DBS, OCBC and UOB. Higher or lower? My plan.

No one can accuse AK of being lazy in the last few days.

I am feeling a little tired from looking at charts and following the news.

Been publishing blogs and producing videos too.

Thinking of taking a few days off from blogging but the OCD in me grabbed me.

For the sake of completeness, one more blog on DBS, OCBC and UOB.

Completeness?

Well, the TA I did yesterday which resulted in two blogs being published paid more attention to the bearish sentiment.

Today, we saw a nice bounce in the stock prices of all three local lenders.

Not to keep readers in suspense, a blog to explore the upside possibility will round things off nicely.

Then, for quite a while, I believe readers can use this blog and the last two blogs as references if they so wish.

So, let's start.

Like I said, the stock prices of all three local lenders had a nice bounce today.

Let us start with the strongest this time, OCBC.

Yesterday, I said OCBC exhibited the most resilience.

Today, the green spinning top delivered and OCBC's stock price broke resistance provided by the 200 days moving average.

That the stock price closed at $12.27 comfortably above the moving average which is at $12.14 is encouraging.

However, whether it will stay above this moving average in the next few sessions remains to be seen.

Volume is the fuel that drives a rally and because OCBC's stock price rose on relatively low volume today, there might not be a strong follow through.

Although a green candle formed today, it has a very long upper wick. 

This suggests that Mr. Market lacks conviction as the stock's closing price was a mere 3 cents higher than its opening price while the high of the day was 19 cents higher than the opening price.

If there should be weakness, we would probably see the 200 days moving average, the resistance turned support tested.

If that should break, then, the support levels identified in my previous blog would be next.

Moving on to DBS.

Just like OCBC, DBS saw much lower volume today compared to yesterday even as its stock price moved higher.

As expected, the 200 days moving average, currently at $33.16, remains the resistance to watch even though it is a green candle day.

The MFI suggests that DBS is just about to move out of oversold territory while the MACD suggests that momentum remains very much negative.

This suggests that buying interest could weaken tomorrow and it would be interesting to see if DBS could recapture the 200 days moving average as support.

If there should be more downside, then, the possibility of a move back to $30 a share which I blogged about yesterday is back in play.

Now, for UOB which I said yesterday had the weakest chart of the three.

Has this changed?

I was pleasantly surprised when I saw the resistance provided by the 200 days moving average taken out but it only lasted for a short period of time.

UOB's stock price eventually retreated to close only 3 cents above its opening price.

The 200 days moving average is, therefore, still the immediate resistance.

Volume today was very much lower than yesterday too.

So, it really isn't surprising that the push to move  the stock price much higher could not be sustained.

The green candle formed is similar to OCBC's as it has a very long upper wick which suggests a lack of conviction on Mr. Market's part.

The MFI suggests that UOB is no longer oversold and the MACD shows that momentum is still negative.

So, it is similar to DBS in this respect which suggests that buying interest could weaken tomorrow.

If prices should move lower, then, the longer term support I identified in yesterday's blog could be tested in due course.

What would I do in such an instance?

Before I continue, please keep in mind that this is what I will do given my circumstances.

We have different circumstances and, also, beliefs.

We should have our own plan even if we are presented with the same set of information.

It is clear to me that stock prices of DBS, OCBC and UOB are all trending down.

Some of us might remember the saying: "The trend is our friend."

Also, "Don't fight the trend."

As a retiree with limited resources, I would rather err on the side of caution.

There is also the fact that I already have a significant exposure to all three local lenders. 

So, I am in no hurry to add to my investments.

Technical analysis is mostly backward looking but it can give a glimpse of what might happen from time to time.

This is why I always look for divergences between stock prices and the momentum oscillators as divergences are forward looking.

Looking for divergences was also how I was able to tell that OCBC's stock price would be more resilient than DBS and UOBs'.

Remember to have a plan and it should be your own plan.

Related posts:
1. Buying OCBC.
2. More downside or reversal?
For anyone who is interested, ticketing for "Evening with AK and friends 2023" is ongoing.