Technical Analysis – 3rd Feb 2009

Couple trades done today and I’m revising some targets as seen -

The STI has had terrible volume today which is absolutely nothing to shout about at all.  Initially I called for a upside target of 1850. I am revising it downwads towards 1780 which is 38.2% support turn resistance.  1650 remains crucial support at 61.8% which is also the gap support. Notice the gap covering on 21st Jan with the nice white candle? Oh, it was the day I left for my holiday! If 1650 (1680 first) cracks, then the STI will be in trouble. 1715 remains as immediate resistance. I will not be surprised if this is re-captured in the next few days but if it comes on light volume, I suggest players to take it with a pinch of salt.

I mentioned shorting Allgreen earlier. Terrible volume and I had no choice but to remove my queue and sell down at 47c. I have to say, based on indicators there is no real reason to short.  My proprietary calculations show a good possibility for it to come down to my interim TP of 43c. It might take a while though.  Cut loss is pretty near, with 100MA and the previous high acting as resistance. Money Flow is healthy, but RSI shows some bearish divergence which further suggests the up move will lose steam. Add that to all the resistance overhead, I agree with Jay on this one. Thanks Jay for the tip!

Went into Sembmar today. I was worried bout being whipsawed so I did go in partially when 1.53 cracked but as you can see it did not close below with heavy volume. I was waiting for volume, didn’t get it so I did not add on more lots for today.  Another tip given by Jay, thanks! Watch for 1.53 carefully.  Immediate target upon cracking is 1.36, thereafter around 1.15. I like the bearish indicators. But I am not willing to go in full right now where the cut loss is at 1.7 and there it is possible it may rebound. I am entered partially based on price and pattern. Time? This one I have not been able to calculate yet. It may happen tomorrow, it may happen next week. Hard to say.

US futures are mixed to slightly green. It is possible yesterday’s reversal candle may come into fruition. Reversal  does not mean the trend has changed. There is no indication of a bear rally yet. A tech rebound is overdue however, and so is a dead cat bounce perhaps.