Technically, short to long term trend is a down. The short-term bottoming which might form last week didn't materalize either. In the ADX chart, the DI+ and DI- were negatively spread further and with ADX still maintain at 40 level, the downward trend is maintaining with strength. MACD fell further into deep negative region and no sign of near term convergence. RSI is floating around the 30% level unable to cut up. Stochastic lied below the 20% level in the oversold region and no sign of cutting up either. If there is any oversold rebound perhaps will take another 1 or 2 more sessions to occur. STI is now at the 1,600 psychological level and even though on 24th Oct 08, intra-day low hit below 1,600 but the support at 1,600 doesn't appear to be strong either. Base on Eillott Wave theory on the downward Wave A -> B -> C, STI is now in the Wave C ( the last leg down ) and by taking starting point of Wave A at 3,899.29, end of Wave A/start of Wave B at 2,745.96, end of Wave B/start of Wave C at 3,269.88, the ending point of Wave C could extend to 1.618x of Wave A which lead to a value of 1,403.79; around the 1,400 level. Hence, there is a possibility that STI could be hitting the 1,400 level by the coming week.
As the earning season already kicked in, below is the date for the list of companies announcing their result.
1. CitySpring -- 11/11/08
2. Indoargi -- 30/10/08
3. Cambridge -- 30/10/08
4. SingPost -- 30/10/08
5. Suntec Reit -- 30/10/08
6. CDL H Trust -- 29/10/08
7. UOB -- 31/10/08
8. CSM -- 31/10/08
9. MIIF -- 12/11/08
10. CapitaRChina -- 29/10/08
11. ST Engg -- 4/11/08
12. Capitaland -- 31/10/08
13. AscendasIndia reits -- 30/10/08
14. SMRT -- 31/10/08
15. Plife -- 4/11/08
16. ST Engg -- 4/11/08
17. OCBC -- 5/11/08
18. UOL -- 5/11/08
19. Noble -- 10/11/08
20. SIA Engg -- 3/11/08
21. DBS -- 7/11/08
22. SembMar -- 4/11/08
23. Cosco -- 30/10/08
24. SIA -- 6/11/08
25. SembCorp -- 7/11/08
26. Goldenargi -- 12/11/08
27. CityDev -- 13/11/08
For the coming week, the main focus will be on the US FOMC meeting on 28/29th Oct 08 whereby majority are expecting the US Federal Reserve to further cut their interest rate from the current 1.5% to 1.0% as global economy is falling while inflation issue is not that big a problem for the US Fed to continue to lower the rate. For Singapore, UOB earning on 31st Oct 08 and DBS resolving issue regarding the Lehman Brothers' minibonds and its High Notes 5 will be the main focus point for the bank stocks for the coming week. If there is an oversold rally, the US FOMC decision on the interest rate might provide that if US Fed decided to cut the interest rate by another 0.5%. STI market will still be volatile for the coming week with strengthening of yen, crude oil price possible dropping to US$50/barrel, weaker than expected corporate's earning and fear of recession deciding the direction of STI.
For short-term traders, advice is to remain cautious as market is till too volatile and any rebound is a chance to take profit or cut-loss.
For long-term investors with 10 years investment time frame, should be looking from fundamental point of view of a counter and decide on various entry prices to slowly collect, spread out the purchase and that could minimize the downside risk quite an amount.
