technical analysis for this week

wow the week has passed in such a short amount of time. and it is finally time for the euro 2008 finals. sadly, i'm not your punter so i won't be talking about odds, but let's assess my two favourite stocks and see how they would perform this coming week.

currently as it is, share prices for SGX closed in at 6.92, 0.08 below my defined support at 7.00. the week's session saw a general decline as volume of trading remains relatively low. as a result, the stock hasn't been very volatile in the current down market, but the positive thing about that is that the direction is certain, and so far it has been a clear downtrend for weeks.

as it stands, conditions for SGX are similar this week as it is to last week, however, the support at 7.00 may require a little bit of testing. RSI showing a negative momentum, and coupled with stochastics crawling in the oversold regions, seem to indicate a further downtrend in the next week or two. however, a couple of scenarios may likely emerge. firstly, monday's session may see an upside gap back above support levels (if 7.00 seem to prove to be quite a support) and that the trading session for the day would end in the red. secondly, the downtrend would most likely continue and keep heading down, down and down.

my verdict: if prices open up above 6.92 on monday, watch for price actions and get a sense of where the market stands with the stock. if there's a huge selling pressure, then by all means go long on your puts or short the stock. for those not really apt with market sentiments, a close below 6.92, or even below 7.00 may give the same signal. and well if there's a huge selling pressure and the market opened lower than 6.92, what are you waiting for?

as for Capitaland, the situation remains similar to that of last week's trade. for those with an eye for charts, currently, the share prices are at the consolidation phase, and there's a slight positive divergence that can be seen from the past 2 weeks. i emphasise, very slight. i can't really tell whether it'll prove to be any form of reversal signal, but my best guess is a definite NO.

as what was quoted last week, the stock didn't have enough downward momentum to carry it lower to the 5.50 levels. however, now it becomes even clearer to me because of the consolidation phase it is currently in. if so, the next week may see a continuation, mainly because stochastics are pointing down and RSI isn't really pointing very much upwards. it is somewhat likely that prices may fluctuate upwards, up to the 5.70 levels, however, a breakout would be needed and that would come from a lower open on monday. and in my honest opinion, the only way for the prices is down.

my verdict: a lower open would signal a breakout, and a close in the red, a confirmation. need i say more? go long on puts, or short the stock.

that's all folks, and well all i can tell you is that it is possible to make money from both of these stocks now. hope you guys make lots this week to come.

happy trading!

money money money

money makes the world go round. and round, and round and round. money goes around the world too, at exceptionally high speeds that we, as consumers, simply love to ignore.

in a recent article on business times, it was quoted that there was about 77,000 high net worth (HNW) citizens in singapore. high net worth would mean that he or she has at least S$1,000,000 (that's one million for those who are bad with numbers) in liquid assets. liquid assets would generally mean basic cash in savings account, or even holding in equities, bonds and other financial instruments. wow. amazing isn't it.

then we look even further back in time and we can see how inflation rates within the country skyrocketed, reaching as high as 7.5%. and currently, the rates doesn't seem to be heading lower.

as compared to our regional neighbours, we have to thank the strength of our singapore dollar against others. despite such trying times, our currency value remains strong and there wasn't a very significant tumble.

with such major problems bogging us from all around us, how can we afford to spend so much and have so little? then it that case should we save too much and spend too little? how do we preserve the value of our money?

so let us talk about savings. now any tom, dick and harry should be familiar with how the bank works. put money with them and the money will grow. wow, grow, but by how much? now any tom, dick and harry won't realise that interest rates being paid out by banks are pathetic in combating the inflation. at an interest rate of 0.25%, you are below inflation by 7.25%! wait hang on, what is inflation?

lets look at it this way, just to put it simply. say you have one dollar today, and inflation rates are at 10%. say you tell yourself that you are going to put this dollar and bury it in your flower pot for a year, hoping a money tree will come out. then a year later, you take our the coin, but instead of a money tree, you have deposits of rust on the coin. bravo.

then, you take your dollar coin to the provision shop downstairs and you think that you might want to have a bottled soft drink since you have been hibernating for a whole year, together with your dollar. so you asked the store owner "hello uncle, this bottle of 100Plus costs one dollar right?" however, to your horror, the owner gives you an icy glare and says "ONE DOLLAR TEN CENTS!" and with that you go "WHAT THE FUDGE?!"

the above scenario, though may be somewhat inaccurate, shows the effects of inflation. as the value of money drops due to inflation, the dollar in the future may only cost 90 cents today. and to keep pace with inflation, prices of everyday things go up.

now what? how can we ensure our money don't grow mushrooms, but instead, grow more money. the answer is simple, but yet most people choose not to even give it a thought because they feel that the future is risky and uncertain. (well even any brain dead guy on the street knows that so what makes you think you are special?)

