing belief that the world will suffer a punishing economic recession has investors furiously dumping stocks.
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Market View:
With its closing on Friday, STI is sitting at a channel support. There is a fairly good chance where a technical rebound will take place in the coming weeks taking the index up to test channel resistance at 1,815. I suspect the Deepavali holiday we have on Monday will save STI from further downside other markets may experience on Monday ( if any ).
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.The EW chart below was generated by a trading software. It suggests that we have completed wave 5 of a higher degree Wave 3. This suggestion is quite scary because it implies we have not even completed Corrective Wave A yet. Wave A will be formed only when we complete Wave 4 & 5 of the higher degree wave count currently in Wave 3. After wave A, we still have Wave B & C. This doesn't make sense to me because if this is true STI will be near zero when we reach end of Wave C. So human judgement must come in ! I have manually added my preferred wave count labeled A, B, C in the chart. My target for market bottom is still 1,530 or ( worst case, unlikely ) 1,390 based on the previous EW chart. Other than the higher degree count, I have no problem with the lower degree count. They tally with my manual chart below.
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Labels: Trading Digest
STI Direction
Take this chart with a pinch of salt but this is how I interpret it. I know all three charts I have posted recently all look alike. But that's it, this is because individual stocks are tracking so closely with the indices. They can't look differently anyway.
.Is this how Citigroup derives at their target ( below )? Regardless, I think it is good to preserve some "bullets". If I use them up too early on every dips thinking that "that" is the bottom, by the time it reaches the bottom I will have nothing left. Anyway, even if you really miss the bottom. You can still catch the boat again by entering at Wave 2.
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Updated: 20th October 2008, 1647 hrs
Citi slashes STI forecast
Citigroup has further adjusted its forecast for how low Singapore's key stock benchmark, the Straits Times Index, will go, given the current jittery market sentiment.
The US bank now thinks STI will fall towards 1,500 points by early next year.
This is compared to its previous worst-case prediction of 1,800 points, made earlier this month. Citi said in a research note today it expects negative macro-economic news and earnings disappointments to drag the STI lower as the recession deepens and broadens.
It also notes the bear market during the Asian financial crisis, and the 2001 to 2002 crisis, ended in the middle of the recession. So, since the current bear market is only in its 53rd week, Citi says it is still short of the average 85 weeks seen in previous bear markets with recessions.
As for the property sector, Citi says it's expecting Singapore's commercial, high-end residential markets to head for a hard landing. To tide over the current volatility, Citi says stock market investors should turn to reliable, high-dividend plays - including telcos, media groups and REITs.
Labels: Market Direction
Singapore Property Market Trend
Zaobao yesterday has an article on property market. It says the local property market heeds a cycle where it will top on the year of rat and bottom on the year of tiger. Therefore, they have forecasted the current correction will bottom in 2010 ( year of tiger ).
I added a trend line to the chart to show the support level and added my wave count to explain why the market collapses. Basically, it was a failed Wave 5 based on wave theory and a double top based on classical technical analysis. Of course, this is my hindsight view. But my take for the future is that if the trend line holds, the correction won't be very bad. It will fall till the level of June 2000 which is 140.4 ( -30%? actually quite bad already! ). But if the trend line breaks, it will be awful.
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Labels: Trading Digest
Capitaland Wave Count
Again, no guarantee I am correct. This is just another practise for me. However, if the wave count is correct, we should see Capitaland retrace and bottom at $1.70 ( I am not saying this will happen tomorrow or next week, the target could take quite some time to achieve ).
Labels: Stock Pick
Market / KepCorp
Singapore shares closed to their lowest level in more than four years Friday with selling across the board on fears of a prolonged global recession. The Straits Times Index finished 3.7% or 72.69 points lower at 1878.51. The last time it closed below 1900 was Aug. 20, 2004. The main index has lost almost half of its value since the start of the year.
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The analyst at UOB Kayhian has adjusted their wave count for DJIA. They have reversed their view from bullish on Oct 9 to bearish on Oct 13. "The minimum downside target is 7,329 assuming that wave C approximates 1.62x of wave A. This is close to the Oct 02 low of 7,197. Thus far, the index has declined to a low of 7,895. If the Oct 02 lows fail to hold, then the index could head down to 5,432". Wow, DJIA at 5,432? As scary as it may sound, it is not impossible if you refer to the below ( souce: The New York Times ): .
.KepCorp ( closed : $4.90 )
. This counter has lost 2/3 of its value the past 12 months.
