Global Market Outlook For Week Beginning 26th October 2009
The 2700 resistance level has FINALLY been broken after as many as 5 attempts for STI. The magic number now is 2746. A successful breaching of 2746 will fuel STI with the necessary momentum to charge towards the 3000 mark before the close of 2009.
Shanghai Stock Exchange (SSE) seems to have broken out from the consolidation range of between 2600 and 3000. Based on the upside target projection, the next resistance will be around the early August high of 3478.
Coupled with the upward momentum of SSE, Hang Seng Index (HSI) charged through the high of 21,930 attained on 17thSept 2009 impressively. Going forwards, HSI should have enough strength to trend up towards the next ceiling of 23,300.
Kuala Lumpur Composite Index (KLCI) has rallied 52% from the low of 838 since early March this year. The next 2 resistance levels will be at 1276 and 1305 respectively. The immediate support for KLCI is at the 1241 level.
Jakarta Composite Index (JCI) has experienced a tremendous run-up of 106% since the low of 1244 attained in early March this year, making it one of the best performing market in Asia together with SSE and HSI!! The next ceiling for JCI will be much higher at 2774, provided that it can bulldozed through the high of 2559 achieved on 7th October 2009. It may retreat to the 2411 level if it were to experience any weakness or profit-taking.
In U.S., S&P 500 has been trading within a tight range after breaching the 1080 resistance level. Its immediate support will be at 1039 if it fails to trend higher. However, it may have a chance to touch 1168 if it can gather enough strength to rally from the current trading range.
NASDAQ has a half-hearted penetration of the 2167 level, after which it has been tiptoeing around this level for the past fortnights. It’s next resistance level will be at 2319 while 2040 will be its immediate support.
Dow Jones has been flirting with the magicial 10,000 level for the last 2 weeks as well. It may retreat to the 9630 support level. Technically, it has the potential to hit 10,642 if it can pull away from the 10,000 level successfully.
Personally, I am not particularly worried that the stock markets will have a drastic decline before we draw the curtain for 2009. I believe the party can still carry on because of the aggressive stimulus plans, bailouts, low global interest rates…etc. So let’s all enjoy the music, wine and food while the party is still on, but with the caution that we may have a significant correction next year at the back of our mind. If you guys think that this ugly Great Recession is already over, I urge you to think again seriously………
Cheers 
Disclaimer: Please be informed that the above mentioned stocks/indexes/investment instruments are solely for the purpose of education; it is NOT a recommendation or an invitation to trade/invest. For trading/investment advice, please speak to your remisier, dealer representative or financial adviser. Please understand that there is risk in every trade/investment venture, know your risk first before you venture into any of them.
Global Market Outlook For Week Beginning 12th October 2009
2700 really proves to be a very tough resistance level for STI to crack, it has till now altogether tried 4 times unsuccessfully! It maybe attempting for the 5th time these coming weeks. If it can be broken, the next ceiling will be at 2746, the previous supports attained in Jan and March 2008. I am cautiously optimistic that STI will just have enough strength to hit 3000 before year end comes. We should see a substantial correction in coming 2010.
Trading for the China market has just resumed after a week long celebration of the 60th anniversary of PRC and the mid-Autumn festival. Shanghai Stock Exchange (SSE) will be trading and consolidating between the 2600 and 3000 level to provide a solid base for further uptrend continuation to retest the early August high of 3478. This current consolidation should be viewed as a pause in the long term uptrend rather than the start of a trend reversal for SSE.
Hang Seng Index (HSI) is now climbing towards the 21930 level attained on 17th Sept 209. It will have enough momentum to head towards the next 23300 and 26300 resistance levels if this 21930 ceiling can be penetrated. The immediate support for HSI is at the 21200 level.
In U.S., S&P 500 maybe testing the 1080 resistance level soon. If this can be accomplished, it will have enough strength to climb higher towards the next resistance level of 1168.