investment opportunities gives you the ability to keep pace with inflation, and at the same time, grow your money. the earlier you invest, the more money you will have in the future. this is simple math: compounding interest. a sound investment allows for a person to effectively grow his money over long periods of time, and hence when the future arrives at his or her doorsteps, he or she will have much more than what was being put in. a theoretical figure would be an investment of $4,000 per annum at a return rate of 7%-8% annually. in about 40 years, say when you retire, you'd probably be joining the high net worth people.

however, with returns comes risks as well. the thought of risk put many people off, because most of us live in fantasy-land where we think low risk can generate high returns. boys and girls, time to wake up ok? the risks involved in investments can be properly managed, and minimised through various means. hence, an investment portfolio usually has risk management systems to allow for investors to sleep with a sound mind and a clean smelling pillow at night.

at such times, the banks, are just like a safe box. spiders live in safe boxes. so start your investments early. for more information regarding investment opportunities, strategies and products, my msn channels are open.

technical analysis for this week

since i'm still currently being bogged down by tonnes of work and studies, i can't seem to find time to trade as of yet. but rest assure, i'll continue during the next week if the market permits, and at the same time, share my trading strategies as well as my profits and losses.

this time round, i'll give a more comprehensive analysis on the two stocks i'm watching. first up would be SGX.

from today's close, the share prices were at 7.19, down 0.96% from the day's open to close off in the red. for the past month, the stock has been trading below its 10, 20 and 50 day EMA, sparking a continuous downward movement since then. between the period of april 20 to may 20, a head and shoulders formation was seen, where the last shoulder triggered the downwards spiral from then on. a clear support can be seen at the 8.00 mark, where the share prices consolidated before the drop in the RSI triggered the breakout in support levels. the same can almost be said for the 7.50 support, where a short term consolidation was proceeded with another loss in momentum to carry the share price further downhill.

looking now at stochastic readings, both fast and slow stochastics a looming down on the oversold levels, and RSI readings shows a cutting below the 20% mark. can't really pick out much from MACD readings, just that it still remains below the signal line and would most likely remain so.

outlook for this week would be again, negative. 7.00 didn't seem to prove to be much of a strong support in the past, but this week may see a testing of the support. since the price is currently about 2% above the support, i won't advise going long for puts as of yet. for those who loves risks, you may consider going for a higher leverage on your instruments, or warrants, which has a high gearing and low conversion ratio.

now let us take a look at one heck of a volatile stock, and one of my favourites, Capitaland.

from today's close, the share prices were at 5.81, down 4.44% from the day's open to close off in the red. for the past month or so, the stock has been trading below its 10, 20 and 50 day EMA, sparking a continuous downward movement since then. between the period of april to early may, a triple top formation was seen, where the last spike triggered the downwards spiral from then on. last friday saw a huge upward spike in the share price, not sure what it reacted to but it was the much needed retracement for the continuation of the downward trend.

looking now at stochastic readings, both fast and slow stochastics a remains noisy in the oversold region, and RSI readings shows a downward movement, probably heading for the 20% mark. can't really pick out much from MACD readings, just that it still remains below the signal line and would most likely remain so. the spike in the stochastics is my much needed indication of a downward continuation. the stochastics react very quickly to price fluctuations, however, RSI still shows a downward movement. this would indicate that the stock doesn't have the momentum for recover, but the spike in the stochastics is actually giving the stock prices a further downward push for the week.

my verdict on this: very good! gong long on puts would definitely help during the week, as a further movement to the 5.60 mark and below is highly likely. now is the perfect time to go long on your put warrants, hopefully you'll make some money this week. i believe that the share price may retreat to levels of about 5.40 to 5.50, a good 10% drop or so from today's price.

Have a good trade week ahead guys, and hopefully you could make some profits on Capitaland.

quick update on stocks

ok before i got off for a 3-day retreat out in no man's land, i'll get going with an updated on my 2 favourite stocks.

SGX closed off this week in the red and has a consistent downtrend for the past 2 weeks. nothing much can be said at the point of time, but the only thing that can be said is that it is a good time to put the puts into action. follow the trend until it faces a reversal. currently, a near term reversal seems unlikely, and this coming week will be downward trending.

my best guess would be that by the end of this coming trade week, the prices may close near the 7.00 mark. investor strength is weak and confidence doesn't seem to be at a high. my call: long over puts, or go short over mother share (for risk loving junkies).

now with Capitaland, the same applies. nothing much can be said. however, a close below 5.80 may signal a further downtrend to come for the week. and from what we've seen so far, a near term reversal may not be coming in pretty soon. so we shall just follow the downtrend and ride it till it runs out of steam.

the trade week may see the prices drop down to the 5.50 mark, or below. my call: long over puts or short over mother share (again, for risk loving junkies).

i just want to clear the air of mystery over short-selling. the main reason why people are so averse to the idea of shorting stocks is because of the relatively short cover period as deemed by SGX. usually, the position must be covered by the end of the day, and if not covered within 3 working days, SGX will cover your position at 2 ticks higher. however, shorting is nothing but the reverse of any long position for an intra-day traders. i guess we as singaporeans are still risk averse and finds the idea of shorting a taboo. personally, i've made money from all my short positions.