.This is the first time I attempt to look at stock by mean of wave count. Since I am newbie to wave count, I could be wrong.
.Scenario 1:
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. Scenario 2:.
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Scenario 3:.
. Scenario 1 & 2 are basically the same ( except on the way how Wave C is being counted ) and give the same result - optimistic, KepCorp is bottoming soon. Scenario 3 is pessimistic, Wave C is not done yet and may terminate at around $2.75.
I am more incline with Scenario 3 personally! Note that the NAV (net asset value) of KepCorp is $2.98 ( see table above ) so $2.75 is not ridiculous even though the current traded price is $5 or it was $15 one year ago.
Labels: Trading Digest
Sucker Rebound
Dow sank 7.87% or 733.08 points ( closed at 8,577.91 ) Wednesday after US retail sales fell much more than expected and Federal Reserve chairman Ben Bernanke said a recovery from the financial crisis would not happen right away. Renewed panic erupted Asian market Thursday. Singapore shares closed 5.25% lower. The blue-chip Straits Times Index finished 108.19 points lower at 1,951.20, after sinking by 6.63% ( 1,902.28 ) at midday. Year to date, STI has dropped 44%.
The technical rebound on Monday & Tuesday have proven to be a sucker rally. I was wrong to have thought that STI may have scored the low last week. As it turns out, STI has scored "a" low, not "the" low.
Lately, I don't have much TA view to offer. The market has become too volatile ( only god can predict ). Not only has classical TA become hard to keep up, Elliot Wave count has become quite complicated too. Most analysts still believe Dow & STI are at the terminal of C wave. It should have ended ( based on Fibonacci ) or ending soon. However, there is no sign in sight yet. At the rate it goes, the current wave count may be wrong!? Recount may be needed if the market continue to dip.
Until such time I am able to post a meaningful chart, I will focus on documenting the major market events. Some of the information posted here may not seem necessary now as similar news are flooding the papers & Internet. However, as times go by, all the information will fade even from the search engine. It is useful to leave them in the database of this blog for future reference ( for next bear / bull market, just like now we keep taking reference of SARS & 911 ). After all, the primarily goal of this blog is the learn from mistakes ( or past events ) to make us better traders and not so much on predicting the market!
Labels: Trading Digest
Global Stocks Soar
How contrasting are these two posts be over the weekend!
STI soar 128.02 or 6.57% on Monday (10/13), the highest point gain since 1999. Today, it gained another 51.96 points or 2.5% to close at 2,138.31,. Dow rose 936.42 or 11.08% on Monday, the highest ever points gain in history or highest percentage gain since 1933.
This post is intentionally meant to be short as I am exhausted after a day trip to Johor for customers visit! Just wanted to make sure I document some numbers for future reference......
Labels: Trading Digest
Global Stock Markets Meltdown
Global stock markets meltdown into panic-fuelled chaos yesterday, spook by another precipitous sell-off on Wall Street. Global markets lose US$ 6 trillion in panic selling ( By the way, "trillion" consists of 13 digits. One digit more than most calculators could hold ). The latest loss also means the Dow is down 40.3 percent or -5,713 points since reaching a record high close of 14,164.53 a year ago. This week alone ( Oct 6 ~ 10 ), Dow lost 1,874.19 points, or 18.2 percent in 8 straight sessions. At the low point on Friday, the Dow was down 696.68 at 7,882.51, some 600 points above its low in Wall Street's last bear market, 7,286.27, reached Oct. 9, 2002. It crossed the line between gains and losses 32 times during the session. Its close was the lowest since April 25, 2003.
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STI closed down 154.38 points to 1,948.33. Intra-day low was at 1926.26, a loss of 176.45 points.
