Technical Analysis – 17th Feb 2009

Good day folks!

Apparently, the STI has decided to break that 1680 level today. Regional markets have also tanked and the US markets aren’t doing too well at the time of writing as well,  testing its previous lows already.

The STI has come to rest on a minor support at 1640. If this gives way 1580 comes into play, thereafter 1470 again. Based on some calculations, I do not expect these levels to break just yet. Hence these will be my zones to profit take. Loads of sell signals have been apparent over the weeks and today, short signals appeared. Confirmation will come tomorrow.

SIA’s bear flag came into fruition today. I was hesitant if I would add more on SIA or UOB. Eventually I picked UOB but I might add SIA on a tech rebound. 10.40 will be a good entry point.

SGX is one that broke its 4.94 support with volume. There is gap support till 4.75 and is likely to be filled.

The risk reward for CCT is also pretty good. If you can get scripts for it, 84c is a good level to go short with a very near cut loss point of 87c. The concern is bout the volume though.

Let’s see where this goes.  The chart pattern is largely similar to what has happened before. However there comes a point where shortists have to cover as fundamental buyers will step in to hold those ‘ridiculously’ low prices. That times however is not here yet. What I am waiting for is for people who went long to begin dumping. When a critical level cracks, they are likely to join in going short too. Calculations and wave counts suggest a long lasting rebound in the pipeline. Also in the pipeline is the wave 3 flush which is typically fast, and furious. Incidentally, the oct crash was somewhat a wave 3 flush. The same may happen. It may not happen as well. Whatever the case the prudent thing to do is to observe the price actions to pre empt the next trend. It is with this in mind that I did not close any short positions and many are due to be rolled over in the next 1 or 2 days.