Courage Marine: Dual listing.

On 14 November 2010, I said that "It would have to take a very bad 4Q 2010 to destroy whatever the company has achieved in positive numbers thus far in 2010."

Although the BDI has been declining and "even if 4Q 2010 does not turn in any profit which I believe is unlikely, net profit this year is already 120x higher than the whole of 2009!" So, I firmly held on, believing that the management would declare a generous dividend when the time comes.

Courage Marine gapped up today as it opened at 22c. My overnight sell queue was filled as I reduced my exposure to the counter by half. For me, locking in a gain now is like getting the dividend in advance. After all, the declining BDI is likely to have a negative impact on Courage Marine's earnings, going forward. The BDI has already broken the previous low and it is yet unclear where the next low would be but with greater increase in bulk shipping capacity in the near future, upside could be limited as supply outstrips demand.

 BDI
 (Source: Bloomberg)


What would I do with my remaining position in Courage Marine? I would hold on to see if price could go higher either through further developments in its plan to dual list in Hong Kong or through a possibly generous dividend payout.

Looking at the chart, immediate support is currently at 21c although it seems precarious as MFI and RSI spiked into overbought regions. Any weakness could see the counter pulling back to 20c which offers a stronger support and would correct the overbought condition. Further upside could see Courage Marine retest a many times tested resistance level at 23c. I would be tempted to sell more then.

Related post:
Courage Marine: 3Q 2010 results.

Courage Marine +13.2%; latest dual listing play 
Tuesday, 18 January 2011

© 2011 - The Edge Singapore

Courage Marine seeks dual listing in HK stock exchange. Courage Marine also believes the listing will also enhance its profile in Hong Kong and in China which are becoming increasingly significant markets and facilitate business opportunities, customer relationship and business development.
Monday, 17 January 2011

© 2011 - The Edge Singapore

Raffles Education: 200dMA resistance again.

A white spinning top formed today as volume expanded. Price closed at 30c, resisted by the declining 200dMA, after touching a high of 30.5c. 200dMA is still a formidable resistance.

The MFI and RSI are still in overbought territory while the OBV rose further. Momentum is still positive as suggested by the rising MACD in positive territory. With the MFI and RSI overbought, a pull back could take place soon. In such an instance, expect immediate support at 28.5c followed by 27.5c.

However, if volume should expand as the bulls try to push price higher, resistance provided by the 200dMA could be overcome and, in time, we could see price retest the high of 34c achieved in July last year.

Related post:
Raffles Education: Resistance at 200dMA. 

Singapore’s bankruptcies fall to lowest since 1996: Update 1
Monday, 17 January 2011

© 2011 - The Edge Singapore

CapitaMalls Asia: A sustainable reversal?

This counter formed a white spinning top today as it broke resistance at $1.95 to touch a high of $1.97, which is where the declining 50dMA is approximating. Of course, a spinning top is a sign of indecision and it was on the back of increased volume. It is not a strong bullish sign. The tug of war between bulls and bears is still significant here.

The uptrend which started on 20 Dec is still valid and the trendline support is at $1.89. With the 20dMA at $1.90, this is where we would find initial support in case of a pull back in price. This support should hold and if it does, we could be looking at an ascending triangle pattern. This would give me a target close to where the 100d and 200d MAs are at, approximating $2.08 and $2.10 currently.

OBV continues to climb, suggesting continuing accumulation. MACD has risen once more above the signal line and could be ready to cross into positive territory. The MFI and RSI are both rising after successfully testing 50% as support. Things are looking good here and I would accumulate on weakness.

Related post:
CapitaMalls Asia: $1.90 resistance turned support.

Golden Agriculture: Short term uptrend broken.

The negative divergence between the rising share price and falling MACD which we have observed for weeks is showing its colors. Price broke support at 78.5c provided by the 20dMA on 10 Jan and, in the last session, fell to test support at 76c provided by the rising 50dMA.

