STI 28 Feb 2014

This is the strength and ferocity of the inbound trend of STI since it hit a low on the first day of February. Will the red downward trendline resistance be enough to contain it? Actually if it breaks the red line resistance, it will be kind of hard for me to trade as all my current analysis would be invalidated. I am prepared to short the index stocks at the resistance. If it pierce through, I guess I would not trade for some time and just bid my time to short again.

Am I too stubborn and like to stick to my views? Maybe.

The way I see it, even if the STI manages to pierce the red downward trendline, it will meet a lot of overhead resistance if it were to continue to move up. Taking that route will be more choppy to me. It will mean more whip-saws and choppy times in the market.

Anyway, let's continue to monitor. I believe by end of next week, we should have an answer.

CLOSE TRADE - SIA 19 Feb 2014

Was stopped out of this trade after 4 days. Had entered this trade on 13 Feb after the earnings announcement day @ $9.89. After that, stock price was hanging around $10 resistance with low volume. I thought that $10 ceiling would be enough to contain the stock price, and it will fall after attempting this resistance.

However, STI was up for a couple of days in a row, and inevitably, SIA followed as well. Was stopped out on 19 Feb @ $10.09. I count myself lucky in this case as I set a lower stop loss than the one I planned @ $10.14. Stock continue to make high after I was stopped out. Quite surprised it has the strength to do so. In fact, it pierced the 200-SMA as well. Seems like only the $10.50 resistance would be able to contain SIA if it continues to prove so strong. Volume did pick up when it is attempting to move up.

On hindsight, on the weekly chart, I should have expected the bounce judging from the high volume bar when it hit the $9.50 support. Though the bounce was expected, the strength of it surprised me. Like I said, the $10.50 resistance should have a decent chance to cap the bounce. 

Still shorted too early. Bidding my time...

STI 14 Feb 2014

This is the STI chart. Are you as surprised as I am that the index managed to break the support-turned-resistance level @ 3025 region? I had thought that was how far the index will throw before it will fail again. Hence my rationale for shorting 3 stocks this week. However, the US market and regional markets had other ideas, and continue to make high or throwback further.

It made me waver in my opinion. What I fear now is that this rebound will continue for a few weeks, until the bears are being short squeezed. Perhaps this will really be the last wave to lure the buyers in, plus squeeze the bears at the same time, before all hell break loose. Or, it will be an indication of what to expect for the year ahead... choppy days, and being bound in a ranging market, with the support and resistance preventing any breaks, on the up, or down sides. This is what I fear most, that the market is not directional!

Anyway, as long as the STI does not break 3250 level, I am of the opinion that the bear market is waiting to be triggered. No break 3250, no bull market for me. Couple of resistances along the way till the STI index can come to test the 3250 levels. I hope I don't have to face the prospect of 3250 being broken! To me, now is the technical rebound for the short term period. Mid term, and long term wise, it is still a bear market to me.

TRADE - First Resource 13 Feb 2014

I have to admit here. This First Resource trade was a mistake. Had wanted to short Semb Marine during my break time. Keyed in orders in IG Markets, and then realized it was unborrowable. Sort of panicked and then tried to recall which stock broke its support recently and was doing a weak throwback. First Resource came to my mind, and I just queued @ $2.05 in the morning of 13 Feb. In the end, it choose this day to do a throwback with high volume. $2.05 was a level that it had not throwback to during the previous few days. That's why I queued there, not really expecting the trade to be triggered, and definitely not expecting it to have a strong throwback on the day that my trade was triggered!

Now, I am waiting for my chance to wriggle myself out of this trade. But the inside day with low volume on 14 Feb is making me uncomfortable! Seems like still can continue to throwback! I think my closure of the CDL trade on 14 Feb had something to do with this losing trade. Am I allowing my losses some room; while quick to take profits off the table? Cut my profits short, and let my losses run?

TRADE - Singapore Airlines 13 Feb 2014

Shorted SIA on 12 Feb. It has a runaway gap on 11 Feb after the results announcement. The stock has been pretty weak for some time. My regret was not shorting it earlier when the price was still above $10. Hesitation plus it did not throwback much when it bounce off the $10 support before it failed. Hit the support @ $9.40 region before it bounce off again from the results announcement. Saw that it was approaching the overhead support-turned-resistance @ $10 region, and hence decided to short the stock. Queued @ $9.89. 2 levels of resistance for SIA. The 200-SMA @ $10.20 region, plus the resistance @$10.40.

SIA had failed way back in 2011 during the Euro crisis in 2011. While other component stocks had managed to recover, and test their respective highs, SIA has been languishing between the $10-$11 range for close to 2 years before it broke the $10 support in Aug 2013. Definitely one of the weaker stocks. I think now is bouncing off the support @ $9.40 level, before it will fail and then bounce from $9.00 level again. I have the 200-SMA @ $10.20, and resistance @ $10.40 acting as a ceiling. Need to endure the pain from the short squeeze, if any.

CLOSE TRADE - City Development 13 Feb 2014 & 14 Feb 2014

Entered and exited CDL on 2 occasions this week. First trade hold over a few days, while the second trade was entered and exited on the same day on 14 Feb. The hourly chart below depict my respective entries and exits.

When I entered CDL on the first occasion, it was for a quick hit-and-run play as CDL has the range for  swing trade. It had been making a counter trend rally for 4 days and all 4 bars closed near their respective highs. I entered in the closing hour on the 4th bar. When it continue to make high on the next day, I thought I was wrong. How often do you get a 5-day rally for an index stock? Lucky it closed with tails on either ends, telling me it was showing some signs of weakness. However, it continue to make high on the 6th day, only that this time it closed just off low, with an inverted long tail. Another sign that some pullback is due. Meanwhile the regional markets were rebounding strongly following the strong US markets, and the STI even managed to clear a minor resistance point. Not exactly that weak! My instinct was telling me I have to take the profits if avail. I queued @ $9.11 and the order was filled at the opening minutes on 13 Feb. 

Sort of regret my decision to close as the STI make another high on 13 Feb, but closed off high. Was it telling me that it was not so strong? That its throwback is finishing soon? Anyway, decided to queue @ $9.25 to short again on 14 Feb and that order was filled soon in the opening hour. Towards the last hour, decided to close the trade as CDL had very low vol for that day. In fact, the volume for 14 Feb was the lowest in 2 weeks. Where are the big boys for this stock? Hence, I exited this CDL trade again.

Profits on both occasions. But not exactly proud of it. Feeling jittery. My hunch is telling me about being short squeezed. Perhaps one last wave of upwave to squeeze the shortists and then trap the retailers to come in? 

STI 07 Feb 2014

STI broke the psychological support at the 3000 level and even broke the pivot low at 2990. It hit a low  of 2953 before it sort of followed the worldwide market rebound and managed to close above 3000 points again. Sort of hanging on there for the time being. The selldown was sharp and quick, and suddenly the folks realized that it was overdone and bargain hunters have come in to support the market.

On the weekly chart, STI has broke the pivot support, bounced off its low, and managed to close as a hammer. This is accompanied by higher volume. Seems like the rebound might continue for some time?

Anyway, the strong support is at the 2930 level. It will take a lot of fear and volume to break that level. I wonder what will be the given reasons should that happens.