StockWatch (Jan 28 – Feb 1, 2013): PSEi, PNX

 PSEi Weekly

 PSEi (Chart: Daily  Resistance: 6240  Support: 6080)

In the past 2 weeks the index has been volatile.  We can see in the chart that for the past 2 weeks, the index has been intermittently, for every 2-3 days, having a black(red) candle stick.  If that pattern is reliable, the index is due for another black candle within the week.

Even if we do not base it from the above observed pattern, we can already visibly see a decline of confidence with the market, seeing the RSI, MACD and the Stochastics moving down.

In the weekly chart, a possible hanging man is spotted on the last trading day of last week.  A hanging man is a bearish reversal.  The indicators does not clearly display the same sentiment as all of them are moving upwards, but looking closer, we can see that the RSI is now very much overbought giving credence to the hanging man candle stick.

Right now the index is moving in a tight upward channel between 6080 to 6240.  The 10 day Moving average is also in the same range.  The 10-day moving average has not been breached lower since the start of the year, so we are expecting this to provide strong support.  The index may still move higher next week, but do watch out if the index moves lower than the 10day moving average.  Hold the buying for the moment, and if the index moves lower than the 10 day moving average, start to sell. 

PNX (Chart: Daily  Resistance: 10.40   Support: 9.60)

PNX caught my attention due to its unusual white candle accompanied by large volume.  This seems to be a breakout of a channel, but its target price is already reached.  Plus, the RSI is now overbought.

This does present a possible opportunity, but it is not yet recommendable to buy now given that the RSI is overbought and the target has been reached.  It is possible however that this transforms to a flag pattern, so do watch out for that possibility.

For those who are risk averse, you can buy this stock as long as it does not go below support of 9.60.

StockWatch (Jan 14-18, 2013) : PSEi, TA, NIKL

 PSEi (Chart: Daily    Resistance: 6100    Support: 5960/ 5860)

The index has once again created a new high last week.   We are generally still on an upward trend, but expect some downward to sideways movement by next week.

Next support is near 5960 which is the 10 day Moving Average.

A rising wedge seems to be forming in the index.  This is a bearish indicator, so keep an eye on other signals that may form in the coming weeks such as bearish divergence from the MACD.

 TA (Chart: Daily  Resistance: 1.50/1.55   Support: 1.40/1.30)

TA has a flag formation, with a target price of near 1.55.   As of current, the stock is now near its target price.  There may still be some push left in this stock and may still reach the 1.50 to 1.55 level by this week.   For those who have this stock, be prepared to get off the ride near 1.50.

NIKL (Chart: Daily  Resistance:  20.65   Support: 19.20)

NIKL has been continuously rising since last week and even showed bullishness by creating a gap up on the last trading day.

A very good thing for this stock is that there is a large amount of volume supporting the upward movement.   So expect the stock to rise further.

This stock is a buy, however,  looking at the RSI, the stock is now very much overbought, so expect downward to sideways movement.

For those who would like to take part of the action, I would recommend buying the dips as long as the stock can keep its price above 18.50.  Sell if it goes lower than 18.50