Price falling below the 20dMA suggests that the shorter term uptrend could be over. Drawing a trendline support linking the lows of 8 Oct and 24 Nov verifies this as price closed below this support for the first time in months.

How low could the price fall to? No one can say for sure but drawing a trendline support linking the lows of 30 Sep and 8 Oct coincides with the rising 100dMA and, to me, this suggests a much stronger support at this level and would be a more ideal entry point. The 100dMA is currently at 68.5c.

Fundamentally, I believe that demand for Crude Palm Oil would remain strong with higher consumption in Asia. I would look out for a chance to accumulate on any sharp pullbacks.

Related post:
Golden Agriculture (3 Jan 11)

CapitaMalls Asia: $1.90 resistance turned support.

CapitaMalls Asia's $1.90 former resistance was tested today as support. A resistance once broken could become support but this always needs confirmation. Today, we have confirmation. My buy queue at $1.90 was filled.  This was a smallish transaction which I see as a hedge in case $1.90 held up as support.  This is a case of averaging up as my original long position was bought at $1.85 earlier on as the share price formed a bottom.

Usually, once support is confirmed, we would see more people buying in as they feel more confident. However, buying at support might not be available by then and any buying would be done at higher prices. With price closing once again at $1.92 after touching a high of $1.93, let us see how things turn out next week. Expect initial resistance at $1.95.

Related post:
CapitaMalls Asia: Plague, no more?

Healthway Medical: Back at support.

On 20 Dec, I said "Healthway Medical closed the gap today at 15.5c. Am I expecting more downside? Share price is pulling back from almost overbought conditions and I do not expect any huge downward movement. Notice that the decline in share price has been on the back of reducing volume." Price closed at 15.5c support yet again today.

The MACD is approaching zero. Would it recover or would it cross into negative territory? The MFI has emerged from oversold territory and is rising gently, suggesting a return of demand, although weak. Volume has been relatively low.

The RSI has been forming higher lows which suggest a strengthening in terms of buying momentum based purely on price. The OBV is flat which suggests a lack of distribution and accumulation. Verdict? This counter seems to be consolidating and, at this point, it could go either way. I am not doing anything here.

Related post:
Healthway Medical: Closed the gap at 15.5c.

AIMS AMP Capital Industrial REIT: Sell down at 21.5c.

Someone asked me if I knew why there was heavy selling down of this REIT today. I do not have the answer. Checking the time and sale, 8,987 lots were sold down at 4.58pm, wiping out the entire buy queue. The OBV plunged yet again, indicating heavy distribution activity.

22c is, once again, resistance and immediate support is at 21.5c.

I will continue to accumulate at 21.5c and, perhaps, even 21c if the 200dMA should be tested as support. Fundamentally, buying more at 21.5c and 21c would give a handsome yield of 9.3 to 9.5%.

Choose Singapore REITs over developers: UOB KayHian
Friday, 14 January 2011

© 2011 - The Edge Singapore

Related post:
AIMS AMP Capital Industrial REIT: 22c support.

Old Chang Kee: Filling not enough.

We do not have to be housewives shopping for the family to know that prices of foodstuff are going up. I like buying the occasional curry puff from Old Chang Kee and today I found out that the curry puff is S$1.30 each! I thought it was still S$1.20 each. Anyway, I had a craving. What to do?

Back in the office, I happily took a bite and I bit into a cavity! Looking into the curry puff, I found it half empty! Really, I am not kidding. I took photos of the errant curry puff:

I was somewhat unhappy and amused as well. The price went up and the amount of filling reduced at the same time! What a combination! Maybe, I should buy Old Chang Kee's shares? Perhaps, this experience is an important part of FA. ;-p

CapitaMalls Asia: Plague, no more?

CapitaMalls Asia has broken out of its downtrend, closing at $1.92, two bids above resistance at $1.90. Volume increased as price strengthened.

We see a buy signal on the MACD histogram as both the MFI and RSI bounced off 50% support. OBV has turned higher, suggesting increased accumulation. More upside is likely.

