Crazy news!! The STI is just 7 points away from friday’s high when brexit was announced. It as if Brexit didn’t happen and all it took was just two days for the market to recover back to where it started. Amazing? Crazy? Well, welcome to the stock market, where anything goes and rational thoughts goes out the window.
It might see irrational that market can just recover so fast and you might be lost by now. Well, we too have been stunned by the recovery but as we mentioned before please ensure that your stop loss is in place. We can’t and won’t get every direction right that’s why we need our stop loss in place for moments like this.
So stay calm and lets see what the chart says now
As we can see, the short term downtrend was touched and pulled back after that, the next one to look out for would be the 200ma at 2817 then finally if that holds then 2837. These are some of the resistance points we are looking at. IF the index shows weakness at these areas we might look for shorting opportunities.
In the aftermath of Brexit , Gold has hit a new 2 year high of 13oos as we speak. Beside trading spot gold which involve margin and risk of margin call , exchange traded funds ( Etfs) are another asset class we can look to invest ( for buy and hold) to benefit from the rising gold price. SPDR Gold Share (GLD) and VanEck Vectors Gold Miners ETF (GDX) are 2 such etfs which we can look at .
SPDR Gold Share (Ticker Symbol: GLD)
This Etf seeks to reflect the performance of spot gold price. It is both listed on SGX and NYSEArca in USA . Both image refers to the GLD listed on SGX. In the first image , Since 10 February this year , when GLD broke above its well define downtrend line which was in place since 2013 , it has not look back and has been on a uptrend since then.
In the Second image , GLD has been in a well define uptrend since January this year , if it pullback to the uptrend lower channel support line the next time around US$119 level, it may present a good risk reward entry level .
VanEck Vectors Gold Miners ETF (Ticker Symbol : GDX)
VanEck Vectors Gold Miners Etfs (GDX) seeks to replicate the price performance of NYSE Arcra Gold Miners Index . It is listed on NYSEArca in USA . When Spot Gold rises , it tends to positively impact the share prices of Gold Miners in general . Hence this Etf is a good proxy to the price of Spot gold . In the first image , Since February this year , GDX has broken above its well define downtrend line which was in place since 2011 , and been on a uptrend since then.
In the Second image , GDX has been in a well define uptrend since late January this year , if it pullback to the uptrend lower channel support line the next time around US$24-US$25 level, it may present a good risk reward entry level .
Well, yes its true, UK voted out of the EU and the whole world is in shock. What will happen next?
Some concerns would be currency wars as the pound and euro slides will other countries have to devalue their currency in order to stay competitive too? How will companies with exposure to UK be affected as now they have a weaker pound to deal with. Companies with earnings in pounds might take a hit we suppose.
So is this a time to go in to scoop up some stocks or do we wait and see or do we go short? With some saying market has priced in the exit on friday. Lets looks at some charts before we decide. Remember we’re just sharing our humble views only ya. =)
from the previous update, if there was a vote to remain we could see an upside but that did not happen but the vote was to leave and we saw how STI plunged to our support area of 2722. Well, if the support of that breaks then we could see STI covering gap to 2683 and if that don’t hold then 2630. It seems to us that downside might be more likely given how violently the market reacted and it was a shock to the markets as most were pricing in a stay. Till now, it seems unsure of the real implication and people are trying to make sense of whats happening. Rebound could happen but we are looking to short on rebound meaning to say short at resistance after a rebound or short when it breaks down .
Still quite resilient being supported by the uptrend line and horizontal support, a break of 2.73 would be a short for us and the support levels as our target downside.
Sembmar on the other hand, is a weaker stock, and 1.505 is the support, a break of that might take it down to 1.40. Remember your stop loss too which we will place at 1.60
Do refer back to the chart of capitaland which we posted on 14june, the support finally broke and it slammed down to a low 2.87 on friday. Remember we only short when it breaks the support unless you are willing to take more risk on short on anticipation .
