| | | | | Commentary | | The Straits Times index rose 0.73% or 23.43pts to 3234.54 (day range: 3238.94 - 3221.75) on Wednesday. The index is above its 20d MA (@ 3169) and above its 50d MA (@ 3151). 63% of the index constituents are above their 20D MA (vs 60% the previous session) and 63% of the shares are above their 50D MA (vs 63%). On a daily basis, the index is surging on the upside, and is looking for a higher top. Both 20-day and 50-day moving averages are positive and should maintain the bullish bias, and the relative strength index has broken above a negative trend line with strong upward momentum. As long as 3155 holds as the key support, further upside is expected. Hong Kong's market was closed on Wednesday for Buddha's Birthday. The HSI index rose 0.33% or 81pts to 24696.13 (day range: 24773.8 - 24577.33) on Tuesday. The index is above its 20d MA (@ 24279) and above its 50d MA (@ 24121). 60% of the index constituents are above their 20D MA (vs 63% the previous session) and 65% of the shares are above their 50D MA (vs 67%). Trading volume on the index was low, 35.4% below the 3 months average. On the daily chart, the index is currently challenging its upper Bollinger band, and is expected to look for a higher top. The 20-day moving average remains above the 50-day one, and the daily relative strength index is above its neutrality area at 50, showing further upside momentum. As long as the level of 24150 holds as the key support, further rise is preferred. |
| Straits Times Intraday: the upside prevails. |  | Pivot: 3210.00
Our preference: long positions above 3210.00 with targets at 3250.00 & 3265.00 in extension.
Alternative scenario: below 3210.00 look for further downside with 3180.00 & 3160.00 as targets.
Comment: the RSI lacks downward momentum.
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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 | 3300.00 | 31/08/2017 | 0.3 | CFVW | Macquarie Bank | STI MBL ECW170831% | Medium risk | 2500.0 % | 6.7 % | | Call | 3300.00 | 31/08/2017 | 0.3 | CFVW | Macquarie Bank | STI MBL ECW170831% | Medium risk | 2500.0 % | 6.7 % | | Put | 3050.00 | 31/08/2017 | -0.4 | CFWW | Macquarie Bank | STI MBL EPW170831% | Medium risk | 2500.0 % | 11.3 % | | Put | 2900.00 | 30/06/2017 | -0.3 | CDMW | Macquarie Bank | STI MBL EPW170630% | High risk | 2500.0 % | 21.6 % |
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| Hang Seng Intraday: bullish bias above 24480. | | Pivot: 24480
Our preference: long positions above 24480 with targets at 24780 & 24900 in extension.
Alternative scenario: below 24480 look for further downside with 24350 & 24200 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 Hang Seng |
| Type | Strike | Expiry | Delta | Ticker | Issuer | Name | Risk | Conv ratio | Eff. Gearing | | Call | 23800.00 | 29/05/2017 | 0.7 | CFGW | Macquarie Bank | HSI MBL ECW170529% | Low risk | 1000.0 % | 15.6 % | | Call | 23800.00 | 29/05/2017 | 0.7 | CFGW | Macquarie Bank | HSI MBL ECW170529% | Low risk | 1000.0 % | 15.6 % | | Call | 24600.00 | 29/05/2017 | 0.5 | CFFW | Macquarie Bank | HSI MBL ECW170529% | Medium risk | 1000.0 % | 23.6 % | | Put | 24000.00 | 29/05/2017 | -0.3 | CFTW | Macquarie Bank | HSI MBL EPW170529% | High risk | 1000.0 % | 22.2 % | | Put | 24000.00 | 29/05/2017 | -0.3 | CFTW | Macquarie Bank | HSI MBL EPW170529% | High risk | 1000.0 % | 22.2 % | | Put | 23800.00 | 29/06/2017 | -0.4 | CGKW | Macquarie Bank | HSI MBL EPW170629% | High risk | 1000.0 % | 17.7 % |
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| Wilmar International Intraday: further advance. | | Pivot: 3.52
Our preference: long positions above 3.52 with targets at 3.59 & 3.62 in extension.
Alternative scenario: below 3.52 look for further downside with 3.49 & 3.47 as targets.
Comment: the RSI is supported by a bullish trend line.
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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 Wilmar International |
| Type | Strike | Expiry | Delta | Ticker | Issuer | Name | Risk | Conv ratio | Eff. Gearing | | Call | 3.40 | 03/07/2017 | 0.6 | BYTW | Macquarie Bank | WILMAR INTERNATIONAL MBL ECW170703% | Medium risk | 5.5 % | 8.6 % | | Call | 3.40 | 03/07/2017 | 0.6 | BYTW | Macquarie Bank | WILMAR INTERNATIONAL MBL ECW170703% | Medium risk | 5.5 % | 8.6 % | | Put | 3.40 | 10/07/2017 | -0.5 | CCDW | Macquarie Bank | WILMAR INTERNATIONAL MBL EPW170710% | Medium risk | 5.5 % | 12.9 % | | Put | 3.40 | 10/07/2017 | -0.5 | CCDW | Macquarie Bank | WILMAR INTERNATIONAL MBL EPW170710% | Medium risk | 5.5 % | 12.9 % |
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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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