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Straits Times 3,114.16 -11.98 -0.38%
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HKland: Will It Go Down Further?
Trend Spotting | 10 October 2012
By: Robin Han
Articles (102) Profile

The STI broke the resistance at 3,090 last Friday. However, it broke down from 3,090 and formed a bearish engulfing pattern on Monday. It also formed a false breakout, signaling a strong bearish signal. In retrospect, the recent false break out of STI happened on 3 May 2012 and 1 August 2011 resulted in a sell down of STI.

Last night, the US market was weak with S&P 500 breaking down the supporting trendline. If it is not able to rebound 1,450 or even higher, it is likely to start a mid-term downtrend.

I may look for weak stocks to short in the next few days or weeks due to the bearish signal of both Singapore and US markets.

HKland was weak as compared to STI. The stock did not manage to follow in the past few months when STI was going up. From the weekly chart, we can see that it was testing the supporting trendline and the breakdown may result in a downtrend.

From the daily chart, we can see that it started going down before STI – a confirmation of weakness. If it breaks the consolidation zone and also the supporting trendline, it may start a mid-term downtrend.

STI

S&P500

HKland weekly

HKland daily

Robin Han is a Ph.D in Department of Chemical and Biomolecular Engineering and has got a solid foundation in the financial markets.

Please click here for more information about this author.


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