Technically, NASDAQ seems to be the stongest index among the 3 major U.S. indexes. It is now approaching the barrier of 2167 level. If it can power through this resistance level, it will have a good chance of testing the next ceiling of 2319.
If Dow Jones can break the 9918 level, it will face a very stubborn resistance at 10,000 level, about 100 points away. Personally, I believe this will be a very very DIFFICULT level to break through. Till now, Dow Jones is lagging behind the other 2 major US indexes, only rallying 53% from the March low, as compared to 71% for NASDAQ and 62% for S&P 500.
Personally, I feel that the global stock markets may have another 1 or 2 more upburst before they experience a substantial correction next year. I am quite sure that the double-dip recession will come next year, but how bad is it going to be, only time will tell. Let’s all enjoy this party, created by the excessive money pumped in by all the central banks in the world through bailouts and stimulus plans, while we can because next year we should see some very bumpy days ahead, maybe well into 2011. I have doubt that we have seen the worst of the financial meltdown triggered by the subprime mess YET 
Disclaimer: Please be informed that the above mentioned stocks/indexes/investment instruments are solely for the purpose of education; it is NOT a recommendation or an invitation to trade/invest. For trading/investment advice, please speak to your remisier, dealer representative or financial adviser. Please understand that there is risk in every trade/investment venture, know your risk first before you venture into any of them.
Global Market Outlook For Week Beginning 28th September 2009
STI has the tested the 2700 level 3 times but is still unable to break this stubborn resistance successfully. It may experience a pullback to the immediate support level of 2560. If 2560 cannot prevent the drop, the next support levels will be at 2521 and 2424 respectively. Singapore market seems to have lost its upward momentum, it is now going through some consolidation before it has enough strength to break through the 2700 level, hopefully going towards the 3000 mark before the end of the year.
Trading for the China market will be light this week because of the 8 days “Golden Week” break. SSE will most likely consolidate between the 2600 and 3000 level, before it can gather enough momentum to break the 3000 ceiling to retest the early August high of 3478. At this point of time, signs are still showing that this is just a temporary halting of the upward momentum, the long term uptrend for SSE is still intact.
After breaking the resistance of 21200, Hang Seng quickly fall below this level in quite a drastic manner. It should find some support at around 20600 level, based on the uptrend line drawn starting early March. If 20600 cannot provide the necessary support, HSI may have a chance to fall back to 19400, the low attained in early September this year.
S&P 500 could not hold above the 1060 level for long and dropped consecutively for the next 3 trading days. The next immediate support will be at 1039, follow by the next uptrend line support of 1000 level.
NASDAQ did not have enough strength to power through the ceiling of 2167. As a result, it declined together with the general weakness in the US market. The next support for NASDAQ will be at the 2050 level.
Dow Jones is experiencing weakeness as well, with the next closest support at 9630. If this fail to provide the necessary flooring, the next critical support will be 9250. The 10000 level will be a very very tough ceiling to crack if it can trend upwards from here.
I can feel that the markets are slowly running out of steam as they have run too far ahead of the real economy. People are starting to realise that the “green shoots” are not really growing into small plants, instead some of them may have slowly turn into yellow weeds. Our Finance Minister Tharman has already forewarned us that we may have a double-dip recession next year, which I fully agree. The stock market has already factored in for a good economy recovery, it may turn down next year when the fundamental does not live up to the expectation. If this happen, we will most likely have a W-shaped recovery, rather than a V-shaped recovery predicted by a few TOO optimistic experts. A lot of experts associate this financial crisis to that of the Great Depression, which started from October 1929 and ended in July 1932, Dow Jones collapsed almost 90% after having a few powerful rallies. This current financial crisis started around October 2007, has it come to an end after just 18 months? I doubt so, we may see some after-effect of weakness, maybe in 2010.
