| | | | | Commentary | | Singapore |  | The Straits Times index declined 2% or 69.98pts to 3421.39 (day range: 3436.08 - 3394.55) on Friday. The index is below its 20d MA (@ 3503) and below its 50d MA (@ 3503). 13% of the index constituents are above their 20D MA (vs 43% the previous session) and 17% of the shares are above their 50D MA (vs 37%). Trading volume on the index was high, 39.2% above the 3 months average. Technically, the index has crossed below the key support at 3425 after a 2% sell-off, turning the short-term outlook bearish. Currently it has down-shot the lower Bollinger band, calling for acceleration to the downside. And the relative strength index has become badly directed in the 30s, indicating continued downward momentum for the index. Short-term bearishness is expected to bring the index down to 3340 (around the low of February) and in extension, 3270. Key resistance (stop-loss level) is located at 3558.
The HSI index dropped 2.45% or 761.7 6pts to 30309.29 (day range: 30320.31 - 29930.23) on Friday. The index is below its 20d MA (@ 31051) and below its 50d MA (@ 31391). 30% of the index constituents are above their 20D MA (vs 48% the previous session) and 20% of the shares are above their 50D MA (vs 42%). Trading volume on the index was high, 34.3% above the 3 months average. Technically, the index has produced a bearish gap losing over 2% at close. Currently it has returned to levels below both the 20-day and 50-day moving averages while testing the first downside target at 29850. The relative strength index is badly directed below the neutrality level of 50, signaling continued downward momentum for the index. With short-term bearishness remaining in force, the index should sink toward 29130 (around the low of February) once crossing below 29850. The level of 31800, which has been challenged repeatedly, continues to be the key resistance. |
| Straits Times ST: turning down. | | Pivot: 3558.00
Our preference: short positions below 3558.00 with targets at 3340.00 & 3270.00 in extension.
Alternative scenario: above 3558.00 look for further upside with 3615.00 & 3670.00 as targets.
Comment: the RSI shows downside momentum.
| | In order to leverage this directional view we have selected the following warrant: | | Strike | 3450.00 | | Expiry | 29/06/2018 | | Delta | -0.5 | | Ticker | CRCW | | Issuer | Macquarie Bank | | Name | STI MBL EPW180629 | | Conv ratio | 2500.0 | | Eff. Gearing | 8.1 | | Warrant Strategy |  |
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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 |
| Hang Seng ST: watch 29850. | | Pivot: 31800
Our preference: short positions below 31800 with targets at 29850 & 29130 in extension.
Alternative scenario: above 31800 look for further upside with 33500 & 34600 as targets.
Comment: a break below 29850 would trigger a drop towards 29130.
| | In order to leverage this directional view we have selected the following warrant: | | Strike | 29800.00 | | Expiry | 27/04/2018 | | Delta | -0.4 | | Ticker | CRAW | | Issuer | Macquarie Bank | | Name | HSI MBL EPW180427 | | Conv ratio | 1000.0 | | Eff. Gearing | 12.7 | | Warrant Strategy | |
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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 |
 | 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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Copyright 2018 - TRADING CENTRAL | | Warrants involve risk and are not suitable for everyone. Prior to buying or selling a warrant, investors should receive appropriate training or documentation on warrants characteristics from their broker, from the Singapore Exchange or from one of the issuers. TRADING Central is not a broker-dealer. TRADING Central is not affiliated with the Singapore Exchange, the issuers of warrants mentioned in this site or their affiliates. Investors should exercise judgment and perform adequate due-diligence prior to making any investment. | | |
Selections are made from structured warrants issued by Supporting Parties.
This Newsletter is prepared, issued and disseminated by TRADING CENTRAL. Statements or information published in this Newsletter represent the views of TRADING CENTRAL and not of issuers or sponsors of the warrants mentioned in the site. In particular, any person reading such statements or information published in this Newsletter is deemed to acknowledge and agree that neither the issuers nor their affiliates shall be responsible for the issuance or contents of the Newsletter, nor have any of the issuers or their affiliates been involved in the preparation, review, approval or the dissemination of this Newsletter, including but not limited to, the selection of the structured warrants as set out in the Newsletter.
This Newsletter is not intended for distribution to, or for use by or to be acted on by any person or entity located in any jurisdiction where such distribution, use or action would be contrary to applicable laws or regulations or would subject TRADING CENTRAL, and the respective warrant issuers to any registration or licensing requirement.
The information contained in this Newsletter is obtained from sources believed to be reliable and accurate as at the date of publication. However, TRADING CENTRAL has not verified the materials, which may not be complete or accurate. Opinions, estimates and other information contained herein may be changed or withdrawn without notice. Any prices and quotes published in this Newsletter are purely indicative and for information purposes only. Indicative prices and quotes shown in this Newsletter may vary significantly from indicative prices or quotes available from other sources.
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Investment products are subject to significant investment risks, including the possible loss of the principal amount invested. Past performance of investment products is not indicative of their future performance.
The warrant issuers and their affiliates may from time to time take proprietary positions, and may have long or short positions or other interests, in the investment products. The warrant issuers and their affiliates are or may also be involved in other financial, investment and professional activities which may on occasion give rise to interests or a conflict of interests in respect of the investment products. The warrant issuers or their affiliates may make a market or appoint designated market makers to make a market for the warrants. The warrant issuers and/or the designated market makers make no representation nor can it give any assurance as to the liquidity in the trading of warrants as the warrant issuer or the designated market maker may be the only person quoting prices in the warrants.
This Newsletter is for general circulation only and is not an offer or solicitation to buy or sell, nor financial advice or recommendation for any investment product. It does not address the specific investment objectives, financial situation or particular needs of any person. Advice should be sought from a financial adviser regarding the suitability of any investment product before investing or adopting any investment strategies. None of the parties funding the publication costs of or supporting this Newsletter (the Supporting Parties) shall be liable to any Subscriber in any way for any liability whatsoever and howsoever arising. Each of the Supporting Party shall have the right under the Contracts (Rights of Third Parties) Act 1999 to enforce its rights under this Agreement.
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