| | | | | Commentary | | The Straits Times index was flat on Wednesday. The index is above its 20d MA (@ 3200) and above its 50d MA (@ 3174). 53% of the index constituents are above their 20D MA (vs 50% the previous session) and 53% of the shares are above their 50D MA (vs 60%). On a daily basis, the index is posting a pullback and is expected to test the support of its 20-day and 50-day moving averages. The relative strength index is turning down but still remains above its neutrality area at 50. Even though a continuation of the consolidation in current stage cannot be ruled out, its extent should be limited. As long as 3185 holds as the key support, further upside is expected. The HSI index fell 0.17% or 42.31pts to 25293.63 (day range: 25374.95 - 25245.44) on Wednesday. The index is above its 20d MA (@ 24648) and above its 50d MA (@ 24320). 70% of the index constituents are above their 20D MA (vs 70% the previous session) and 72% of the shares are above their 50D MA (vs 67%). On the daily chart, the index has broken above its upper Bollinger band, and is surging for a higher top. The 20-day moving average stays firmly above the 50-day moving average, and the daily relative strength index is above its neutrality area at 50, showing strong upward momentum. To conclude, our ST bias should remain positive. |
| Straits Times Intraday: the downside prevails. | | Pivot: 3239.00
Our preference: short positions below 3239.00 with targets at 3200.00 & 3180.00 in extension.
Alternative scenario: above 3239.00 look for further upside with 3255.00 & 3275.00 as targets.
Comment: technically the RSI is below its neutrality area at 50.
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| | | | | Opinion published is a ST (short-term) view. Green Lines Represent Resistance | Red Represents Support Levels | Light Blue is a Pivot Point | Black represents the price when the report was produced | | Associated Warrants for Straits Times |
| Type | Strike | Expiry | Delta | Ticker | Issuer | Name | Risk | Conv ratio | Eff. Gearing | | Put | 3050.00 | 31/08/2017 | -0.5 | CFWW | Macquarie Bank | STI MBL EPW170831% | Low risk | 2500.0 % | 15.6 % | | Put | 3050.00 | 31/08/2017 | -0.5 | CFWW | Macquarie Bank | STI MBL EPW170831% | Low risk | 2500.0 % | 15.6 % | | Call | 3300.00 | 31/08/2017 | 0.3 | CFVW | Macquarie Bank | STI MBL ECW170831% | Medium risk | 2500.0 % | 7.4 % | | Call | 3300.00 | 31/08/2017 | 0.3 | CFVW | Macquarie Bank | STI MBL ECW170831% | Medium risk | 2500.0 % | 7.4 % |
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| Hang Seng Intraday: key resistance at 25420. | | Pivot: 25420
Our preference: short positions below 25420 with targets at 25100 & 25000 in extension.
Alternative scenario: above 25420 look for further upside with 25600 & 25730 as targets.
Comment: the RSI advocates for further downside.
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| | | | | Opinion published is a ST (short-term) view. Green Lines Represent Resistance | Red Represents Support Levels | Light Blue is a Pivot Point | Black represents the price when the report was produced | | Associated Warrants for Hang Seng |
| Type | Strike | Expiry | Delta | Ticker | Issuer | Name | Risk | Conv ratio | Eff. Gearing | | Put | 24400.00 | 28/07/2017 | -0.4 | CGSW | Macquarie Bank | HSI MBL EPW170728% | High risk | 1000.0 % | 14.9 % | | Put | 24400.00 | 28/07/2017 | -0.4 | CGSW | Macquarie Bank | HSI MBL EPW170728% | High risk | 1000.0 % | 14.9 % | | Put | 24400.00 | 28/07/2017 | -0.4 | CGSW | Macquarie Bank | HSI MBL EPW170728% | High risk | 1000.0 % | 14.9 % | | Call | 25800.00 | 28/07/2017 | 0.4 | CGYW | Macquarie Bank | HSI MBL ECW170728% | High risk | 1000.0 % | 18.4 % | | Call | 25200.00 | 29/06/2017 | 0.5 | CGIW | Macquarie Bank | HSI MBL ECW170629% | Medium risk | 1000.0 % | 19.8 % | | Call | 25000.00 | 28/07/2017 | 0.5 | CGRW | Macquarie Bank | HSI MBL ECW170728% | Medium risk | 1000.0 % | 15.2 % |
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| OCBC Intraday: under pressure. | | Pivot: 10.50
Our preference: short positions below 10.50 with targets at 10.25 & 10.11 in extension.
Alternative scenario: above 10.50 look for further upside with 10.65 & 10.81 as targets.
Comment: technically the RSI is below its neutrality area at 50.
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| | | | | Opinion published is a ST (short-term) view. Green Lines Represent Resistance | Red Represents Support Levels | Light Blue is a Pivot Point | Black represents the price when the report was produced | | Associated Warrants for OCBC |
| Type | Strike | Expiry | Delta | Ticker | Issuer | Name | Risk | Conv ratio | Eff. Gearing | | Put | 9.50 | 13/11/2017 | -0.4 | CGWW | Macquarie Bank | OVERSEA-CHINESE BANKING CORP MBL EPW171113% | Medium risk | 9.0 % | 8.7 % | | Put | 9.50 | 13/11/2017 | -0.4 | CGWW | Macquarie Bank | OVERSEA-CHINESE BANKING CORP MBL EPW171113% | Medium risk | 9.0 % | 8.7 % | | Call | 9.50 | 02/10/2017 | 0.6 | CBHW | Macquarie Bank | OVERSEA-CHINESE BANKING CORP MBL ECW171002% | Low risk | 7.0 % | 6.5 % | | Call | 10.20 | 13/11/2017 | 0.5 | CGMW | Macquarie Bank | OVERSEA-CHINESE BANKING CORP MBL ECW171113% | Low risk | 9.0 % | 7.3 % |
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| MA (50) & MA (20): The most simple trend indicators are Moving Averages. They simply correspond to an average calculated on an evolving time scale (20 and 50 periods): every day, the oldest value (often taken at the close) in the average calculus is replaced by the value of the new session.
Bollinger bands: are represented by 3 different bands and are derived from moving averages. The middle band corresponds to a simple moving average (MA (20)). The level of the upper band, in every point, corresponds to the sum of the level of the middle band and twice the value of the standard deviation associated to the 20-day moving average. Reciprocally, the level of the lower band corresponds to the level of the middle band diminished by twice the value of the standard deviation associated to the 20-day moving average. An envelop of the stock price is thus determined. This makes it possible to then identify the variation margin in which the stock should stay almost systematically. In the case of a stock following a Gauss law, 95 % of the trades will thus occur between these bands.
RSI (14): the Relative Strength Index aims at establishing a reference scale independently from the stock prices levels themselves. As the RSI has boundaries (0 and 100), it then becomes very easy to determine overbought (above 70) and oversold (below 30) areas. In addition, just as on prices themselves, supports and resistances can appear, especially when nearing the neutrality zone (near 50). Thus, the RSI is one of the most commonly used counter-trend indicators.
It is based on the average of rises and drops of price, with the formula:
RSI = 100 - [100 / (1 + RS)]
Where RS represents the average of up closes divided by the average of down closes on the considered period (14). | |
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