STI - Trend reversal or correction?

The STI has come down quite sharply over the past few days. Will this be the start of a reversal in the uptrend or just a normal correction in the uptrend?

I attach a daily chart of the STI above for some simple technical analysis. The daily chart of the STI shows a steady uptrend since late May this year. It has steadily been making higher highs and higher lows. During the previous retracement in August, the STI retraced about 61.8%, and then proceeded to rally until 14 October. It has consolidated to about 61.8% fibonacci retracement. If the STI does not fall below the 61.8% mark (about 3100), then i would say that the uptrend is still intact. If history is to be a guide, the STI rebounded before reaching the 61.8% retracement. Let us see if this would be the case again. Also, the 50day moving average line also give a good indication of the STI's trend and looks like a good support level as well. During the previous retracement, notice that the STI did not really close below the 50day moving average. Now, the STI is approaching the 50day moving average. As long as the STI is able to close above the 50day moving average, i would say that the uptrend is still intact.

In my opinion, i would say that this appears to be a normal correction in an uptrend. But if the STI should breach the 61.8% fibonacci level or close below the 50day moving average, then the uptrend may have reversed and it may be time to pull out of long positions.

I will be watching the market closely and will update my thoughts on this blog if this should happen.

target for golden agri

Golden Agri-Resources Ltd is the world's second largest palm oil plantation with a total planted area of 433,200 hectares (including small holders) as at 30 June 2010, located in Indonesia. It has integrated operations focused on the production of palm-based edible oil and fat products.

Founded in 1996, GAR is listed on the Singapore Exchange since 1999 with a market capitalisation of US$5 billion as at 30 June 2010. Flambo International Ltd, an investment company, is GAR’s largest shareholder, with a 49% stake in the company. GAR has several subsidiaries, including PT SMART Tbk (“SMART”) and PT Ivo Mas Tunggal. SMART listed its shares on the Indonesia Stock Exchange in 1992.

GAR is focused on sustainable palm oil production. Its primary activities include cultivating and harvesting of oil palm trees; processing of fresh fruit bunch into crude palm oil ("CPO") and palm kernel; and refining CPO into value-added products such as cooking oil, margarine and shortening. Through its subsidiaries, GAR operates 35 palm oil processing mills, three refineries and six kernel crushing plants. It also has an integrated operation in China including a deep sea port, two soybean crushing plants, and production of refined edible oil products.



Please look at the short term daily chart of Golden Agri above for a study of its price action.

The price hit a high of $0.70 on 18 Oct and has since retraced to sit between support of $0.655 (previous high) and $0.645 (61.8% fibonacci retracement).

If this support zone holds, and the price resumes its uptrend, then my near term target price for Golden Agri will be between $0.75 ($0.70 (recent high) + ($0.70-0.65)) and $0.785 (161.8% fibonacci projection).

But if the price of Golden Agri breaks significantly below the 61.8% fibonacci retracement of ($0.645), then it is a pattern failure and the above analysis becomes invalid.

How high can Genting Singapore go?

Genting Singapore PLC* ("Genting Singapore") is a leading integrated resorts development specialist with over 20 years of international gaming expertise and global experience in developing, operating and/or marketing internationally acclaimed casinos and integrated resorts in different parts of the world, including Australia, the Americas, Malaysia, the Philippines and the United Kingdom (“UK”).

Genting's rise in share price is incredible. Look at its weekly chart above. It's share price rose from a low of about $0.30 in Oct 08 to about $2.16 today (a 620% increase over 2 years!, if my maths is correct).



So where do i think the share price will go? First of all, i am bullish about this counter. It has been on a strong uptrend since Oct 08, with its price riding comfortably above both the 50 and 200 period moving averages. It hit a high of $2.18 on 20 Sep 2010 and retraced to a swing low of $1.85 on 30 Sep 2010. It is now testing the previous high of $2.18. If it should break above $2.18, the new price target is $2.18 + ($2.18 - $1.85) = $2.51. Approximate time to hit this target = time taken for it to go from its swing low (30 Sep 2010) to the day it breaks above $2.18. I approximate it to be one month.

Happy trading!

Bigger picture of COSCO Corp

above is a longer term look at Cosco.

The longer term trend of COSCO is now firmly up: the price of COSCO has now risen above both the short term 50day moving average and longer term 200d moving average.

As you can see, we have a long way to go before hitting even 50% of its all time high of $8.20.

COSCO about to breakout?

COSCO Corp (S)
Business: Ship repair, ship building & marine engineering

Technicals: It is a bit difficult to show COSCO's chart in the proper perspective. Its high was $8.20 in OCT 07 and it came crashing to $0.60 in OCT 08. It has since been climbing slowly, but in a volatile fashion, to $1.92. I attach a short term chart to show that there is resistance at $1.93 and it is now trying to breakout of that price today.

If COSCO manages to breakout of $1.93, my next upside target will be $2.18 (the 161.8% fibonnaci level from the previous swing low of $1.53.

Commodities Price Surge May Be Fueled by Japan - CNBC

Commodities Price Surge May Be Fueled by Japan - CNBC

Golden Agri

Business: involved in cultivating, processing and sale of crude palm oil (CPO) and related products.

Technicals:



A quick look at Golden agri's chart. The price peaked at $1.08 in Feb 2008. When the financial crisis hit, the price dropped to a low of $0.13 in Oct 2008. After that, it has been steadily on an uptrend, peaking at $0.655 in Jan 2010, and then consolidating sideways when fears of a double dip rose. The price tested $0.62 on three previous occasions, but each time, it failed to breakout of that price. It is testing $0.62 again today.

If it breaks out of $0.62, my upside target would be $0.62 + ($0.62 - $0.50) = $0.74. ($0.50 being the previous swing low).