The next resistance is a band between $1.95 and $1.98, as defined by the upper Bollinger, the candlestick resistance of end December 2010 and the descending 50dMA. Successfully overcoming this resistance band could see price going higher to where we find the 100d and 200d MAs.  These are now at $2.08 and $2.10 respectively.

Related post:
CapitaMalls Asia: Plagued by downtrend.

Saizen REIT: Golden crosses.

In technical analysis, some look out for the true golden cross which is the 100dMA crossing the 200dMA, going upwards. This is said to be more significant than the 20dMA or the 50dMA crossing the 200dMA as it signifies longer term strength in a counter's price moving upwards.

For Saizen REIT, the 100dMA seems on track to forming a golden cross with the 200dMA although it could be another couple of weeks before it is clearer. That there has been gradual accumulation since mid November 2010 is quite clear from the OBV. The MFI and RSI are above 50% but not overbought. Price could move higher in a nascent uptrend but it could be quite gradual as well.

Related post:
Saizen REIT (3 Jan 11)

S-REIT sector not attractive?

I read that JPMorgan says "valuations are no longer compelling as S-REITs are trading at a forward dividend yield of 6.0%, P/B of 1.1X and 7.5% premium to house NPV estimates."


JPMorgan singled out 2 REITs for comment:

Cuts CapitaCommercial Trust to Underweight vs Neutral on lack of growth, deteriorating portfolio quality and rich valuation. 
 

Cuts CapitaMall Trust to Neutral vs Overweight "as we believe that constant cash calls from the sector would put pressure on the stock."

I am vested in neither one. As with stocks, there will be better counters to be vested in and the ones to avoid. Broader strategy towards S-REITs stays the same for me. Stay vested in S-REITs with higher yields, trading at a discount to NAV and with relatively low gearing.

S-REIT valuations no longer compelling - JPMorgan
Wednesday, 12 January 2011

© 2011 - The Edge Singapore

Hock Lian Seng: Running out of gas?

This counter had been sleeping for some time. Yesterday, it stirred, forming a wickless white candle on the back of higher volume. The bullish candlestick followed through today as price touched a high of 33.5c before closing at 32c, forming a very long upper wick in the process. 32c, thus, remains a formidable resistance with some history backing it.

Although the OBV shows sharp accumulation, both MFI and RSI are in their overbought regions. Price could have moved up too much and too quickly. In case of a pullback, I expect strong support to be found at 30c. Any attempt by the counter to move higher in price could see selling pressure once again as people who bought at 33c might try to break even and get out of what might have been a hasty buy decision.

"If price tests 29c, I would buy more. 29c is also where we find the 138.2% Fibo line. This should lend support in case of retracement." Buying more at 29c almost three months ago has proven to be a good decision.

Related post:
Hock Lian Seng: Buying more?

First REIT: Simply amazing.

If it simply amazing how this REIT's price is pushing higher by the day. How much higher could it go? Why did it touch a high of 77c on 2 occasions and did not go higher?

Well, if we draw a set of Fibo lines, it becomes clear why 77c is resistance. It is where we find the 123.6% Fibo line. However, 23.6% is not a golden ratio and we could expect stronger resistance to be found at 78.5c which is where we would find the 138.2% Fibo line.

Of course, with both the RSI and MFI in overbought territories, we would not be wrong to question if the upward movement could continue. Although the OBV shows no sign of accumulation ending, we could see a pull back to correct the overbought condition. In such an instance, I expect 75c to be resistance turned immediate support.

I still have a fair value of 80c for this REIT based on FA.

Unaudited financial results of First REIT for the fourth quarter and full year ended 31 December 2010 will be announced on Friday, 21 January 2011.
Related post:
First REIT: Retesting high at 75c.

CapitaMalls Asia: Plagued by downtrend.

It is quite obvious that CapitaMalls Asia is still in a downtrend. Macquarie just upgraded it to Outperform from Neutral and raised its target price to $2.24 from $2.19. Will this give this counter the much needed push to break out of its downtrend?