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Here is how the global markets suffered:
Markets.............Oct 10 loss...This week loss
New York:........... -7.3%..... -16.9% (8,451.19 -128)
Singapore: .........-7.3%.... -15.2% (1,948.33 -154.38)
Hong Kong:....... -7.2%.... -16.3% (14,796.87 -1,146.37)
Kuala Lumpur:... -3.6% .....-8.1% (934.01 -34.88)
Bangkok:............ -9.6%..... -23.4% (451.96 -48.03)
Shanghai:........... -3.6%..... -12.8% (2,000.57 -74.01)
Seoul:................. -4.1%..... -12.6% (1,241.47 -53.42)
Tokyo:................ -9.6%...... -24.3% (8,276.43 -881.06)
Taiwan:.............. -1.5%...... -10.7%
Sydney:.............. -8.3%..... -15.7%
London:.............. -8.5%..... -20.8%
Paris:.................. -9.7%..... -23.8%
Frankfurt:............ -9.8%..... -24.1%
Toronto:............. -1.75%..... -12.7%
Mumbai:............ -7.1%........ -16%
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The heavy sell down this week may have expedited the timeline of market bottom. I like to think that the market has either bottomed ( based on benchmark with the last ten bears & current P/E ratio of 8.13 ) or is very near to the bottom now (150 points more for STI?). However, I don't believe the recovery will be "V" or "U" shapes but more likely to be "L" shape. That means, the market will enter into a consolidation phase with downward bias for quite a while before the bear wear off ( probably one year from now ). This is my non TA personal view.
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The last ten bear markets:
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Mar 19 2002 - Oct 9 2002
Dow lost 31.5% in 204 days
Trigger: Worldcom and Enron
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Jan 14 2000 - Sept 21 2001
Dow lost 29.7% in 616 days
Trigger: Bursting of dot-com bubbles.
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Jun 17 1998 - Aug 31 1998
Dow lost 19.3% in 45 days
Trigger: Collapse of LTCM
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Jun 17 1990 - Oct 11 1990
Dow lost 21.2% and lasted 86 days
Trigger: Invasion of Kuwait
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Aug 25 1987 - Oct 19 1987
Dow lost 36.1% in 55 days
Trigger: Currency valuations debate between US and Germany
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Nov 29 1983 - July 24 19874
Dow lost 15.6% in 238 days
Trigger: Inflation fear.
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Apr 27 1981 - Aug 12 1982
Dow lost 24.1% in 472 days
Trigger: Excessive interest rates
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Sept 8 1978 - Apr 21 1980
Dow lost 26.9% in 591 days
Trigger: Stagflation
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Sept 21 1976 - Feb 28 1978
Dow lost 26.9% in 525 days
Trigger: Stagflation again
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Jan 11 1973 - Dec 6 1974
Dow lost 45.1% in 694 days
Trigger: Watergate scandal and Arab-Israel war.
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Technical rebound should take place next week since the markets are grossly oversold. If this rebound is what UOB Kayhian referred to as the onset of Wave 5 then it should take the index up by a few hundred points. If this happens, my "L" shape theory will be invalidated. Instead, this will give a "W" shape recovery where we are currently at the bottom left of the "W".
Labels: Trading Digest
Intra-Day News
Singapore Economy In RecessionSingapore's trade-sensitive economy has declined for a second straight quarter, the government said Friday, meaning the city-state has entered a recession for the first time in six years.
On a seasonally adjusted quarter-on-quarter annualised basis, real GDP declined by 6.3 percent in the third quarter after contracting 5.7 percent in the previous quarter, estimates from the Ministry of Trade and Industry said.
It did not describe the economy as being in recession, but a technical recession is generally defined as two consecutive quarters of quarter-on-quarter contractions in economic output. Economists polled by Dow Jones Newswires had forecast a 0.3 percent quarter-on-quarter rise in gross domestic product (GDP), the value of goods and services produced in the economy. Singapore's last technical recession occurred in 2002, and the most recent full-scale recession was in 2001 when the economy contracted 2.4 percent during the year.
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DJ MARKET TALK: Cosco Off 13.9%; Charter Rates At Risk - DBSV
0209 GMT [Dow Jones] Cosco (F83.SG) biggest percentage decliner on STI, down 13.9% at S$1.12, as broad market selloff adds concerns over fall in BDI, news of client MPF filing for bankruptcy (STI down 6.8%). MPF ordered vessel for US$120 million in September 2006, paid Cosco most of it, but sharp share price fall in recent days suggests investors not taking any chances. DBS Vickers says Cosco may also be hit by fall of up to 30% in charter rates; "although most of Cosco's vessels are lockup for one-year contracts, a few vessels are due for renewal end of this year, which will likely to see sharp decline in charter rates." Support expected at S$1.00, last reached in 2004. (FKH)
Mimosa: I was looking at Cosco few days ago when it was doing at $1.3x. I am glad I didn't manage to get it at $1.35. With the development of Ferro-China, I don't think I have confident on S-Chip anymore. What's worst is that being a shipping company, Cosco is subjected to the swing in BDI. It looks like Cosco will become penny stock soon!