Disclaimer: Please be informed that the above mentioned stocks/indexes/investment instruments are solely for the purpose of education; it is NOT a recommendation or an invitation to trade/invest. For trading/investment advice, please speak to your remisier, dealer representative or financial adviser. Please understand that there is risk in every trade/investment venture, know your risk first before you venture into any of them.
Is the Capitulation here? Time to go in for Bargain Hunting? NOT YET!!!!!
Dow Jones suffered a staggering 1874 points or 18.15% decline last week!! It sliced through the support levels of 10156, 9707 and 9369 like a hot knife through butter with total ease!! It should stage a brief rally at around 8300 level with the K-line (a proprietary tool of T3B System to assess the risk level of a stock or market index) at rock bottom level, which indicates an extreme oversold situation. Dow Jones’s next resistance will be 9043 and 9369 levels respectively. If the 8300 support were to be penetrated again, its next support will be at 7415 level, the low attained in 2003!!
NASDAQ ended last week down 297.88 points, a 15.3% tumble!! With its K-line at rock bottom, NASDAQ should find a support at the 1521 level. It’s next resistance will be at 1753 and 1889 levels. However if the 1521 were to be penetrated again, then we can expect NASDAQ to fall further to a possible low of 1109, last seen in October 2002!!
S&P 500 collapsed 18.19% or down 200.1 points last week!! It should rally from the support level of 942, which T3B System’s one-and only K-line indicates extreme oversold condition. The next resistance levels will be 1014 and 1069 respectively. If the 942 level were to be broken again, we may see S&P 500 heading south towards the 775 level, last attained in 2003!!
STI closed at 1948 last week, it is now down 50% from the high of 3906 recorded in October 2007!! A brief rebound is expected at the 1905 level and the bear rally will most probably meet resistance at the 2190 and 2277 marks. If STI were to pierce through the 1905 support level again, we can expect it to tumble to 1702 level or even lower!!
Capitulation or climax selling occurs when traders/investors PANIC SELL till the level that everyone who had to sell has probably sold. This is accompanied by MASSIVE VOLUME, which shows that everyone has given up on stock market and are desperately selling at any price to get out of the market. We may have started to see some sign of capitulation last week, but we have NOT witnessed EXTREME PESSIMISM yet! This means that we still have more room to drop before the REAL bottom arrives. If u think it is very cheap now, I advise u to think again!! What appears cheap now will get even CHEAPER!! We may have reached a bottom, but NOT the bottom yet!! For those of u who still have stocks that u may have bought last time till now, please take this good opportunity to dispose them during this bear rally. For those of us who have capitalised on the crazy market tumble by doing SHORT-SELLING, now is a good time to get out, take a breather and enjoy our harvest! It is good that the market is rebounding a bit so that when the bear rally cannot sustain and start to turn down again, we can go in for the kill one more time!!
Cheers
Disclaimer: Please be informed that the above mentioned stocks/indexes/investment instruments are solely for the purpose of education; it is NOT a recommendation or an invitation to trade/invest. For trading/investment advice, please speak to your remisier, dealer representative or financial adviser. Please understand that there is risk in every trade/investment venture, know your risk first before you venture into any of them.
STI has BROKEN 2665 support level! Expect another 200 points TUMBLE to 2456!
Dow Jones closed at 11220, down 2.8% or 323 points for the week. It simply did not have enough strength to break the strong resistance of 11638. Furthermore, it broke the 11340 support level with BIG volume. This is a very negative sign which shows “distribution” or unloading by the big boys or big funds! We may see further weakness and the next support level for DOW Jones will be 10680.
NASDAQ plummeted 4.7% or 111 points to close at 2255 for the first week of September. It has broken both the support level of 2345 and long-term support line with BIG volume, this spells trouble!! It may tumble further and be supported at the 2155 level.
S&P 500 slipped 3.2% or 40 points to close at 1242 for the week. It broke it’s stubborn support of 1256 with increased volume. It is now testing the 1219 support level. It’s next support will be another 51 points down at 1168 level if it continue to fall.
