Weekend review

The market seems to rebound with some strength. A quick look at Dow reveals that it has made a new high. On to the STI side, it gap up from 3605 to close near 3652 with a bullish white belt-line which was a horizontal support level a few days ago and was also another horizontal resistance level even longer ago. This level can prove to be crucial in the near future as it can act as support since it has been tested for many times and that was something off the books that i read :) Overall, i would say STI rebounded with some strength but i am still not that optimistic when i factor in the volume consideration. Volume confirms price action and though volume was higher this time round as compared previous buying in, it was still lower compared to the last day of the sellout. I gotta see how STI breaks the crucial resistance level of 3652.

Some article in the last few pages of the Strait Times ( Not STI !) caught my attention a few days ago. Too lazy to find and repost the article and also to post some facts, but basically it talks about how penny stocks has been hogging the volume list. But i can still remember 2 crucial details about the article. Firstly, the trading volume for the penny stocks are much higher that what has been released to the market. It is like the company only released this amount of shares to the market but the daily trading volume is much higher than this amount of shares. Secondly, the valuation as determined by the prices of the share is much higher than how much the companies are worth and these companies are actually weak fundamentally. This of course leads to the conclusion and that is the market is mainly in the hands of speculators now. They are like your uncles or aunties or even students like me who buy without even knowing what they are buying in and got zlich idea abt the fundamentals of the companies. Well, i am already seeing on msn ppl trading stocks and posting on their target profits. Can't reli predict what will happen next man ..

Well this is like the last days of the bull market. The problem is that people has been calling for a correction a few months back and this bull market still goes on to making new highs. This post i made serve to remind me that it is always good to be cautious. I guess the greed of ppl noes no limit bah.

Spotted 2 potential counters

Pine Agritech : No reversal formation forming. Currently, a low-risk buy in at this level of support. Support of $0.59 has been tested 3 times and the current testing of the level for a 4th time resulted in a morning doji star which is very bullish. Could prove to be a double bottoms in the near future but such formations may not be formed ultimately going by my observations so far.



Noble Grp : Breakout from ascending triangle formation with high volume. OBV has been trending upwards steadily. Notice how there are 2 trendlines forming the bottoms of the ascending triangle but the general concept of the ascending triangle is that everytime the counter drops, the market is willing to buy in at a higher price, causing the counter to rise again thus showing bullishness. Current price maybe too high to buy in since the cut loss has to be set below the trendline so might have to buy on dips but den it might never dip so it is anyone's call.