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FerroChina: On the brink of bankruptcy
FerroChina Limited: Suspending coverage on cash flow issues.Summary: FerroChina has announced that it has a total of about RMB5,229mworth of loans and notes that are due and payable at various stages. It hasannounced that it is in active negotiations with financial lenders toaddress its repayment obligations but have not given assurance of suchsuccess. For now, FerroChina is deemed to be technically insolvent. Citingthe “economic crisis” as a cause, we anticipate that possible reasons couldbe 1) Customers not being able to pay up and; 2) Disproportionate slow downin sales with cooling demand in the market segments that it is in. In abest case scenario, FerroChina will secure its refinancing, bring on boardits strategic investor and continue with operations. In a worst casescenario, an anticipated “white knight” rescue scenario with a 40% or 50%discount on its NTA will value FerroChina at about S$0.46 or S$0.39respectively. In view of the suspension of trading of its shares on SGX andceased operations in China, we are also suspending coverage until we obtainbetter clarity of the situation.
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Dow Plunges 679 points To Fall To Lowest Level In 5 Years
A year after soaring to record high, stock market plunges into pit of despair. It almost seems inconceivable now as both Wall Street and Main Street stare into a seemingly bottomless pit of despair that has swallowed up $8.3 trillion in shareholder wealth during the past 366 days.
Dow Jones industrial average down 679 points more than 7 percent to its lowest level in five years. Stocks took a nosedive after a major credit-rating agency said it might cut its rating on General Motors and Ford, further rattling investors already fretting over the impact of tight credit on the economy.The Dow has lost 5,585 points, or 39.4 percent, since closing at 14,164.53 on Oct. 9, 2007. It's the worst run for the Dow since the nearly two-year bear market that ended in December 1974 when the Dow lost 45 percent. U.S. stock market paper losses totaled $872 billion Thursday and the value of shares over all has tumbled a stunning $8.33 trillion since last year's high. That's based on figures measured by the Dow Jones Wilshire 5000 Composite Index, which tracks 5,000 U.S.-based companies' stocks and represents almost all stocks traded in America.
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One Year Anniversary Of Bear MarketLabels: Market News
Elliot Wave Or Idiot Wave?
Concerted effort from central banks around the world to cut rate failed to stem bleed from the stock market. Dow loss another 189 points last night ( 6th straight declining sessions in a row ) to close at 9,258, down by about 35 percent from its high of 14,164.53 reached exactly one year ago. Asian market rebounded today. STI recovered 3.4% or 69.1% to close at 2,102.71.
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Analyst at UOB Kayhian maintained that the terminal low of Elliot Wave 3C is either in place or is forming over the next 1 ~ 2 days. If this is valid, we can look forward for a significant / sustained rebound. We are not talking about a single session of rebound by 60 points like what we have today. We are talking about "Wave 5" which should last for weeks or months. I have no idea on the target of Wave 5 or its duration but this will be the last leg for this 5 big impulsive waves cycle before the next big correction of A,B,C wave set in. I am not sure whether I am right or wrong. But I think Wave 5 will help us to recover quite a bit of loss ground before the terminal of 5C bring us down to 1,800 which will form the bottom of this bear market ( by 2009 ). Again, I am only guessing. There is no concrete basis to back my wild guess.
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Mr Oei Hong Leong, touted by the media as Singapore's own Warren Buffet for his savvy investment decisions, has this to advise :"When you see the situation is like today, it's better to cut your losses, rather than go to the average. It's a mistake to go average. I think the thing can go much worse -- you're going to have 5 trillion assets be leveraged. Now the bank-to-bank, they don't trust each other. How can they trust you as an individual? 700 billion is far from enough to bail out but I think the most important thing is they have to restore confidence.". 14th months ago ( Aug '07 ) when STI was climbing toward 3,900. Mr Oei predicted STI will drop to 2,500 or lower. So the advice from this man should not be taken lightly.
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With the volatility of today's market. Traditional technical analysis ( support & resistance, trend line, chart patterns, candlesticks, indicators...etc ) can no longer keep up due to its lagging nature. The only way to battle the market is through wave study. Unfortunately, Elliot Wave is easy to learn but difficult to apply. This is especially true when come to Corrective Wave. Even for the experts, they often make mistake and end up have to recount. This is an effective tool but extremely hard to master. You either love it or hate it. Therefore, it is either Elliot Wave or Idiot Wave.