Technically, the counter's price formed a higher low on 4 Jan. This is somewhat encouraging as it has not done so since starting its current decline on 6 Oct 10. Since forming a white candle on 5 Jan, its price has been hovering at $1.88, resisted by the 20dMA.

MFI is now at 50% which could act as a support. RSI is now at its trendline support. Will the supports hold? The MACD, although above the signal line, is still in negative territory. This counter is currently at a crossroad.

Closing above $1.90 would signal a breakout from the downtrend while breaking below $1.88 would signal the collapse of immediate support and price could retest the $1.83 lows. Good luck to fellow shareholders.

Macquarie upgrades CapitaMalls Asia to Outperform. The house reckons “the current weakness is a buying opportunity in a retail powerhouse in Asia.” Notes, CMA invested or committed more than $1.65 billion in four projects in 2H10, ahead of its internal targets; mall developer and owner offers exposure to more than 90 retail malls across five countries in Asia. 
Wednesday, 12 January 2011

© 2011 - The Edge Singapore

Related post:
CapitaMalls Asia: Eyeing $1.83.

AIMS AMP Capital Industrial REIT: 22c support.

Unlike China Hongxing I blogged about just now, AIMS AMP Capital Industrial REIT is something I am heavily vested in. The investment decision was made based on the REIT's sound fundamentals and relatively high yield. I also like what the technicals are telling me now.

Today, I received an email from a reader asking if the high volume is a sign of some big boys slugging it out. I don't know, of course. However, if we check the trade summary, there are about 4.1m units bought up and 4.1m units sold down throughout the day. Of course, almost 5m units changed hands before the market opened at 8.35am. Price? All at 22c. I shan't bother trying to guess what is happening behind the scenes as that would probably just give me a headache and more white hair. Totally unproductive.

However, technically, the charts show that the trendline resistance, which is at 22.5c, remains unbroken. Support remains at 22c. That the support is still holding up despite a much higher volume on a black candle day, with obvious ongoing distribution which is easily seen in a plunging OBV, is very encouraging. Support is strong.

The MFI plunged but is still above its trendline support. The MACD, which broke out of its downtrend some sessions back, is still in positive territory and above the signal line. We want to see the MFI bouncing off its support and the MACD turning up once more. If these happen, resistance at 22.5c would, more likely than not, break in time and we could see the high of 23.5c tested eventually.

Notice:
The unaudited financial results for third quarter ended 31 December 2010 will be released on 25 January 2011, after market close.
Related post:
AIMS AMP Capital Industrial REIT: Firm support.

Back in Singapore and China Hongxing.

I am back from a short holiday. Feeling somewhat exhausted. Probably got much more sun and walking than I am used to in Singapore but I guess it is not a bad thing. If you are wondering where did I go, I went on a cruise with my parents on the Star Virgo. Very enjoyable, as usual, but the internet connection sucks.

The internet connection on the ship is via satellite and it took 5 minutes to load a page! The service was charged at 23c per minute. So, imagine how costly it would be if I were to log on for an hour and, of course, would get to see about 12 pages only! Anyway, I am back at home now and thankful for my ADSL modem.

I am blogging about China Hongxing simply because I received two comments on this counter while I was away. I am not vested.

The wickless white candle formed on 7 Jan was very bullish but there was no follow through and on 10 Jan (Monday), a doji was formed on the back of high volume, signalling indecision. However, the fact that price did not fall below the immediate support provided by the 100dMA at 17.5c  was encouraging. The bears did not win the battle.

In the following two sessions, dragonfly dojis were formed on low volume. Both bulls and bears are being cautious. So, good time to go long? Well, the higher lows on the MACD, MFI and RSI are obvious. There is positive momentum. RSI is overbought but that could stay overbought for a while more especially as we do not see the MFI in overbought territory. Look at the OBV and we do not see any distribution.

In case price breaks immediate support at 17.5c, a longer term and stronger support is at 15.5c. This is where the rising 200dMA is approximating and it is also where the trendline support is found. 15.5c could provide a much nicer entry level for long only traders. Of course, a further strengthening in price could still see 20c tested.

