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Sunday, August 26, 2012

Straits Times Index - Uptrend Getting Fatigue

There is evident from the STI chart that the uptrend established since June 4 is getting fatigue. Out of 30 components stocks of the index, 9 have sell signals, 12 hold, 7 hold ( trend weakened ) and only 2 buy. Details below :

Capitaland C31- Hold ( trend weakened )
CapitalMall C38U - Sell
CapitalMalls JS8 - Sell
CityDev C09 - Sell
ComfortDelGro C52 - Hold ( trend weakened )
DBS D05 - Hold
F&N F99 - Hold
Genting G13 - Buy
Golden Agri E5H - Buy
HKLandUS$ H78 - Hold
Jardine CC C07 - Hold ( trend weakened )
JMH400US$ J36 - Hold
JSH500US$ J37 - Hold ( trend weakened )
KepCorp BN4 - Hold
NOL N03 - Sell
Noble N21 - Hold
OCBC BK O39 - Hold ( trend weakened )
Olam O32 - Hold
SembCorp U96 - Hold
SembMar S51 - Hold
SIA Engg S59 - Hold ( trend weakened )
SPH T39 - Sell
ST Eng S63 - Hold
SingTel Z74 - Sell
SIA C6L - Hold ( trend weakened )
SGX S68 - Hold
Global Logistic Pro - Hold
Starhub CC3 - Sell
UOB U11 - Sell
Wilmar - Sell ( downtrend stock )

Notes :
Hold = If your entry was low and the stock is in-the-money. Continue to ride on the trend
Hold ( trend weakened ) = As above but the trend has weakened and sell signal may surfaced any time
Sell = Do not go long ( it does not imply you should go short though )
Buy = You may go long but should the index turn bearish you may need to exist as well

The Straits Times Index :

On the STI chart above, MACD has formed one dead cross and two "kiss of death" similar to the period between Feb 21 - May 3 before the index breakdown on May 4 when MACD crossover the zero line. MACD continues to trend down heading toward the zero line. The rate of ascend on the price chart has decelerated.  Aug 14 day's high failed to breach Aug 6 & 7 day's highs. Prices are now testing the uptrend line. 

There are enough caution signs from the above that the uptrend is weakening. When the uptrend line is violated and/or MACD crossover the zero line, do expect volatility to return.