Comfort delgro having exposure in UK and due to the fall in the pound, its revenue might take a hit too, on friday people were selling comfort del, but it hit a support of 2.62 and had some rebound, if it breaks the 2.62 downside might be to 2.55 then 2.51. Remember your stop loss
Local banks also took a hit as they also do have some exposure to the pounds. We are looking at those support levels.
There are alot more charts to share but of course with limited time and space we will stop here for now.
Some points on trading this week, remember to HAVE a stop loss whenever you are trading. Market could rebound since it dropped quite a bit during the week.
We prefer to wait for stocks to break support then short or touch hit resistance then short .
We’re watching this stock called sinamars land and recently it released some news on its website
SOUTH TANGERANG, KOMPAS.com – Sinarmas Land officially announced the development of the Digital Hub area in southern BSD Green Office Park City, South Tangerang. –
It is currently testing the uptrend line of 0.47 and a break above that might see more upside to 0.49. It could consolidate to the end of the wedge so do that note of that see where it might potentially go .
With all eyes on brexit, just an update on STI, if britain were to stay we might see STI moving up to 2845 area which then might be resisted. Around there we might have to wait and watch to see what happens then. If market continues to be strong then don’t short yet and follow the trend.
If britain exits then we might see more downside tomorrow to about 2722 level..
Also similar to sembcorp, there was an increase in vol today and its also near is uptrend line and horizontal support line. If we were to short we should short either at when it breaks 5.25 or if you want abit more confirmation then perhaps when it breaks 5.20 . Stop loss will be 5.38 or 5.26 accordingly.
Hey, do look at china Aviation , there might be a chance to for short if it breaks the horizontal support of 1.145. Stop loss at 1.23
SGX is another one, if it breaks it horizontal support of 7.42. Stop loss at 7.52. Don’t have time to post the chart so do look at the charts first ya.
Its getting late, just decided to update the blog before catching whatever sleep possible. =)
Sembcorp as we can see, is now hugging on its uptrend line at about 2.72 which also coincides with the horizontal support line. Its testing it the third time and if this breaks we might see it head down south to about 2.52 area. A nice reward with a short entry at 2.71 and stop loss at 2.83.
STI and noble came down further after our blog post while we’re still waiting for capitaland to trigger for shorts. Hope you’re not trying to catch the falling knives and getting hurt along the way.
It was an interesting day today, STI opened up looking promising and even turning positive at one point and we were watching closely to see if it can stay above the uptrend line. Hours past and finally it couldn’t hold and gave up whatever gains and closed down 17 points. It is currently below the uptrend line and with that we might see more downside to 2700. A stop loss would be at 2800 because if it crosses above that it might start to cover the gap.
Bank stocks might be worth taking a look for short too, OCBC , DBS are some of our candidates. Do do your own diligence too ya. We updates on the banks shortly
Capitaland is currently sitting very near it uptrend support line of about 2.93. The short term uptrend line is currently supporting it and its testing that line for about the third time. If that line breaks, we might see further downside to even 2.50 in the coming months. Our stop loss if we were to short below 2.93 would be 3.06 above the 200ma quite good risk reward ratio we feel.
We are to also look at the STI and how it performs. If the STI continues to be weak, we might see capitaland go down together with it. Stay tune. Will update on the STI .
It’s been a long while since we last wrote. We have gone through quite a life changing moment during the last few weeks hence was away from work. But all is well and we’re back to updating.
We’ll like to start by looking at noble. We been updating noble on our blog for awhile since it was about 47 cents when we first started our blog. Sadly since then it has halved its value to now just about 23 cents but hopefully some of you all made money through the downside.
Noble’s volume today seems bigger than the last few days with that one would want to pay abit more attention to it. It staged a rebound the last few days but the rebound was short lived and we see more downside to come. We have to zoom out to out a 15 years chart in order to see the support levels.
Support levels we are seeing is at 22 cents then 20 cents.