Related post:
China Hongxing: Eyeing 20c.

China Hongxing: Eyeing 20c.

One blog post for the road. :)

I have not had much luck with China Hongxing, having lost some money trading this counter twice in the last few months. I am no longer vested and it seems that things are looking up for this counter. In the last session, China Hongxing broke resistance at 17.5c. This was after closing above the 17c neckline of what is now clearly a double bottom formation on 4 January.

The OBV shows gradual accumulation while the momentum oscillators are all rising. The MACD is rising in positive territory, indicating the return of positive momentum. A higher low on the MFI as it continues to rise suggests firm demand although the RSI has risen into overbought territory. Continuing upmove in price with higher volume could see it test resistance at 20c eventually while 17.5 is immediate support in case of a pull back. Good luck to all who are vested.

First REIT: Retesting high at 75c.

Today, First REIT hit a high of 75.5c before retreating to 75c, the high achieved on 2 and 3 Dec 10, adjusted for the recent rights issue. OBV shows ongoing accumulation while the MFI shows firm demand. The RSI has entered overbought territory but in very sanguine circumstances, it could stay overbought for a while more.

71c was a many times tested resistance which should turn strong support. It is also where we find the 50d and 20d MAs approximating. The 20dMA is also poised to form a golden cross with the 50dMA at this price level. Anyone who bought more units of First REIT, confident of its sound fundamentals during its recent troubled rights issue is now amply rewarded.

Could this REIT's unit price go higher? Your guess is as good as mine but you might remember that I have a fair value estimate of 80c per unit for this REIT. Apparently, OCBC Research thinks it is worth much more with a fair value of 84c per unit. The listed positives are:

1. Good quality assets.

2. Strong and committed sponsor.

3. Steady and sustainable income.

4. Potential upside.

Read the report at http://www.remisiers.org/cms_images/First_REIT-110107-OIR.pdf

Related post:
First REIT: Excess rights not enough.

Raffles Education: Resistance at 200dMA.

Raffles Education extended gains yesterday and closed at 30c, the resistance provided by the 200dMA. A wickless white candle was formed on the back of increased volume. OBV rose steeply, signalling accumulation. MACD rose into positive territory, signalling the return of positive momentum.

MFI and RSI rose higher, crossing into overbought territories. Although signalling heightened demand and positive buying momentum, the indices, being in overbought regions, suggested that further gains could be limited. This panned out today.

A doji was formed today, suggesting indecision. Although the momentum oscillators continue to rise, the OBV has flattened, signalling a stop to accumulation. The explosive rise in price could be at an end. Pull back could find support at 27.5c and 26.5c, as provided by the 100d and 50d MAs, respectively.

Related post:
Raffles Education: Sold at 27.5c resistance.

Raffles Education +5.5%; buybacks give confidence - Kim Eng
Thursday, 06 January 2011

© 2011 - The Edge Singapore

FSL Trust: Sold some at 48c.

Yesterday, I reduced my long position in FSL Trust at 48c, locking in some gains. You might remember that I sold some on 30 Dec at 47c. Then, I mentioned that "In a benign situation, I expect gap resistance at 46c to become support in the near term. This is further strengthened by the uptrend support line. Technically, the worst seems to be over for FSL Trust and a retest of resistance at 48.5c looks likely in time." 48c is just one bid away from 48.5c and selling some at 48c is a hedge in case price weakens.

A doji was formed yesterday, suggesting indecision, while the uptrending MFI broke its support when it emerged from the overbought territory a day earlier. Encouraging though some technicals might be with the MACD continuing to rise and the OBV showing no signs of distribution, the RSI was way overbought.

My long position in FSL is for a trade and the entry was not based on fundamentals, which are lacking. So, reducing my long position, locking in gains at resistance and at signs of weakening demand, at least partially, is prudent although it could limit gains in case of further price appreciation.

