Monday, February 05, 2007

STI preparing for CNY rally?

Was surprised that STI held steady today, given a negative close from US last Friday. In fact, throughout the morning, it even increased up to 30 points upwards, but later drop to the present level of +5.64.

A stream of good news must be the reason why this bull refuses to come down. Firstly, there is the budget day 15th Feb (if I'm not wrong). The key thing to note here is the corporate tax cut by a minimum of 1%. I think that if corporate tax is cut by more than 1%, that's it...we'll have another round of bull charging through the new year. Another good news is the general good sentiment around chinese new year. Basically it's a self fulfilling prophesy. If everybody think there's a CNY rally, then starts buying in advance, there will really be a rally. Lastly, is the fact that US side seems pretty strong, with dow jones recently bouncing back from support level. One very interesting thing here is that my sti puts refuse to go down anymore lower than 0.030. You can guess what's people doing already...they are preparing for the correction some time after CNY. So we should get ready for it too.

I'm still holding my hsi call warrant since last fri. Went up a bit, dropped a bit. Generally I'm still bullish about hsi. I hope tmr it will cheong up so that the stubborn stochastics can really turn around with the red line crossing over the blue. I checked the MACD too and it seems like the classic 4 red lines and 1 green histogram chart from chartnexus program. The slope of the MACD is trending downwards, but it shouldn't be a problem as long as the reversal starts this few days. I expect mid week we should be able to see a convincing breakthrough of 20,600 level. That should be more reasons for the bulls to buy up HSI.

Osim looks pretty bad. Dropped to 0.975 today on high volumes (roughly 3 times of 50 days averaged vol). RSI trending downwards still, and still no signs of reversing its downtrend. Stochastics downtrend too. MACD also shows more downside as the red histogram didn't show signs of slowing down.

There's a weak support found at 0.96 so there might be an entry point to average down for osim. I would buy in small amounts near 0.96, if it breaks supports, then go lower to buy at a stronger support at 0.875. But I don't foresee osim to keep dropping till 0.875. There might be a technical rebound to levels between 1.08 to 1.24. So after averaging down, I would sell at the rebound then wait for another time to re-enter. Basically weekly charts shows more downside..that means more downside for weeks to come, with intermediate rebounds here and there.

Price action:
I would no longer follow japanland, SeeHS. Not interesting anymore.

MAE enggr rose to 0.23 today. Probably have to do with the impending crash of the metals market. Some hedge funds dumping their commodities, I heard. This affected some companies dealing with raw materials.

Longcheer today rose up 0.02 cents, wonderful! With this 2 consecutive days of rising, loncheer charts look very good. MACD starts to turn up from downtrend, stochastics already turned up. Ema 20 bounced off ema50 days, with stock price cutting both lines upwards. Results out on this thurs (don't know if it's after trading hours or before or during lunch time), so I hope to see more people accumulating longcheer. Results should be good given that dec quarter results in more people buying electronic gadgets.

Dow -9 points now, let's see if it closes that way.