Charts in brief: 2 Jul 10.

AIMS AMP Cap Ind REIT: Volume rose today as more shares changed hands at the 21.5c support.  MFI declined sharply as short term demand seems to have disappeared. In spite of this, there is no sharp decline in the OBV.  Instead, it is flattish which suggests a lack of heavy distribution activity. From the high achieved on 3 Jun, price seems to be doing a low volume pullback to support.  If 21.5c support should break, I would be happy to buy more at the long term support of 20.5c.  Based on FA, I think that is a very attractive price. TA is more mutable and needs to be looked at again at that point in time.

According to DTZ Research, the improving Singapore economy has caused industrial rents in Singapore to rise for the first time after quarters of decline since Q3 2008.

DTZ’s latest report on industrial property stated, “Average monthly gross rents of first-storey private industrial space edged up 2.6% quarter-on-quarter (QOQ) to $2.00 per sq ft and 3.2% QOQ to $1.60 per sq ft for upper-storey space per month. Since the height in Q3 2008, average monthly gross rents of first-storey and upper-storey private industrial space have fallen 14.9% and 22.0% respectively.”

However, the research consultancy reported that “rents for hi-tech industrial properties, which include business park and science park space, were unchanged at $3.15 per sq per month in Q2 2010.”Article here.

Healthway Medical: Clinging on to support at 19c while forming a gravestone doji is ominous. The rising 20dMA is exactly at 19c now.  Will it push the price higher in the next session or will it fail as support? The MFI, which accounts for price and volume and is a measure of demand is clearly in decline.  The OBV shows the sharpest drop in three weeks, suggesting that distribution is heightening. MACD continues to decline below the signal line. It is obvious that upward momentum and demand have both weakened. If 19c breaks as support, next support is not far away at 18.5c which was a resistance formed in March as price tried to advance higher then.

SPH: A friend asked me if he should sell his SPH shares today. Let's look at the chart.  With today's expansion in volume on a white candle day as price hit a high of $3.88 before closing at $3.85, SPH looks like it might be able to go higher. MFI has been forming higher lows, suggesting rising demand. RSI has been rising as well.  The MACD is still in positive territory.  In short, SPH is seeing some underlying strength. $3.88 is the resistance to watch.  If it breaks convincingly, I see an eventual target price of $4.08. I would be happy to sell more of my remaining shares in SPH then.

Related post:

SPH: Reading the lines.

CapitaMalls Asia: Downtrend continues.

CapitaMalls Asia: I warned that the retest of trendline support on 25 Jun could turn treacherous. On 27 Jun, we looked "at the MFI which accounts for both price and volume. Here, we have a less optimistic picture as the MFI has clearly broken its uptrend. This suggests that demand has dropped and that more selling is underway.  This is a major difference from when the trendline support in question was tested twice before. In those earlier tests, the MFI was still uptrending strongly. Technically, the picture is weaker now."

Anyone who heeded the warning delivered by the MFI would have been spared some losses. Has the picture changed? Well, if anything, it has deteriorated. As price declined from the high of 23 Jun, volume has expanded. MACD has dipped into negative territory while all the momentum oscillators continue to decline. Momentum has turned negative. MFI suggests that demand is much reduced.  RSI suggests that the speed of decline has accelerated. OBV suggests ongoing distribution. Immediate resistance at $2.07 and the next support is at $2.00.

Related post:
CapitaMalls Asia: Weakening technicals.

STI: 2400 is still a real possibility.

It has been a while since I looked at the STI. Looking at it again today did not reveal anything alarming. Well, not alarming as in I did not see anything I did not expect to see.  The picture is still more negative than positive.

The MACD has been closing in on the signal line and is now set to do a bearish crossover. MFI, a measure of demand, has been in decline. RSI has also been in decline which suggests that the attempt to continue the longer term uptrend is sputtering.

Using the high of 15 April and the low of 25 May, if we draw some Fibo lines, it is interesting to see that the move up in the STI in recent sessions has met with resistance at the 38.2% line which is at 2,890.  This same resistance capped gains earlier in May.

If the STI is unable to break resistance at 2,890 this week, we would probably see the formation of a lower high on the weekly chart.  Two more sessions to go.  This has implications where chart patterns are concerned.  We might see the formation of a head and shoulders pattern which would be very bearish.

The rising 200dMA at 2,800 approximates the 61.8% Fibo line. This might give the STI some bounce but the bias is for a move downwards if resistance at 2,890 is not taken out convincingly. 

Breaking the previous low at 2,648 would probably see the STI sinking to the eventual target of 2,400 which, incidentally, is not a number plucked from the air but is provided by the 161.8% Fibo line.

Related post:
STI: Falling through the 200dMA.

NOL: Downtrend.

After hitting a high of $2.35 on 15 April, NOL was in a downtrend which was broken on 16 Jun on relatively high volume. Price hit a high of $2.13 on 21 Jun while forming an inverted white hammer, a reversal signal. This reversal signal was promptly confirmed in the next session. Forming a high of $2.13 on 21 Jun created a bearish picture because it was a lower high compared to the high of 13 May at $2.18.  This was a warning sign.

The MACD histogram turned red on 22 Jun while the RSI and OBV turned down the same day. Price has broken through various supports since then.  Price is currently resisted by the merged 20d and 100d MAs at $1.97.  With the 50dMA declining just above these merged MAs, it would be a difficult resistance to overcome without a buy up on massive volume.  Any upside could be resisted by the 50dMA just a few cents higher at $2.00. It seems that there are more sellers too if we notice how volume has increased as price declined since 21 Jun.  This is confirmed by the lower highs on the OBV which suggests that distribution activity has increased.

The MACD has formed a bearish crossover with the signal line and a retest of the flattening 200dMA which is currently at $1.83 seems likely.  As a support, the 200dMA was breached on three consecutive days in late May. So, this makes it somewhat unreliable and it is, therefore, a very important support to watch now.  If it manages to hold up, we would have a higher low formed.  A symmetrical triangle could then be in the works.  If the 200dMA support breaks, we could see the previous low of $1.75 tested.

Given the bearish technicals, I would sell at resistance at $1.97 if I have the chance to do so. If luck is on my side, I might even be able to sell at $2.00 on a possible whipsaw. Prices do not go down in a straight line and there could be little bumps up along the way.  So, a retest of the 100dMA as resistance again is possible. Of course, it might not be at $1.97 then. We want to sell at resistance and buy at supports.  Use the prevailing trend as a guide. Good luck.