Today, 48c remains the resistance as a gravestone doji was formed. The stalemate between bulls and bears is obvious but it seems as if the bulls are tiring. Further upside seems difficult and could be limited to a retest of the high of 48.5c touched on 21 Oct 10. A pull back would see immediate support at 46c which is also where the 20dMA is rising to form a golden cross with the declining 200dMA.

Related post:
FSL Trust: Sold some at 47c.

What are the charts forecasting for 2011?

When I initially started out on Technical Analysis, I would see how seasoned chartists like Michael Kahn, Goola Warden and Daryl Guppy read the charts. So, I am excited that Daryl Guppy will be sharing his views on the stock market outlook for Singapore investors in 2011 very soon.

Daryl Guppy is a regular commentator on CNBC Asia and is known as 'The Chartman'. He is recognized globally for the quality of his analysis. He actively trades equities and associated derivatives markets. Daryl has also developed several leading technical indicators used by traders, and is recognized as an expert on China markets.

We can also learn how to use SiMSCI warrants to take a leveraged view on the Singapore market without the need to stock pick.

Register today at 
http://www.warrants.com.sg/en/seminar/seminar_e.cgi

More on SiMSCI warrants at
http://singaporeanstocksinvestor.blogspot.com/2010/11/best-way-to-trade-singapore-index.html

ADVERTORIAL

AIMS AMP Capital Industrial REIT: Firm support.

The last time I blogged about this REIT was on 29 Dec and I mentioned the rising MACD. This is still valid today. The MACD is rising gently and seems on the verge of crossing into positive territory. With the longer term 100d and 200d MAs both rising, it would seem to be a matter of time before the resistance at the 50dMA is taken out. This is at 22c.

The MFI has been forming higher lows and would be testing 50% once more. If it overcomes this, it would mean an expansion in volume at the current price of 22c or higher. This is one counter that has very limited downside and a nice probability of trading to 25c (for an 8% yield). In the meantime, at 22c, its distribution yield is about 9.1%. I am accumulating.

Related post:
AIMS AMP Capital Industrial REIT: Rising MACD.

Raffles Education: Sold at 27.5c resistance.

On Monday, 3 Jan 2011, I mentioned "Raffles Education is rebounding in earnest. The MACD broke out of its downtrend and is rising while the MFI and RSI show positive momentum. OBV shows accumulation. Immediate resistance at 26c.  This is followed by 26.5 which is where we find the declining 50dMA. The most formidable resistance is probably provided by the 100dMA which is at 27.5c. The last time price tested the 100dMA was on 21 Sep 2010. For anyone looking to reduce exposure, selling at resistance in a downtrend is conventional wisdom."

Today, Raffles Education broke out of its downtrend which coincides with the declining 50dMA at 26.5c. This was on the back of higher volume. Closing at 27.5c is at resistance provided by the declining 100dMA. An intra day high of 28c was achieved, however, and if volume continues to expand with an upward push in price, the next significant resistance level is at 30c, which is where we find the declining 200dMA.

Could I have been too hasty in selling off my money losing position initiated a couple of months ago? I do not know but I recognise that, downtrend notwithstanding, the 100dMA has been the limit of any rebound the counter has staged for the last 12 months. Could it be different this time? Of course, it could be but this being purely a trade, I chose to follow conventional wisdom.

Tea with AK71: Uncles fight on SBS bus.

I thought this only happens in Hong Kong.



I think I have taken the same bus service from Orchard Road to Chinatown before. I remember that the bus was mostly filled with senior citizens. I would never have thought such a scene probable.  Really, I mean these are not teenagers from 369, right? Does SBS have a service number 369?

NOL: Full steam ahead.

NOL tested its high of $2.35 touched in April 2010. The difference is that in April, it was a black candle and in the last session, it was a white candle. I like what I see in the OBV. It has been placid since early November 2010 as price went on to form two dips. No visible distribution. The weaker holders were being shaken out.

