| | | | | Commentary | | The Straits Times index was flat on Friday. The index is above its 20d MA (@ 3159) and above its 50d MA (@ 3122). 60% of the index constituents are above their 20D MA (vs 57% the previous session) and 80% of the shares are above their 50D MA (vs 77%). On a daily chart, the index is taking a breather after a strong rebound from the key support at 3105. It is seeking support from the ascending 20-day moving average. Meanwhile, the bullish short-term bias is still maintained by the well-directed 20- and 50-day moving averages. And the relative strength index remains above the neutrality level of 50. As long as the index keeps trading above 3105, it still stands a chance of resuming the uptrend targeting the first upside target at 3240. The HSI index was flat on Friday. The index is above its 20d MA (@ 24213) and above its 50d MA (@ 23883). 53% of the index constituents are above their 20D MA (vs 60% the previous session) and 65% of the shares are above their 50D MA (vs 70%). On the daily chart, the index posted a deeper consolidation while remaining above the key support at 23800. Meanwhile, intraday technical indicators (20-, 50-day moving averages, relative strength index) have not indicated a change to the bullish short-term outlook. Therefore, caution is advised. If the consolidation phase ends with the index standing above 23800, the index still stands a chance of revisiting the resistance at 24700. However, a break below 23800 would call for a further decline toward 23200. |
| Straits Times Intraday: rebound. |  | Pivot: 3163.00
Our preference: long positions above 3163.00 with targets at 3190.00 & 3200.00 in extension.
Alternative scenario: below 3163.00 look for further downside with 3156.00 & 3146.00 as targets.
Comment: the RSI is mixed to bullish.
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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 | | Associated Warrants for Straits Times |
| Type | Strike | Expiry | Delta | Ticker | Issuer | Name | Risk | Conv ratio | Eff. Gearing | | Call | 3050.00 | 30/06/2017 | 0.5 | CDKW | Macquarie Bank | STI MBL ECW170630% | Medium risk | 2500.0 % | 8.5 % | | Call | 3000.00 | 28/04/2017 | 0.7 | CBVW | Macquarie Bank | STI MBL ECW170428% | Low risk | 2500.0 % | 11.6 % | | Put | 2950.00 | 28/04/2017 | -0.3 | CBXW | Macquarie Bank | STI MBL EPW170428% | High risk | 2500.0 % | 38.2 % | | Put | 2900.00 | 30/06/2017 | -0.3 | CDMW | Macquarie Bank | STI MBL EPW170630% | High risk | 2500.0 % | 14.7 % |
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| Hang Seng Intraday: under pressure. | | Pivot: 24320
Our preference: short positions below 24320 with targets at 24160 & 24090 in extension.
Alternative scenario: above 24320 look for further upside with 24440 & 24470 as targets.
Comment: the RSI is bearish and calls for further downside.
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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 | | Associated Warrants for Hang Seng |
| Type | Strike | Expiry | Delta | Ticker | Issuer | Name | Risk | Conv ratio | Eff. Gearing | | Call | 24200.00 | 27/04/2017 | 0.5 | CCUW | Macquarie Bank | HSI MBL ECW170427% | Medium risk | 1000.0 % | 25.8 % | | Call | 23800.00 | 29/05/2017 | 0.6 | CFGW | Macquarie Bank | HSI MBL ECW170529% | Medium risk | 1000.0 % | 14.4 % | | Call | 24600.00 | 29/05/2017 | 0.4 | CFFW | Macquarie Bank | HSI MBL ECW170529% | High risk | 1000.0 % | 19.7 % | | Put | 23600.00 | 27/04/2017 | -0.3 | CESW | Macquarie Bank | HSI MBL EPW170427% | High risk | 1000.0 % | 42.5 % | | Put | 23200.00 | 29/06/2017 | -0.3 | CEVW | UBS | HSI UBS EPW170629% | High risk | 1000.0 % | 14.3 % | | Put | 23200.00 | 29/06/2017 | -0.3 | CEVW | UBS | HSI UBS EPW170629% | High risk | 1000.0 % | 14.3 % |
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| DBS Group Intraday: key resistance at 19.21. | | Pivot: 19.21
Our preference: short positions below 19.21 with targets at 19.00 & 18.90 in extension.
Alternative scenario: above 19.21 look for further upside with 19.32 & 19.42 as targets.
Comment: even though a continuation of the technical rebound cannot be ruled out, its extent should be limited.
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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 | | Associated Warrants for DBS Group |
| Type | Strike | Expiry | Delta | Ticker | Issuer | Name | Risk | Conv ratio | Eff. Gearing | | Put | 18.00 | 02/10/2017 | -0.5 | CBNW | Macquarie Bank | DBS GROUP MBL EPW171002% | Low risk | 8.0 % | 6.7 % | | Put | 16.80 | 30/10/2017 | -0.4 | CBOW | Macquarie Bank | DBS GROUP MBL EPW171030% | Medium risk | 8.0 % | 9.9 % | | Call | 19.50 | 10/07/2017 | 0.3 | CBJW | Macquarie Bank | DBS GROUP MBL ECW170710% | Medium risk | 8.0 % | 9.1 % | | Call | 18.00 | 03/07/2017 | 0.6 | CBDW | Macquarie Bank | DBS GROUP MBL ECW170703% | Medium risk | 8.0 % | 8.7 % |
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 | 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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