Since hitting around the $12 level on 3 occasions ( 30th Oct, 5th Nov, 10th Nov ), DBS has pulled back to as low as $8.94 ( intra-day low ) on 21st Nov 08 and building a support around the $9.00 level since then. Looking at the Stochastic indicator, it is flattish in the oversold region since 25th Nov 08 and trading in a daily range of between $9.00 to $9.30. In the ADX chart, the DI pair still negatively spaced but maintained a fairly constant distance between them, no divergence suggesting downside limited and also no sign of convergence signaling short-term price will be range bound. MACD signals are slowly moving towards the zero line. All these could be signaling a base is being built at the moment for the year end rally with a potential target price at $12.00 level. Investors/traders could strategically position themselves by going long around the $9.o0 level and if possible get another long position if sudden capitulation occurs which sends the price below the $9.00 level to a possible around the $8.80 level. With a possible year end rally, the downside risk is relatively small as compared to the rewards.
