I guess everyone have seen the impact of the fed's rate 50bp cut on the stock market. Super rebound, and it seems that dow is going to touch that 14000 mark again. I recall a few months when dow touched that 14000 mark, wao, the market really went crazy and everyone was so bullish! But after that, you can see the chart for yourself.
As far as it seems, oil is the highest potential to cause damage to the stock market, as it has risen non stop! Now trading around US$80 per barrel, if US$ dollar keeps depreciating, we can see oil hit another all time high! Making the situation more confusing, now GE workers are on strike!
Next is the yen dollar. Now it is at 114.58-114.63, which is slightly lower than expected, but if the US$ dollar drop, definitely the yen will appreciate in its currency. 1 thing I learned about inflation is, you won't feel the impact so soon. People need to adapt to the situation slowly and by the time you know it, the news will be everywhere broadcasting about inflation, recession etc. The time lag is something to take note and get out before it hits your stocks!
Since 18th Sept, the market has been rallying for a week already, and it seems that people are still quite confused with whether there is an uptrend or not, as volume in STI is not that convincing compared to the may-june period.
Previously I was talking about the sensitive days like Sept 11th or our Singapore national day. Especially on these days, the market will never let itself crash or drop. Why? If US markets were to drop, people will be reminded of those fateful events and will think that some disasters are going to strike again! On Singapore's national day, you won't want the market to fall either because it's a day of celebration of the country and the 'invisible' force will not let the market drop on that day. BUT after the day itself, it usually drops for some unknown reasons.
While work and studies were quite hectic these few weeks, I didn't have much time looking at the charts, but just keeping up with the latest news around. With DBS CEO stepping down, he provided with such a nice excuse to leave DBS. While I said to take note of CWT and OKP, I didn't realised that CWT has ran so much and it is now at $1.28! That was like only 1-2 weeks ago when it was still in the $0.80 region!
I was talking to my colleague 1 day and he told me about the low volume trades in STI. He was referring to the low volume traders as small - medium time retailers and say it was a good chance to enter before the big buyers are in. In my view, those low volumes are the big buyers instead. Why? Think of it this way, if it was a small or medium time retailer, is he/she truely capable of pushing the price from e.g., $0.40 to $0.43, 0.44 or 0.45? Considering the amount of capital he/she must have, the amount of stocks he/she must purchase to push up 1 cent each time, small and medium time retailers may not have the capital to do so! I don't really think that from $0.40 to $0.43 for example can be pushed by many retailers, because of the fact that not everyone thinks the same for the counter! Thus my conclusion to that is that only the big buyer is able to push the price up with capital, at the same time, luring the small time retailers to think that this counter is going to run, better catch the train before it is too late and when you try to enter at $0.41, you will miss because the buying is so fast! Probably it may reach $0.44 before you are able to buy in, but the big buyer has already positioned nicely and able to get out from $0.44! But this is my deduction only, it may not be true but whenever I see the counter running that fast, I won't consider but you can consider shorting it, because when it gaps up too much, there must be a gap down to cover the differences be it how fundamentally strong the stock may be.
In any case, I have re-entered my position into celestial at $1.21. High potential for this counter, as its share value should be around $1.40 instead of its current price. It has received some awards for its beans and the annual report for this year is not bad as well. Stochastics are low for this since it has been running for the past 1-2 weeks, trendline marks a continuous pattern which I will post later when I'm free.
No comments:
Post a Comment