anyways, cheers and have a good trade week!

a story of dreams

dear. a house at the crest of the field. on the horizon are hills that rolls over an eternity. the gray clouds hang low on the sky's edge, cascading down a blanket of fog that seems to devour the curvy landscape.

the skies are gray, and tiny drops of rain strikes mother earth with a gentle touch. it is as though the heavens are crying, not because of sorrow but because of an overwhelming sense of joy. the pitter patter of the droplets keep in tune with our beating hearts, now, they beat as one.

loving each other's embrace we gazed deeply into each other's eyes. we forget. yes we left behind all that was attached, our families, our friends, and our lives. we started fresh, fresh from the day we ran away from the world. the world that shackled us and plays poker on our very existence. he seemed to be winning all the time, but now, he is at our mercy.

a house, and a life together, a dream that seems to always whisper in my ears and cast faint shadows that i can barely make out. a dream that was once a wish. but a wish that still is, a wish.

an excerpt from "a story of dreams" by ms demon in exit

technical analysis for week 02/06 to 06/06

back again with some analysis of the stocks of SGX and Capitaland this week. as always, let's begin with the stock that helped me made money from my first ever trade.

the market week began, well not surprisingly, with a very low trade volume. SGX began the week with a very weak start. throughout the week, the share price closed very near its strong resistance of 8.00. consolidation is definitely occurring here as the prices have no general direction and prefers to hover around the support levels. with a very weak market activity as ween with the relatively low volume of trading occurring this week, it is no surprise that the prices remain stagnant at the end of each day.

currently, analysis of the indicators doesn't prove to be of much use as there are no clear long or short signals. with almost a flat line this week, the trend for next week is as smoky as my camp's smoking corner. then again, no point predicting trends.

Capitaland did just what i had expected due to its lower open on monday, and that is retreating back to its strong support of 6.20. this is a rather strong support level . even when trading volume remained low, prices are still rebounding off this support level. again, the retreat to support was interrupted by a spike in price on thursday.

technical geeks may want to consider a possibility of a rectangle formation. if volume remains low throughout the trading range of 6.20 and 6.50, a spike in volume might result in the eventual breakout of the support. however, this is purely speculative and the trend should be monitored for another week or two. day traders for highly geared Capitaland warrants are still happy due to the volatility of this stock.

well, nothing much to say at least for the week. its 3 weeks since my last trade and i can't wait to get back in the hot seat.

PS: for those who are keen in investment opportunities, avoid the equity market for the time being due to the stagnant market and high inflation rates. speculation on equities via technical analysis is very risky and not for the risk adverse. for help on investment advice, feel free to approach a me or any trading representative.

outlook of this week's trade

both SGX and Capitaland didn't put up much of a show today, closing lower than the previous close. Capitaland dipped 3.1% to close at 6.35 while SGX dipped 0.2% to close at 8.02.

for Capitaland, 6.50 may prove to be quite a resistance that needs a great deal of strength just to sustain a breakout. the close up on last friday didn't have enough steam to carry the prices up, hence a fall of 3.1% is seen today. currently, there are no possible trend that can be seen except for a high chance of a retreat to support at 6.20, or a consolidation phase between 6.50 and 6.20.

SGX on the other hand seems to be very weak nowadays, with price difference between previous close and the days close not being too far apart. this is kind of rare to be seen from a somewhat volatile stock in my opinion. currently at the 8.02 levels, i feel that it would still linger around the 8.00 support levels. a breaking of support at this level would indicate further downside for the stock, however, nothing much can be said about how the prices may move in the weeks to come. traders who strongly believe that 8.00 is where strong support comes in may choose to buy, however, there are no signs of any upward trend at the moment.

and yet, i would say another bleak weak for the stocks today. i was thankful i didnt go long for Capitaland as my senses told me to hang on and read the telltale signs from today's close.

oh let it be when the upward trend comes, a gold bar would drop on my head, crude oil would gush out of my toilet when i press flush, and grains of rice starts pouring out of my shower head.

trust

we are all born as skeptics. as to how much skepticism we have in us, it varies. some of us tend to trust strangers better than others. i've learnt to be less of a skeptic, not that being skeptical isn't good, but at times, it can be damaging.

true, there are unscrupulous people out there out to trick you of your money. but some people are out there, just doing your job, probably needing your help in return. sometimes, we have to lower our heads, swallow our pride and trust these people.

trust isn't an easy thing, especially for those people who got their fingers burnt before. but that doesn't stop you from trusting.

sometimes a little risk in our lives is a good thing. risks let us step outside of our comfort zone to explore ourselves deep within. being skeptical is being overly risk adverse. asking dumb questions like "will i get paid doing this?" or "will he cheat me out of my money?" or maybe "what do i get out of this?".

i don't know. honestly, i'm a risk loving person, because i can assess risk very quickly. but for those who are afraid and continues to be skeptics in their own world, please buck up, and don't fuck yourselves up.