StockWatch (May 31- June 4, 2010): PSEi

PSEi (Chart: Daily Resistance: 3343 Support: 3095)

Looks like the battle between the bulls and the bears is still very much evident on the index. As we can see the index bounced from the low of 3093 to close with a large spread last Friday. However, again the resistance line from June 2008 is still blocking the index’s progress. We may be seeing another short upward move with the MACD crossing just a little above the signal line and then move downward again.

There is opportunity in the short upward movements of the index, but as can be seen in the chart, there a very obvious bearish divergence and it would just be a matter of time before the index moves further south, so be very cautious in trading a you might end up getting a stock at the top.

The triple top displayed in the chart did not materialize because of the recent short rally, but in the coming week’s trading, there is still another possibility of a triple top formation with the top forming again near the resistance line from June 2008. You may also view the recent formation as a sideways channel with the support near 3070. A break below this line might take the index down to below 2800.

StockWatch (May 24-28, 2010): PSEi, OM

PSEi (Chart: Daily Resistance: 3338 Support: 3158)

We may be seeing a possible power struggle between the bulls and the bears in action with the index. Currently the resistance line from June 2008 still hasn’t been broken but at the same time, for each instance that the resistance line stopped the advance of index, the 65 day MA has provided support.

The downward movement of the index might be coming to an end by next week as we see 2 gaps formed on the way down, an indication of a possible exhaustion. Also considering the last trading day of the index last week, we see a hammer candle stick formation, which is a bullish indicator if seen during the downward movement. So by next we may be seeing another bounce from the support of the 65 day MA. But it is still a wait and see if the index is able to move beyond the standing resistance line.


OM - Weekly Chart

OM (Chart: Daily Resistance: 0.013 Support: 0.010)

OM seems to be on the move to break a previous high of 0.13. Trading last Friday saw this stock with a large spread accompanied by large volume as well.

Zooming out of the picture, we can see that this stock maybe forming a rounding bottom with resistance at 0.013. If a breakout happens, expect a target price of near 0.020. Also looking at the weekly chart, we can see that the MACD has crossed above the center line and is opening wide upwards. This is a possible indication of the start of good things to come from this stock. But looking at the daily and weekly RSI, this stock is overbought already, so expect a possible downward movement anytime soon. As long as the MACD stays on above the centerline, this stock is good for going long.

StockWatch (May 17-21, 2010): PSEi, RFM, EEI

(Chart: Daily Resistance: 3342 Support: 3073)

The index reacted positively with the good turn out of the election. The index jumped from the lowest level last week to 3260 on the first trading day. However, again, the resistance line from June 2008 still seems to be a hindrance to the upward movement. Also, there seems to be no follow-through on the trading except last Thursday, but that was not sustained as trading last Friday was lesser.

For next week, expect a downward to sideways movement. Do observe the resistance line from June 2008 if the index is able to move further beyond that line.

Notice also that the MACD and RSI seems to be moving lower, while the index seems to be still moving higher, but a bit slower. If the MACD and RSI records a lower high in the following days, while registering a new index high, this may be signs of a bearish divergence and a signal to start going light.

RFM (Chart: Daily Resistance: 1.04-1.66 Support: 0.95)

Looks like RFM is on the come back, with a rounding bottom formation that broke out last Friday with large volume. Target price for the breakout is around 1.66. The only problem with the breakout is that it will have to negotiate a tough upward movement as the resistance from 1.04 to 1.66 is the large gap down that happened last Sep 2008. Also looking at the span of the rounding bottom which is nearly 1 ½ year, this gives us an idea that target price would take longer to be achieved. But for those going long, this would be a candidate where you could park your funds.

EEI (Chart: Daily Resistance: 3.75 Support: 3.34)

EEI seems to have broken out of a symmetrical triangle, with a target price of 4.0. Only resistance is 3.75, which is a previous high from 2008.

StockWatch (May 10-14, 2010): PSEi

PSEi (Chart: Daily Resistance: 3315 Support: 3060)

The index took a nose dive the previous week, forming a black candle with large spread that occurred last Wed. Trading last Friday broke support at 3132, but was able to close above that level.

The resistance at 3315, which is the long standing resistance from June 2008, is still intact

As seen on the chart, it looks like we have a small double top formation with the breakdown occurring last Friday when the index opened lower. The projected downward target level for the index is at 2940.

As of current the index has support at 3060 as evidenced by the white candle that formed on Friday’s trading. But what is unsure is how long this support can withstand the bearish environment with the MACD opening downwards and its impending crossing below the center line.

For the coming week, expect a sideways to downward movement. Sell for the time being. Those who were able to catch up some stocks last Friday, be prepared to sell when the market starts to dip once again.

StockWatch (May 04-07, 2010): PSEi

PSEi (Chart: Daily Resistance: 3315.61 Support: 3132.91)

The index moved further upward after a bounce from support near 3132. Last week, the index just moved sideways, unable to move further above the standing resistance at 3315 (dashed line) which is the long standing resistance from June 2008. So as of current, the resistance line from Jun 2008 has again proven its strength, moving above that line might not come in the near future given that the RSI is near overbought level again. Expect the index to move sideways anywhere in between 3132 and 3315.