Singapore stock market direction 10 june 08
Cannot see the future but the past is a good indication
After seeing the Singapore stock market as well as other Asian stock markets staging a mini melt down over the past few days, some of my friends have asked me to share my thoughts about the Singapore stock market.
For starters, I do not usually look at blue chips or big caps. My favourites are S-chips or Singapore listed companies with operations mainly in china. I also prefer to look at stocks with good trading volume and range between S$0.20 to S$2.00.
Oh, I almost forgot to mention that I usually combine both fundamental and technical analysis when I analyze stocks. Over the past ten years, I must admit I have developed the habit of analyzing stocks whenever I have time…..it has become a past time hobby of mine so please take note that I do not always have to have a position (either long or short, buy or sell) because I do enjoy the analyzing part. Some people like playing golf or PS3 but I prefer looking at stock charts on Metastock when I am free. And as strange as it may sound, when I do not have a position but still analyze stocks, sometimes I think I can see things clearer since my emotions are not affected.
Now this is what I have to say about the current singapore share market situation, and the following are purely my personal observations which you may or may not agree.
The Singapore stocks market seems like behaving in the same pattern as before.
I have expected this since seeing the behavior in the past few quarters, that selling momentum returns once the results season is over. Typically during downward or weak sentiment market, many stocks that I monitor have been sold down once results or earnings season is over and only starts to recover about one month before the next results season begin…..this was clearly the case last time round. So when the results or earnings season concluded on 15 May, I started to warn some friends that selling pressure may yet return again……unfortunately to those who have long positions, I have been right this time.
For those who have little or no position, the golden question is when does one think the market may stage a rebound? I expect the market to remain choppy just like last time when results season was over, with the bias towards the downside and a reprieve or rebound will only come about 2-4 weeks before the next earnings season begin!
With that in mind, I will eagerly look forward to 2Q08 or end June quarterly results seasons which is expected to start end July. So if you work backwards 2-4 weeks before the last day of results reporting ie 15 August,…..that means the earliest the market is likely to stage a stronger rebound may be mid July. But sometimes, the timing may be off by 1-2 weeks so I will start to monitor closely again around end June.
That does not mean that market will be one way traffic down all the way until mid July, it just may remain choppy up sometimes, down sometimes, rangebound, until a base is formed to stage a stronger rebound.
As for technical analysis indicators, one indicator I like is CCI.
Right now, CCI for a few hot stocks that I monitor like Ferrochina and China hongxing have created lower low while in negative zone. Now being in negative zone is not good to begin with but to create lower low means double whammy and not likely to see any strong rebound in the near term. I would get excited again once I see CCI indicator forming a nice base for several hot stocks.
Hope that you enjoy my talkstock session………
rooney
Post a Comment