Taking the lows of $2.02 and $2.12, using $2.24 as the neckline gives me two targets at $2.36 and $2.46. $2.35 is only 1c shy of $2.36. I expect $2.46 to be attainable if volume continues to expand on upmoves. Having said this, price climbs a wall of worries and the MFI and RSI are bordering on overbought. It would make sense to divest partially and take some profit at resistance. Good luck to all NOL shareholders.

Credit Suisse rates Asia container shipping sector Overweight; Likes NOL
Tuesday, 04 January 2011

© 2011 - The Edge Singapore

CapitaMalls Asia: Eyeing $1.83.

As mentioned in my last post, I am keeping an eye on CapitaMalls Asia. Price formed a wickless black candle today as it closed at $1.87 on higher volume. Support was established at $1.83 and it would be interesting to see if this would be tested in the next couple of sessions. If tested on lower volume, it could possibly signal the formation of a bottom.

Coupled with a lower volume, we want to see the MACD forming a higher low and the MFI keeping above its trendline support. We would then have the ingredients for a possible reversal. As of now, the downtrend is still intact and if downward movement in price continues with higher volume, things could turn ugly.

CapitaMalls may spend $2b  on new projects this year
Tuesday, 04 January 2011

© 2011 - The Edge Singapore

Capricorn effect, Golden Agriculture, CapitaMalls Asia, Raffles Education and Saizen REIT.

The mountain trekking herbivore did not disappoint as it showed its presence today, sending the STI up by 1.4%. Stock markets in Europe are also higher. "The biggest Asian markets closed higher, as investor confidence was boosted by signs that China's efforts at keeping a lid on inflation may be working....Hong Kong's Hang Seng index rose 400.60 points, or 1.7 percent, to close at 23,436.05, while the South Korean Kospi rose 19.08 points, or 0.9 percent, to finish at 2,070.80." Read article here.

Golden Agriculture moved higher to close at 82c today. Volume although higher is still quite modest. Nonetheless, the bullish crossover on the MACD, breaking out of its downtrend, is encouraging.  The OBV shows continual accumulation while the RSI shows positive momentum.  The MFI, however, has declined below 50%.  MFI is a function of price and volume and the decline reinforces the picture of negative divergence. Support for Golden Agriculture is now a band between 78c to 80c.

CapitaMalls Asia retreated from $1.95 where we find the downtrend resistance line. The counter's downtrend is intact. At the closing price of $1.91, it is supported by the 20dMA. If the support at the 20dMA were to be compromised, the low of $1.83 would be critical as a measure of whether the counter could reverse from its downtrend or go lower. I would keep an eye on the MFI. With a reduction in price and/or volume, the MFI could retest its support.

Raffles Education is rebounding in earnest. The MACD broke out of its downtrend and is rising while the MFI and RSI show positive momentum. OBV shows accumulation. Immediate resistance at 26c.  This is followed by 26.5 which is where we find the declining 50dMA. The most formidable resistance is probably provided by the 100dMA which is at 27.5c. The last time price tested the 100dMA was on 21 Sep 2010. For anyone looking to reduce exposure, selling at resistance in a downtrend is conventional wisdom.

Saizen REIT saw some buying up activity today. Volume achieved was the highest in 3 months on a white candle day. The MACD shows that momentum is positive and improving. OBV shows gradual accumulation. Immediate resistance is at 17c while 17.5c is the top of a basing process that started in April 2010. We could experience strong resistance at 17.5c if ever tested. With the next distribution in March 2011 and probable positive catalyst from the refinancing of YK Shintoku, there is more upside potential for this REIT.

STI rises 1.4% to 3,235.77 at closing.

First Real Estate Investment Trust jumped 2.1% to 72 cents, a four-week high. Singapore’s first health-care property trust said it completed the purchase of two Indonesian medical centers, boosting assets under management to $612.8 million. It said it’s aiming for a $1 billion portfolio in two to three years.

Monday, 03 January 2011

© 2011 - The Edge Singapore

SRS: E-book and a brief analysis.

