StockWatch (Jan 25-29, 2010): PSEi

PSEi (Chart: Daily Resistance: 3133 Support: 3016/2979)

The bears were in control of the market last week with the index moving lower. The index is now forming a probable double top formation with the neckline at 2979. So the support at 2979 is the level to watchout for. If the index proceeds to break the support with large value turnover, then expect the index to head towards 2800 level. As of current the index is being supported at 3016, which is also the 65 day MA. Any upward movement of the market may be a good oportunity to lessen your position. For next week, I’m expecting the index to continue moving downwards and will probably be supported when RSI reaches the oversold level at 30.

StockWatch (Jan 18-22, 2010): PSEi

PSEi (Chart: Daily Resistance: 3133 Support: 2979)

Last week the index stopped just a little above the previous high which means next week would be a crucial point whether the index would continue with its upward movement or not. I believe that there is still room for a few more upward movement based on the RSI, which has not yet reached the overbought level and also based on the MACD which is still opening upward. But then again, trading action last Friday closed lower and accompanied with a relatively large value turnover so trading next week might follow suit. So we have a mixed signal here, but all this means is that we should be more cautious next week. Should the index move south, watchout for support at 2979. Watchout also for a possible double top formation if the support at 2979 is broken.

StockWatch (Jan 11-15, 2010): PSEi, EEI, ALI, CYBR, AT

PSEi (Chart: Daily Resistance: 3077/3130 Support: 3015/2979)

First happy new year to all of you! This is my first post for the year 2010.

I was actually hoping for a stock market blast on Dec due to window dressing, but the market action last Dec was not as expected. As of current the index is still moving sideways, and previously every sideways movement comes with a short rally that would bring the index higher. That is something to watch out this time because the index moved lower last Dec and hasn’t been able to move higher than 3130, the previous high from Dec 2. If the index is able to move higher than the previous high, then good for the index, because it means there is still some steam left, but if it is unable to move beyond the previous high, we better lessen our positions as this could indicate the start of the market’s descent.

The market in general is still bullish as indicated by the RSI always pulling up when it reaches the 50 level. But for how long the index could sustain this is left unanswered.

Also another thing to watch out is the MACD crossing below the center line. As of current the MACD is still safely above the center line, with the MACD opening upward so we can probably expect further upward movement by next week. Again, since the index has been moving sideways, trading strategy would be to range trade and as much as possible avoid going long.

EEI (Chart: Daily Resistance: 2.80 Support: 2.40)

EEI had a large volume and large spread on Wed and Thursday last week. I could not see any formation, at the very least, it could have broken out of a sideways channel with a target price of above 3.0. Currently the stock has already reached 2.80, so it is not a good idea to buy at the current level. This stock had a correction on the last trading day last week, and the good news is there was not much volume on the downward movement. So this means a lot are still hoping for this stock to move higher. Try to wait for the stock to move lower near 2.50 to 2.60 level before buying. Also watch out for the volume of the downward movement. Larger volume on the downward movement means you should avoid this stock.

ALI (Chart: Daily Resistance: 12.75 Support: 10.50)

Watchout for ALI as the MACD tries to cross above the signal line and the center line as well. Trading last Friday was accompanied with a considerable large volume. The 65 day moving average is currently blocking the upward movement, but I think this will easily be surpassed by this stock. Again keep watch of the volume for signs of weakness.

Other stocks:

AT and CYBR seems to be moving with volume. CYBR is currently overbought but this can still move towards 0.75, which is a previous high. AT also had large volume last week and it can still move higher, only problem is that it is already overbought. On both stocks, you can probably wait for a return move before buying.