| | | | | Commentary | | Singapore | | The Straits Times index dropped 0.1% or 3.1pts to 3223.24 (day range: 3229.51 - 3210.1) on Friday. The index is below its 20d MA (@ 3232) and below its 50d MA (@ 3228). 33% of the index constituents are above their 20D MA (vs 40% the previous session) and 40% of the shares are above their 50D MA (vs 43%). On a daily basis, the index still in a consolidation mode around its 20-day and 50-day moving averages, and stays above the horizontal support at 3185. The relative strength index is around 50, showing a lack of momentum. 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. Alternatively, a break below 3185 will call for further consolidation as likely.
The HSI index fell 0.49% or 124.37pts to 25340.85 (day range: 25409.9 - 25315.91) on Friday. The index is below its 20d MA (@ 25703) and be low its 50d MA (@ 25468). 28% of the index constituents are above their 20D MA (vs 35% the previous session) and 37% of the shares are above their 50D MA (vs 37%). On the daily chart, the index has broken below its 20-day moving average, and is consolidating around the 50-day moving average. The relative strength index is also crossing below the neutrality at 50. As long as 26100 holds as the resistance, the index is likely to post further consolidation. Below 26100, a new down leg to 24800 is expected.
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| Straits Times ST: bullish bias above 3185.00. | | Pivot: 3185.00
Our preference: long positions above 3185.00 with targets at 3290.00 & 3337.00 in extension.
Alternative scenario: below 3185.00 look for further downside with 3115.00 & 3070.00 as targets.
Comment: a support base at 3185.00 has formed and has allowed for a temporary stabilisation.
| | In order to leverage this directional view we have selected the following warrant: | | Strike | 3200.00 | | Expiry | 31/10/2017 | | Delta | 0.5 | | Ticker | CIJW | | Issuer | Macquarie Bank | | Name | STI MBL ECW171031 | | Conv ratio | 2500.0 | | Eff. Gearing | 9.5 | | Warrant Strategy | |
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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 |
| Hang Seng ST: under pressure. | | Pivot: 26100
Our preference: short positions below 26100 with targets at 24800 & 24350 in extension.
Alternative scenario: above 26100 look for further upside with 27000 & 27450 as targets.
Comment: as long as 26100 is resistance, likely decline to 24800.
| | In order to leverage this directional view we have selected the following warrant: | | Strike | 25200.00 | | Expiry | 28/07/2017 | | Delta | -0.4 | | Ticker | CHPW | | Issuer | Macquarie Bank | | Name | HSI MBL EPW170728 | | Conv ratio | 1000.0 | | Eff. Gearing | 28.0 | | Warrant Strategy | |
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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 |
| 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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Copyright 2017 - TRADING CENTRAL | | Warrants involve risk and are not suitable for everyone. Prior to buying or selling a warrant, investors should receive appropriate training or documentation on warrants characteristics from their broker, from the Singapore Exchange or from one of the issuers. TRADING Central is not a broker-dealer. TRADING Central is not affiliated with the Singapore Exchange, the issuers of warrants mentioned in this site or their affiliates. Investors should exercise judgment and perform adequate due-diligence prior to making any investment. | | |
Selections are made from structured warrants issued by Supporting Parties.
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The information contained in this Newsletter is obtained from sources believed to be reliable and accurate as at the date of publication. However, TRADING CENTRAL has not verified the materials, which may not be complete or accurate. Opinions, estimates and other information contained herein may be changed or withdrawn without notice. Any prices and quotes published in this Newsletter are purely indicative and for information purposes only. Indicative prices and quotes shown in this Newsletter may vary significantly from indicative prices or quotes available from other sources.
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Investment products are subject to significant investment risks, including the possible loss of the principal amount invested. Past performance of investment products is not indicative of their future performance.
The warrant issuers and their affiliates may from time to time take proprietary positions, and may have long or short positions or other interests, in the investment products. The warrant issuers and their affiliates are or may also be involved in other financial, investment and professional activities which may on occasion give rise to interests or a conflict of interests in respect of the investment products. The warrant issuers or their affiliates may make a market or appoint designated market makers to make a market for the warrants. The warrant issuers and/or the designated market makers make no representation nor can it give any assurance as to the liquidity in the trading of warrants as the warrant issuer or the designated market maker may be the only person quoting prices in the warrants.
This Newsletter is for general circulation only and is not an offer or solicitation to buy or sell, nor financial advice or recommendation for any investment product. It does not address the specific investment objectives, financial situation or particular needs of any person. Advice should be sought from a financial adviser regarding the suitability of any investment product before investing or adopting any investment strategies. None of the parties funding the publication costs of or supporting this Newsletter (the Supporting Parties) shall be liable to any Subscriber in any way for any liability whatsoever and howsoever arising. Each of the Supporting Party shall have the right under the Contracts (Rights of Third Parties) Act 1999 to enforce its rights under this Agreement.
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