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The Singapore market absorbed a number of meaningful intra-day corrections last week to post strong gains on the back of pent up buying of blue chips by investors and funds which had missed the rally. A number of comments made to me tell the tale - from a fellow golfer "the Singapore market is up 50% and I didnt make a cent - is there any stock I can buy now ?"; from a retail investor - "I missed the blue chip rally but am jumping into the penny caps now as they are laggards"; or from a professional investor "can I buy the Singapore banks now they are trading close to 1 time book - my downside must be limited'. For me, I fall into another group of investors who came in when the markets were selling off but came out after making 20-30% only to see the stocks rise further for a 70-100% gain. I have also heard from my wife that more housewifes and retail punters are in ?
Let's get back to basics first - this rally is powerful and caught many by surprise. I think the rally has been too sharp and so some profit taking is due (see RSI of STI Index below). I would welcome the views of technically oriented investors on what kind of magnitude of correction we can expect. Some have told me that the correction should be to the previous resistance which appears in the chart below to be around 1920 to 2000 (again I would welcome technical views as this is not my expertise. Read more...[caption id="attachment_1567" align="alignright" width="150" caption="Photo by ~yienshawn92~"][/caption]
The Singapore market absorbed a number of meaningful intra-day corrections last week to post strong gains on the back of pent up buying of blue chips by investors and funds which had missed the rally. A number of comments made to me tell the tale - from a fellow golfer "the Singapore market is up 50% and I didnt make a cent - is there any stock I can buy now ?"; from a retail investor - "I missed the blue chip rally but am jumping into the penny caps now as they are laggards"; or from a professional investor "can I buy the Singapore banks now they are trading close to 1 time book - my downside must be limited'. For me, I fall into another group of investors who came in when the markets were selling off but came out after making 20-30% only to see the stocks rise further for a 70-100% gain. I have also heard from my wife that more housewifes and retail punters are in ?
Let's get back to basics first - this rally is powerful and caught many by surprise. I think the rally has been too sharp and so some profit taking is due (see RSI of STI Index below). I would welcome the views of technically oriented investors on what kind of magnitude of correction we can expect. Some have told me that the correction should be to the previous resistance which appears in the chart below to be around 1920 to 2000 (again I would welcome technical views as this is not my expertise. Read more...
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The Singapore market absorbed a number of meaningful intra-day corrections last week to post strong gains on the back of pent up buying of blue chips by investors and funds which had missed the rally. A number of comments made to me tell the tale - from a fellow golfer "the Singapore market is up 50% and I didnt make a cent - is there any stock I can buy now ?"; from a retail investor - "I missed the blue chip rally but am jumping into the penny caps now as they are laggards"; or from a professional investor "can I buy the Singapore banks now they are trading close to 1 time book - my downside must be limited'. For me, I fall into another group of investors who came in when the markets were selling off but came out after making 20-30% only to see the stocks rise further for a 70-100% gain. I have also heard from my wife that more housewifes and retail punters are in ?
Let's get back to basics first - this rally is powerful and caught many by surprise. I think the rally has been too sharp and so some profit taking is due (see RSI of STI Index below). I would welcome the views of technically oriented investors on what kind of magnitude of correction we can expect. Some have told me that the correction should be to the previous resistance which appears in the chart below to be around 1920 to 2000 (again I would welcome technical views as this is not my expertise. Read more...