Labels: Trading Digest
Elliot Wave Course
The 4 x 3-hour sessions of Elliot Wave course at SGX started tonight. The lecturer is Mr Wang Tao, Associate Director of UBS and President of Technical Analysis Society of Singapore (TASS). I like his opening remark! TA enables us to see one tree inside the jungle, Elliot Wave enables us to see the entire jungle.
Based on Mr Wang's Elliot Wave count, STI is currently at Corrective Wave C of Motive Wave 3 ( or 3C ). Wave C should terminate at 2,105. What happen next after Wave C? At the end of the Corrective Wave C marks Wave 4. STI will rally into Wave 5 with a target higher than 3,900. Wow, in other word, he is advocating that STI will bottom within the next 60 points! This is quite different from what I think !! I beg to differ and still think that the bear is not done yet.
Mr Wang confessed this: During 911, he was bearish about the market. During SARS, he was bullish about the market. Now, he is loss! This is not an easy market to be in even for expert like him. No wonder I have been wondering is my TA skill deteriorating or is it just that the market is too difficult ! I think it must be the latter.
Anyway, regardless of whether you base on Mr Wang's wave count, which tally with UOB Kayhian's wave count, or the 2,170 support. The general consensus is a strong rebound is on the cards.
Labels: Trading Digest
Bailout Not A Panacea
The US Congress has finally approved the historic US$700B government bailout plan on Friday ( October 3, 2008 ) reversing its earlier decision on Monday that has caused the Dow to tailspin by 777 points. However, the approval did little to lift stock. Dow closed 157 points lower on Friday. For the week, Dow lost 818 points.
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On the chart, Dow is near a channel support. If it survives 10,180, it has a chance to bounce up from the channel till it meets channel resistance at 12,000. As far as STI is concerned, I saw a chart from another blog which I think make sense. It was a 10 years chart that show an important support at 2,170. If STI is able to survive this level, we may see a strong rebound from here.
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The $700 billion rescue bill that Congress finally passed will limit panic ( volatility ) in the markets, since it gives the government vast new authority to take over sclerotic securities that have clogged the credit system and already brought down some of America's biggest companies. With the feds stepping into the bloodbath, the hemorrhaging should stop. But the economy is still in precarious shape, and unrealistic expectations about the bailout could end up disappointing consumers hoping for some kind of immediate relief ( paragraph extracted from Yahoo Finance ).
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Come Friday, October 10, it will be the one year anniversary of the onset of bear market. However, the news about Singapore heading for a technical recession and that the property market has ended the four years boom surfaced only now. So the economy is one year lagging behind the stock market. I believe we are at best mid-way from the stock market bottom. I hope next year by this time, we are able to see light at the end of the tunnel. By 2010, the world is able to walk out of the gloomy economy.
Labels: Market Direction
Talk To Mimosa
mimosa_view @ yahoo dot com dot sg
Biggest Single Day Plunge In Dow History
US House of Representatives shocked the world on Monday Sept 29 ( US date ) rejected the US$ 700B bailout plan sending Dow for a free fall by 777 points, the biggest point loss in 102-year history surpassing the 684 points drop on Sept 11, 2001. At the opening bell on Tuesday Sept 30, STI plunged by nearly 122 points but managed to claw back to finish at -2.43 points loss.
The volatility of Dow has worsen lately. Not only has the rise & fall are triple digits, the swing magnitude has widened to 400+, 500+ to 700+:
Sept 15.... -504.48
Sept 16..... +148.51
Sept 17..... -449.36
Sept 18..... +410.03
Sept 22 .....-372.35
Sept 29 .....-777.68
Sept 30.... +485.21
All of the support levels for STI I have identified on the way down since 3,200 have now been violated including the last defense at 2,280 which I thought will take a while to reach and may hold on well. I have now adjusted my worst case scenario to 1,800 which is quite near to the D-triangle target of 1,625.
Capitaland dipped to an intra-day low of $2.66 on Tuesday ( -70 cents from previous day close, the biggest single day drop in more than 10 years ). I thought it was a good value and queued for some at $2.74 after it has rebounded from intra-day low ( I entered my buy queue when the last done was $2.8+ ) but my buy order was not done as it climbed back to $3.06. I was too slow ( too busy ) due to having visitors in town, sigh !!
Now that all of the prominent supports have broken. It is kind of difficult to determine the next support level ( I only have three years market data anyway ). I guess the only way to look at where the index will be heading is by mean of Elliot Wave count. Something which I have not mastered yet but will be attending the course at SGX commencing next week.
Labels: Trading Digest
Capitaland - Updated Chart
Labels: Trading Digest
