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Charts in brief: 21 Jun 10.

Monday, June 21, 2010

Most counters in my watchlist are positive today as the STI gained to close just a whisker off 2,880. It would seem that the Chinese government has done the world a great favour by deciding to let the RMB strengthen. This is something I have believed should happen for some time. A stronger RMB would ameliorate the problem of inflation within China, raise the purchasing power of its people and improve standards of living. Increased domestic consumption would do a lot of good for China's own economy as well as the global economy. You might want to read what I wrote in an earlier post here.

AIMS AMP Capital Industrial REIT: Volume expanded today and all trades were done at only one price, 22c. MACD has turned up.  MACD histogram has a buy signal. MFI has turned up, forming a higher low. OBV has turned up, suggesting increased accumulation.

CapitaMalls Asia: Price broke the resistance band of $2.19 to $2.21 which I identified earlier. Closing at $2.22 seems bullish but volume suggests that this might not be durable. This counter is probably rising due to a lack of sellers rather than an abundance of buyers. Nonetheless, the momentum is still good as suggested by the MFI and price might be pushed higher.

Courage Marine: The picture is somewhat similar to CapitaMalls Asia.  A white candle day on improved volume but not impressively so which suggests a lack of sellers rather than an abundance of buyers. MFI shows improving momentum while the OBV has turned up slightly.  It remains to be seen if resistance at 20c could be taken out. A significant resistance after 20c is at 21c.

FSL Trust: MFI and OBV continue to rise. Could 40c be taken out this week? The next resistance level which is likely to be a strong one as suggested by candlesticks and a declining 20dMA is at 42c.

Golden Agriculture: Price continues to be resisted at 55c although it touched a high of 55.5c today. Momentum is still positive and MACD is about to cross into positive territory. Volume is, however, unimpressive which probably resulted in the failure to take out 55c and instead formed a white spinning top which is a possible reversal signal.  Support is at 51.5c in case of a trend reversal.

LMIR: It seems that the merged 100d and 200d MAs are too strong to be taken out today. Price closed at 47.5c which is where we find the 50dMA, forming an inverted cross in the process. The negative divergence between price and volume continues to suggest LMIR has been rising on weak technicals. If the 50dMA does not hold up as support, the next support is at 46c as provided by the 20dMA.

Related posts:
AIMS AMP Capital Industrial REIT: Big boys.
Courage Marine: Triple bottom?
Golden Agriculture: Resistance remains at 55c.
LMIR: Testing resistance.
FSL Trust: Verona I.


Anonymous said...

Hi AK71,

thanks for the insight. One thing i noticed maybe it's more SGX stocks..the liquidity is not there, so thus the wild swings of stocks does not really happen. Neither do you see Hi-Cap stocks..and i do not see those 10sgd as high cap.
Given the recent RMB realighment, are there any stocks which you feel would be positively effected due to businesses in China?..I noticed Courage Marine seeing a bit of +ve upside. FSL maybe...too bad Sg does not have any mining/ commodities stocks which would benefit.

AK71 said...

Hi Anonymous,

The Singapore stock market is relatively small by global financial centres' standards. I have friends who tell me they make more money trading the HSE, for example. I am not so adventurous though. ;)

I suspect that the Chinese are not allowing the RMB to strengthen just to help the world. They are doing themselves a big favour as well. Remember how the Japanese were buying up assets around the world more than 20 years ago? The Chinese has been doing it in recent times (Singapore's Noble Group comes to mind). With a stronger RMB, the Chinese could step up their efforts to aquire global assets.

I hesitate to name specific companies which would be beneficiaries of a stronger RMB. However, any company that is exporting to China should benefit. Any company with operations within China that cater to domestic demand should benefit.

If you like commodity stocks, Singapore does have some CPO producers which have exposure to Chinese consumption. ;)

Could you leave your initials or name in your future comments? Thanks and good luck.

Dou said...


U bullish or bearish? Just a survey

S & P 500 already hit a resistance, what do u think?

Pullback or correction?

AK71 said...

Hi Dou,

Personally, I am wary of the rally. I see negative divergences. So, rising prices seem to be on the back of weak technicals in many instances.

I think 2400 points on the STI is still a real possibility. A correction to that level or close would remove the froth from the market and would set a up a stronger platform for further upside.

Of course, Mr. Market does not care what I think. Time will tell. :)

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