| | | | | Commentary | | The Straits Times index rose 0.36% or 11.79pts to 3260.13 (day range: 3264.92 - 3252.62) on Tuesday. The index is above its 20d MA (@ 3230) and above its 50d MA (@ 3206). 63% of the index constituents are above their 20D MA (vs 57% the previous session) and 63% of the shares are above their 50D MA (vs 53%). Technically, the index keeps trading around the upper Bollinger band, suggesting further upward acceleration. Extra support is provided by the 20-day and 50-day moving averages. Also, the ascending relative strength index is calling for a further upleg for the index. As long as the bullish bias is maintained with the key support at 3185 remaining untouched, the index should advance toward the first upside target at 3290, and then the second one at 3337. The HSI index rose 0.56% or 144.06pts to 25852.1 (day range: 25883.22 - 25722.63) on Tuesday. The index is above its 20d MA (@ 25651) and above its 50d MA (@ 24933). 63% of the index constituents are above their 20D MA (vs 53% the previous session) and 84% of the shares are above their 50D MA (vs 86%). Technically, the index has entered a consolidation phase but remains positioned above the 20-day moving average. Meanwhile, the short-term outlook continues to be maintained by the well-directed 20-day and 50-day moving averages. Though the relative strength index has retreated from its highs, it remains above the neutrality level of 50. Therefore, as long as the key support at 25000 is not violated, the index still stands chances of challenging the first upside target at 26350. |
| Straits Times Intraday: the bias remains bullish. |  | Pivot: 3245.00
Our preference: long positions above 3245.00 with targets at 3275.00 & 3288.00 in extension.
Alternative scenario: below 3245.00 look for further downside with 3234.00 & 3226.00 as targets.
Comment: a support base at 3245.00 has formed and has allowed for a temporary stabilisation.
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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% | High risk | 2500.0 % | 7.7 % | | Call | 3300.00 | 31/08/2017 | 0.3 | CFVW | Macquarie Bank | STI MBL ECW170831% | High risk | 2500.0 % | 7.7 % | | Put | 3050.00 | 31/08/2017 | -0.4 | CFWW | Macquarie Bank | STI MBL EPW170831% | High risk | 2500.0 % | 19.3 % | | Put | 3050.00 | 31/08/2017 | -0.4 | CFWW | Macquarie Bank | STI MBL EPW170831% | High risk | 2500.0 % | 19.3 % |
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| Hang Seng Intraday: under pressure. | | Pivot: 25900
Our preference: short positions below 25900 with targets at 25620 & 25490 in extension.
Alternative scenario: above 25900 look for further upside with 26100 & 26250 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 Hang Seng |
| Type | Strike | Expiry | Delta | Ticker | Issuer | Name | Risk | Conv ratio | Eff. Gearing | | Put | 24688.00 | 28/07/2017 | -0.3 | CHIW | Bank Vontobel | HSI VT EPW170728% | High risk | 1000.0 % | 22.5 % | | Put | 24688.00 | 28/07/2017 | -0.3 | CHIW | Bank Vontobel | HSI VT EPW170728% | High risk | 1000.0 % | 22.5 % | | Put | 24688.00 | 28/07/2017 | -0.3 | CHIW | Bank Vontobel | HSI VT EPW170728% | High risk | 1000.0 % | 22.5 % | | Call | 25800.00 | 28/07/2017 | 0.5 | CGYW | Macquarie Bank | HSI MBL ECW170728% | Medium risk | 1000.0 % | 21.0 % | | Call | 26400.00 | 30/08/2017 | 0.4 | CHLW | Macquarie Bank | HSI MBL ECW170830% | High risk | 1000.0 % | 19.1 % | | Call | 25000.00 | 28/07/2017 | 0.6 | CGRW | Macquarie Bank | HSI MBL ECW170728% | Medium risk | 1000.0 % | 13.1 % |
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| DBS Group Intraday: further advance. | | Pivot: 20.55
Our preference: long positions above 20.55 with targets at 20.89 & 21.02 in extension.
Alternative scenario: below 20.55 look for further downside with 20.38 & 20.30 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 DBS Group |
| Type | Strike | Expiry | Delta | Ticker | Issuer | Name | Risk | Conv ratio | Eff. Gearing | | Call | 22.00 | 16/10/2017 | 0.4 | CGQW | Macquarie Bank | DBS GROUP MBL ECW171016% | Medium risk | 9.0 % | 11.8 % | | Call | 20.00 | 01/11/2017 | 0.6 | CBMW | Macquarie Bank | DBS GROUP MBL ECW171101% | Low risk | 8.0 % | 7.8 % | | Put | 19.50 | 16/10/2017 | -0.3 | CGXW | Macquarie Bank | DBS GROUP MBL EPW171016% | Medium risk | 9.0 % | 8.6 % | | Put | 19.50 | 16/10/2017 | -0.3 | CGXW | Macquarie Bank | DBS GROUP MBL EPW171016% | Medium risk | 9.0 % | 8.6 % |
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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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