STI GAPPED DOWN 51 points or 1.97%. to close at 2574 last Friday! It has broken both the 2700 and 2665 support levels with big volume, a very negative sign!! STI ended the week down 6% and is currently at a 2-year low since 4th October, 2006. It is likely to tumble further till the next support level of 2456. If this 2456 level were to be penetrated too, then we can expect another 200 points collapse to 2277!
Negative market sentiment has been driven by weak U.S. market as well as growing concerns that global growth is seriously slowing down. Market sell-down was fueled by the report that the U.S. unemployment rate jumped from 5.7% to 6.1% – its highest since September 2003. This raised concerns about the pace of consumer spending in the months ahead. Continued concerns about the potential for further write-downs at financial firms and speculation that more hedge funds could be in trouble and on the verge of liquidating assets also cast a pall on the market. Many investors are either taking cover to pare their losses or simply watching from the sideline. U.S. data due to be out this week includes consumer credit, pending home sales, retail sales for August and trade balance for July.
I want to reiterate that holding stocks now is VERY DANGEROUS! For those of you who proclaimed yourselves to be “long-term investor”, this time round u are NOT going to be one, instead u are going to be a VERY “long-term investor” because we are now going through a GLOBAL FINANCIAL CRISIS! It is going to deliver even more devastating blow than the Asia financial crisis in 1997, 1998. Congratulations to those of US who are still hanging on to our short positions!! I simply cannot understand how one CANNOT make money by doing short-selling in the current bear market!
Happy SHORTING! Cheers
Disclaimer: Please be informed that the above mentioned stocks/indexes/investment instruments are solely for the purpose of education; it is NOT a recommendation or an invitation to trade/invest. For trading/investment advice, please speak to your remisier, dealer representative or financial adviser. Please understand that there is risk in every trade/investment venture, know your risk first before you venture into any of them.
STI has broken the critical support of 2746! Expect more downside risk!
Dow Jones rallied 1.7% to close at 11628 last Friday. However, this increase was insignificant because it wasn’t backed up by strong buying volume. A more likely reason for this surge is due to the US$6 tumble in the oil price. Dow Jones is now experiencing very strong resistance at the downtrend line and 11638 level. Even if this resistance can be broken, it will face another barrier at the 11867 level.
Last Friday, NASDAQ increased 1.4% to close at the 2414 level but with declining volume, which is a negative sign! It’s next resistance is around 2464 level. If this level were to be penetrated, then the next obstacle will be the stubborn 2533 level.
S&P 500 rallied 14.48 points to close at 1.1% higher before the end of last week, but with a shrinking trading volume. It’s next resistance is 1313, after which the next barrier will be 1368.
STI closed at 2723 points last Friday, down 74.2 points or 2.65% for the whole of last week. It has broken the critical support of 2746 and this spells MORE downside risk! The next support is at 2665. If this level were to be broken too, then we can expect another 200 points tumble to the next lower support of 2456!!
A rally in S’pore due to the surged in US market may not be sustainable this week due to the drying up of liquidity. The total turnover last Friday was only just S$864.1 million, below the S$1 billion mark. New money taken in by offshore Asian funds shrank from US$803 million 4 weeks ago to a mere US$22 million in the week ended 13thAugust. With the absence of a significant influx of foreign money, we may not be able to see a sustainable rally in our stock market soon. So the best thing to do now is to still perform “SHORT-SELLING” or “SHORTING” as we can expect more downside since the critical support of 2746 has already been broken for STI.
Cheers
Disclaimer: Please be informed that the above mentioned stocks/indexes/investment instruments are solely for the purpose of education; it is NOT a recommendation or an invitation to trade/invest. For trading/investment advice, please speak to your remisier, dealer representative or financial adviser. Please understand that there is risk in every trade/investment venture, know your risk first before you venture into any of them.
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