StockWatch (Sept 24-28, 2007): PSEi, Mining, WIN, SMPH, BSC

PSEi (Chart: Daily Resistance: 3460/3580 Support: 3280)

The index is near the 61.8% Fib retracement at 3460 acting as resistance which is also the 65 day MA. The strength of the bulls will be tested at that resistance level. Now in order for the bulls to win there has to be an increase in buying sentiment. However, on plotting the slope of the On Balance Volume line, it seems that there is only mild buying compared to the intense selling that happened on the downward trend. Probably a lot are still waiting for more signals to confirm the bullishness of the upward move. As of current we already have one bullish signal which is the MACD crossing above the center line. If the index is able to move above the 61.8% fib retracement, this can also be another bullish signal. Also another upcoming resistance would be the lower end of the gap formed last July at 3580. With these upcoming resistance levels and mild buying sentiment on the upward move, it would be best to keep watch of your stops. It’s definitely a wait and see if the resistance will be easily taken out by the bulls.

Mining (Chart: Daily Resistance: 7040 Support: 6370)

Mining sector is very bullish with MACD crossing above center line. The slope of the upward move is very steep accompanied by increasing volume. However, as clearly seen in the chart, the mining sector needs to take a breather. It cannot sustain a very steep slope forever and looking at the RSI, it seems that the breather will happen anytime soon.

WIN (Chart: Daily Resistance: 0.39/0.46 Support: 0.33)

WIN has broken out of a small symmetrical triangle. Target price is 0.50. If the target price is reached, with high volume, this means a break out of the outer symmetrical triangle with a TP of 1.00, but this is still far away and still needs to be confirmed by a good breakout volume.

SMPH (Chart: Daily Resistance: 11.50 Support: 10.25)

SMPH is forming a symmetrical triangle. Breakout above 11.50 needs to have a good volume. Target price is 15.00.

BSC (Chart: Daily Resistance: 0.38/0.40/0.46 Support: 0.30)

BSC showed signs of positive divergence. RSI and MACD logged a higher low, while price logged a lower low. Trading last Friday has an increase in volume. There is no area pattern, so our basis for selling is only the Fib retracement at 0.40 (38.2%) and 0.46 (61.8%).