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!