| | | | | Commentary | | The Straits Times index fell 0.19% or 6.26pts to 3251.26 (day range: 3264.05 - 3242.53) on Wednesday. The index is above its 20d MA (@ 3231) and above its 50d MA (@ 3207). 60% of the index constituents are above their 20D MA (vs 63% the previous session) and 53% of the shares are above their 50D MA (vs 63%). Technically, the index continues to trade at levels near to the upper Bollinger band. It is still well supported by the 20-day moving average. In fact, for over six months the 20-day moving average has been riding above the 50-day one, keeping the bullish short-term outlook intact. In case the index succeeds in reaching the first upside target at 3290, it should then target 3337. The level of 3185 remains to be the key support. The HSI index was flat on Wednesday. The index is above its 20d MA (@ 25678) and above its 50d MA (@ 24963). 56% of the index constituents are above their 20D MA (vs 63% the previous session) and 81% of the shares are above their 50D MA (vs 84%). Technically, the index has entered a consolidation phase has it has deviated further from the upper Bollinger band. However, it remains well supported by the 20-day moving average, which stays above the 50-day one. Meanwhile, the relative strength index is still above the neutrality level of 50. The short-term bias is still bullish, and as long as the level of 25000 holds as the key support, the index could proceed to challenge the first upside target at 26350. |
| Straits Times Intraday: choppy. |  | Pivot: 3265.00
Our preference: short positions below 3265.00 with targets at 3243.00 & 3234.00 in extension.
Alternative scenario: above 3265.00 look for further upside with 3275.00 & 3288.00 as targets.
Comment: as long as the resistance at 3265.00 is not surpassed, the risk of the break below 3243.00 remains high.
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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 | | Put | 3050.00 | 31/08/2017 | -0.4 | CFWW | Macquarie Bank | STI MBL EPW170831% | High risk | 2500.0 % | 18.6 % | | Put | 3050.00 | 31/08/2017 | -0.4 | CFWW | Macquarie Bank | STI MBL EPW170831% | High risk | 2500.0 % | 18.6 % | | Call | 3300.00 | 31/08/2017 | 0.3 | CFVW | Macquarie Bank | STI MBL ECW170831% | High risk | 2500.0 % | 8.1 % | | Call | 3300.00 | 31/08/2017 | 0.3 | CFVW | Macquarie Bank | STI MBL ECW170831% | High risk | 2500.0 % | 8.1 % |
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| Hang Seng Intraday: key resistance at 25915. | | Pivot: 25915
Our preference: short positions below 25915 with targets at 25685 & 25620 in extension.
Alternative scenario: above 25915 look for further upside with 26100 & 26250 as targets.
Comment: the RSI is capped by a declining 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 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 % | 23.6 % | | Put | 24688.00 | 28/07/2017 | -0.3 | CHIW | Bank Vontobel | HSI VT EPW170728% | High risk | 1000.0 % | 23.6 % | | Put | 24688.00 | 28/07/2017 | -0.3 | CHIW | Bank Vontobel | HSI VT EPW170728% | High risk | 1000.0 % | 23.6 % | | Call | 25800.00 | 28/07/2017 | 0.5 | CGYW | Macquarie Bank | HSI MBL ECW170728% | Medium risk | 1000.0 % | 21.3 % | | Call | 26400.00 | 30/08/2017 | 0.4 | CHLW | Macquarie Bank | HSI MBL ECW170830% | High risk | 1000.0 % | 18.8 % | | Call | 25000.00 | 28/07/2017 | 0.6 | CGRW | Macquarie Bank | HSI MBL ECW170728% | Medium risk | 1000.0 % | 13.0 % |
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| DBS Group Intraday: turning down. | | Pivot: 20.83
Our preference: short positions below 20.83 with targets at 20.38 & 20.30 in extension.
Alternative scenario: above 20.83 look for further upside with 21.00 & 21.15 as targets.
Comment: technically the RSI is above its neutrality area at 50.
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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 | 19.50 | 16/10/2017 | -0.4 | CGXW | Macquarie Bank | DBS GROUP MBL EPW171016% | Medium risk | 9.0 % | 10.4 % | | Put | 19.50 | 16/10/2017 | -0.4 | CGXW | Macquarie Bank | DBS GROUP MBL EPW171016% | Medium risk | 9.0 % | 10.4 % | | Call | 22.00 | 16/10/2017 | 0.3 | CGQW | Macquarie Bank | DBS GROUP MBL ECW171016% | Medium risk | 9.0 % | 9.7 % | | Call | 20.00 | 01/11/2017 | 0.6 | CBMW | Macquarie Bank | DBS GROUP MBL ECW171101% | Low risk | 8.0 % | 7.7 % |
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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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