UPDATE (YA 2018):
Taxpayers who make SRS contributions on or after 1 Jan 2017 should note that the overall personal income tax relief cap of $80,000 applies from YA 2018 (when the income earned in 2017 is assessed to tax).
Read: SRS INCOME TAX RELIEF.
Feb 16, 2017
See examples:
https://www.iras.gov.sg/irashome/Individuals/Locals/Working-Out-Your-Taxes/Deductions-for-Individuals--Reliefs--Expenses--Donations-/#title7



----------------------------

SRS e-book

Recently, I came across a couple of blogs talking about the Supplementary Retirement Scheme (SRS). 

Over the years, whenever I talked about how I started an SRS account from the time the scheme was introduced in 2001, listeners would be incredulous. I was only 30 years old in 2001. To me, the tax benefit was too obvious to be ignored. Since 2001, I have contributed to my SRS account up to the maximum sum allowed yearly.




In a blog post on 24 Dec 2009, I mentioned that "As long as a person is paying income tax, he should start an SRS account and contribute to it yearly so that he pays less income tax (or none at all). For me, it's that simple." 

Well, it might be that simple for me but for people with many financial commitments, it might not be so. For these people, they might not have much money leftover after taking care of all their routine expenses. So, voluntary contributions to the SRS account could be difficult.

Having said this, as long as we are paying income tax, voluntary contributions to our SRS accounts should be viewed as an important part of planning for our retirement. We should try to include it in our retirement planning.






Voluntary cash contributions to the SRS account are eligible for tax relief. For some, contributing just a few thousand dollars a year could mean not having to pay any income tax. So, there is no need to contribute the maximum of S$11,475 per annum. This is the maximum allowed for Singaporeans and PRs.

Therefore, I would suggest that we look at how much of our income is taxable and to contribute to the SRS account sufficiently to become free from income tax. After all, funds in the SRS account should not be withdrawn till the statutory retirement age to avoid penalties. So, cash in hand is still better than being in the SRS account.




Of course, if our taxable income is much higher, contributing the maximum sum allowed would save us much in income tax although it might not mean being free from income tax. How much to contribute, if ability allows, therefore, depends on individual income levels.

Money in the SRS account could be used to invest for higher returns. Examples are fixed deposits, single premium insurance policies, shares, REITs, ETFs and unit trusts. SRS funds cannot be used for purchasing real estate, for example.







Upon reaching the statutory retirement age of 62, if we had been making regular contributions and investing prudently, money in our SRS accounts could be an important part of our retirement income. 50% of the funds withdrawn upon retirement would be subject to income tax. If we keep our yearly withdrawal within the non-taxable bracket which I believe is $20K, we would not even have to pay any income tax.

So, theoretically, if we had $200K or less in our SRS accounts by the time we retire, withdrawals could be non-taxable. Withdrawing the funds in ten equal portions over a period of ten years would lower the income tax payable if we had more than $200K in our SRS accounts by the time we retire.

For anyone paying income tax yearly and still wondering if the SRS is necessary, do consider the points I have made in this blog post. Financial security in our old age is one of the most important things we have to plan for in life.




UPDATE (18 July 2014):
The maximum contribution allowed for the SRS account now is $12,750 per annum.

NEW: From 2016, max contribution is $15,300.

Read Supplementary Retirement Scheme.
Updated Booklet on the SRS: HERE.

From the FAQ section on SRS in MOF's website.

Update:
"... the caps on contributions to the Supplementary Retirement Scheme will also be raised to $15,300 for Singapore citizens and permanent residents and $35,700 for foreigners."Source: The Straits Times, 23 Feb 15.

Related post: Double your income, not your income tax.

A movie: Pirates of the Caribbean 4.

I just came across this. When I watched part 3, I was wondering if there would be a part 4. I enjoyed all three parts so far and Johnny Depp is one of the best actors around. He is Captain Jack Sparrow.  I cannot imagine anyone else in the role. Part 4, I will have to watch. Enjoy the trailer: