JPHK Update (2010-12-23)

I will be travelling for a month, so I might not be able to update the blog everyday. I will definitely maintain the daily analysis starting from February.

Another 10% (2010-12-23 1997.HK analysis)

HSI managed to go back above 23,000 and did not complete its head-and-shoulder pattern. You can be partly relieved.

Today I found an interesting stock: Regent Manner International Holdings Ltd (1997.HK). The Group is principally engaged in the manufacture and sale of electronic products and the provision of related subcontracting services. (from aastocks.com)



So above is the daily chart of 1997.HK. The stock rose 10% yesterday. As we can see, it reached the last high at around 4.40. After such great surge, we may ask: will it go any further?

This level seems to be a pretty strong one; however, the low volume at lower level showed that corporate investors are still not selling their share, or at least have not started their mass selling yet. They would definitely lift the price again to gain themselves more profits.

The red line connecting the previous lows gives us some idea on the next resistant level, which is around 4.7-4.8. If the stock doesn't not retreat, then we can expect it will at least boost another 10% to around 4.8. Other the other hand, the support level will be at around 4.0.

JPHK Update (2010-12-22)

Going to jump? (2010-12-22 VIX analysis)

Above is the daily chart of VIX. Apparently, it has been falling, and reached the 8-month low three days ago, which is indicated by the lowest blue horizontal line.

The index has been dropping along the green downtrend line. Together with the upper downtrend line (red), I wrote it would jump when the index broke the pennant last week. However, VIX broke the red line but didn't jump as expected. Instead, it kept on slumping and reached the new low.

This level has a strong support, but as we can see, the level of 18 is also a very strong resistant. We should keep an eye on this level.

Once VIX breaks 18, the next resistant is shown by the purple up-trend line. Obviously, the longer time VIX takes to break the line, the higher level it will boost to.

Is it already the time for it to jump!?

JPHK Update (2010-12-21)

JPHK Update (2010-12-20)

JPHK Update (2010-12-20)

Two good news for the index (2010-12-20 HSI analysis)

There were two good news for Hang Seng Index last week:
1. On daily chart, the index managed to stay above the neckline. The situation wasn't that bad;
2. On weekly chart, HSI did not break the up-trend line, which was a support to the index.

Daily chart of HSI:


Basically, the head and two shoulders have formed. The next concern is whether HSI will drop below the neckline. If so, according to the pattern estimation, it will drop till around 20,500, which is around 8% plunge.

Good news is that last week the index once broke the neckline from above, but finally it managed to regain and closed above the neckline, at around 22700. The formation of head-and-shoulder pattern has not yet completed. At least we don't have to be afraid of the plunge of 8%.

Weekly chart of HSI:


Same as that last week, the green line is the up-trend support line. This provides great power to help maintain the index at current level and prevent it from falling below. It somehow protects HSI from forming the head-and-shoulder pattern.

Though HSI experienced slumps last week, the lovely green line helps set the rebounce of the index and finally the index closed above it. However, MACD and EMA are not looking too good. Volume retreated as well due to the uncertainties on Europe financial status.

If this line breaks, it also implies the successful formation of head-and-shoulder on daily chart. Then it is definitely a bad sign...

Important Economic Data (2010-12-19)

Not much important data next week. Ready to enjoy you Christmas!

21-Dec (Tue)
13:00 Bank of Japan Rate Decision (DEC) {Forecast: Unchange}
20:00 Canada Consumer Price Index (YoY: NOV) {Forecast: Decrease by 0.1%}

22-Dec (Wed)
17:30 Bank of England Minutes (DEC)

23-Dec (Thur)
05:45 New Zealand GDP (3Q) {Forecast: Drop by 0.1%}

source: http://www.dailyfx.com/

JPHK Update (2010-12-17)

Nice support at 22550.

Testing support (2010-12-17 China Mobile analysis)

HSI dropped 306 points to 22,668 yesterday. It broke the neckline on daily chart, so the next support would be at around 22,500 on weekly chart. This is the last defence line, if it breaks as well, a big bearish wave will be following.

China Mobile (0941.HK) faces a strong difficulty as well.



Above is the daily chart of China Mobile. It has reached the lowest point in the last six months. The red down-trend line further provides holding as well. This level is a strongly supportive.

However, there was a bearish cross of the moving averages (10SMA x 20SMA) few days ago. This was a bad sign. MACD has no sign of reversal as well.

If this level breaks, the next level will be at 71.3. You can consider short the stock or buy its put warrant (but make sure you choose a suitable one with good volatility and time sensitivity). Nonetheless, China Mobile is the second most important components in HSI and it follows the movements of HSI tightly. We should check both charts before making decisions on 0941.HK.

JPHK Update (2010-12-16)

European Concern (2010-12-16 EUR analysis)

There is growing concerns about Europe which casued a great slump in HSI. Well, it appears that it just always changes from "concern" to "relieved" and back to "concern", and the stock market just go down and up and down. Anyway, 27500 is an important support level for HSI. Watch out.

Regarding the European concerns, let's check the Euros.



Above is the 4-Hour chart of EUR. The 16-nation currency just broke the green uptrend line, and is moving towards the red down-trend line.

MACD is dropping, aligning with the bearish movement of the currency. There is still no sign of any reversal.

The red line will be the next support line. The level is around 1.313 until the price can finally get some support from further plunges.

It seems like the price would keep falling until the red support line due to the "concerns", but whether it will breakdown or not would depend on any news announced in the coming days.

JPHK Update (2010-12-15)

Bullish MA Cross (2010-12-15 HSBC analysis)

Above is the daily chart of HSBC (0005.HK). Here is a good news for it. The 10-day SMA has just crossed the 20-day SMA from above, which is a bullish signal. Probably there would be around few money dollars rise before dropping.

Volume is shrinking, which is a bad sign for HSBC. But it is somehow related to the unpredicable stock market recently, and investors are more worried. So on average the volume in the stock markets slump.

MACD is rising, which could possibly be a good singal. But as it approaches zero, it is possible for it to reverse its direction.

Back to the candlestick chart. There are two major trend-lines. The red one is the up-trend line and the green one is the down-trend line. The two lines just crossed each other and the price of HSBC is currently trying to break into the area between. This would be a resistance zone, which is quite a large one.

However, given the bullish MA cross and boosting MACD, I would expect a slight breakthrough into the area, and perhaps a bit false breakout. Then it will probably fall and head towards 72 estimated by the fibonacci projection. This might also be the trend of HSI.

JPHK Update (2010-12-14)

I should have sold 1229.HK before..

What a fall (2010-12-14 DXY analysis)

Above is the hourly chart of US Dollar Index (.DXY). It plunged several hours before and started to have some rebounces after reaching the previous low.

It is currently facing the resistance given by the purple pitch-fork, though it might not be too strong.

MACD and EMA has a bullish cross, support the break of the pitch-fork resistant. It would probably get back into the fork and start moving upwards.

The top of the fork and the red pennant which it broke before will be the next obstacles. Therefore, 80 will be the next resistant. This is also a psychological resistant.

If the index could not make it way back into the fork, which is quite unlikely, it would be sliding along the bottom line of fork and reach the previous low. This is a strong support and if it breaks, then the next support level will be at 78, suggested by the daily chart.

JPHK Update (2010-12-13)

A further step towards Head-and-Shoulder formation (2010-12-13 HSI analysis)

Last week was a quiet week, nothing important happened. HSI opened at 23,507 on Monday and closed at 23,162 on Friday. However, the index is in progress of forming head-and-shoulder pattern.
Daily chart of HSI:


We can see that the third peak has formed. The red neckline would be the next support level, which is at around 22,750. It would be a very critical level. As suggested by the head-and-shoulder pattern, if the index breaks the supporting neckline, it would drop as much as the distance between the neckline and the highest peak; hence, HSI could drop to as low as around 20,600 estimated by the pattern.

It would mean a 10% drop in index which is definitely very serious. Though MACD has been falling, it is still around zero now. This would not be a vital power supporting the index.

Weekly chart of HSI:


The index has moved a step towards the red uptrend line. This line is a support, which tells us that there might be a support at around 22,500. The shrinking volume and bearish cross of MACD and EMA give bad signals about HSI.

Combining both charts, if the index this week drops through 22,700, we don't have to make decision on whether to sell everything or short-sell stocks too quickly, as there will be a support at 22,500. It is possible for the index to have false breakdown. If the index drops below 22,500 at close of this week, then it would be a really really bad signal. We can then decide how to make profits on the coming bearish waves.

Important Economic Data (2010-12-12)

Not much important economic data released in the coming week

14-Dec (Tue)
17:30 UK Consumer Price Index (YoY: NOV) {Forecast: Unchange}
21:30 US Advance Retail Sales (NOV) {Forecast: Drop by 0.6%}

15-Dec (Wed)
03:15 US FOMC Rate Decision (DEC) {Forecast: Unchange}
17:30 UK Jobless Claims Change (NOV) {Forecast: Drop to -3.0K from -3.7K}
21:30 US Consumer Price Index (YoY: NOV) {Forecast: Drop to 1.1% from 1.2%}


source: http://www.dailyfx.com/

JPHK Update (2010-12-10)

Well gotta check each stock's target

Still some waves to go (2010-12-10 0915.HK analysis)

The index rose yesterday. So its really hard to predict the movement of HSI these days, but it is forming a head-and-shoulder pattern. Please remind that the neckline is at around 22,750 and if the index breaks it, the plunge will be very huge.

Anyway, before facing such a bearish market, we can try to dig some good potential small-cap stocks for short-term trading. I discovered one: LinMark Group 0915.HK



After breaking the red pennant, the stock surged crazily in late November and early December. We have missed this chance already. However, I think there would be a second wave coming.

First reason is that the stock did surge greatly in Jun10. Then during the plunge afterwards, the volume was not high. Corporate investors clearly were not selling their shares. They should be collecting and preparing for pulling the price to a higher level.

Therefore, after few months of consolidation, the price boosted again in late November. It is now moving towards 0.76. This is the first resistance level. The next one would be 0.87 which is the highest point.

But I expect that the price would go further than 0.87. I have thought of one opposing reason is that corporate investors were selling the shares during the consolidation period slowly, and lifted the price again to sell more in higher price.

However, the stock has been in this range since late 2009. I could not see much profits for these big investors. They would definitley require more profits for such a long time. Therefore, they would continue lifting the price upwards.

JPHK Update (2010-12-09)

Trigger? (2010-12-09 VIX analysis)

After a little breakout last week, the index returned back into the wedge. It is moving closer to the vertex. VIX touched the bottom line and rebounced yesterday, which look like that it would have another try to break the pennant from below. It is more likely to have a large breakout, but what would be the trigger? Extremely bad news from Spain and Portugal? War? Terrorist attack?

God knows.

JPHK Update (2010-12-08)

Still not the right time to buy 3303.HK

Huge Waves (2010-12-07 3303.HK analysis)

Well, HSI kept on moving upwards. Make sure you are aware of the next resistant level at around 23,700.

Today I suggest another small-cap stock to everyone which definitely worths your attention.

Daily Chart of 3303.HK Jutal Oil Service:


Jutal is a chinese phrase meaning "huge waves". Anyway, the Group is principally engaged in provision of technical support and related services for oil and gas industry and sales of equipment and materials, fabrication of oil and gas facilities and oil and gas processing skid equipment, provision of technical support services for shipbuilding industry and engaged in civil engineering business. --- from http://www.aastocks.com

As we can see on the chart, the price of 3303.HK tried to break the level of 1.18 twice but failed. Here comes the third trial. The big surge yesterday led the stock to break the red uptrend line, and move closer to the level of 1.18. This is a critical level, if it can break this, I will expect further boost to 1.37.

However, the volume was too great yesterday. Those who are optimistic on it might have spent too much on it which give less power for it to further rocket. The support will be around 1.12 which is the red uptrend line.

If it breaks 1.18 level and closes above it, I would add it into JPHK. Why not catch the huge wave created by this "Huge Wave"?

JPHK Update (2010-12-07)

Big Doji of 1229.HK. Let's see what'll happen tomorrow.

China IPOs in U.S. Slump Even as Sales Rise to Record

At a time when China’s government is trying to keep the economy from overheating, a record number of its companies are selling stock in U.S. initial public offerings.

Youku.com Inc., the online video provider whose name means “excellent and cool,” E-Commerce China Dangdang Inc., the country’s largest online book retailer, and three other mainland companies plan to raise a total of $703 million this week, according to filings with the Securities and Exchange Commission. The sales would bring the number of Chinese IPOs in New York to 39 this year, surpassing the 37 in 2007, data compiled by Bloomberg show.

While four of the ten best performing U.S. IPOs of 2010 have come from China, shares of the last four mainland companies that completed sales fell after the government raised interest rates and bank reserve requirements and said it may impose price controls. Youku.com and China Dangdang are offering stock at as much as five times the median valuation of their U.S.-traded rivals, data compiled by IPOdesktop.com and Bloomberg show.

“The market wants emerging market stocks,” said Timothy Cunningham, a money manager at Santa Fe, New Mexico-based Thornburg Investment Management, which oversees about $70 billion. “If they had come a month ago, these would have been incredibly hot, up a huge amount. They’re going to get a little more investor scrutiny.”

Youku.com, Tudou

Youku.com will offer 15.4 million American depositary receipts at $9 to $11 each today, the filing said. The midpoint values the Beijing-based company at 15 times projected annual sales, compared to the median of 3 times estimated 2011 revenue for 12 U.S.-traded Internet-content providers, data compiled by Marina del Rey, California-based IPOdesktop.com and Bloomberg show. It hasn’t posted a profit in the last three years.

China’s online-video market more than doubled to 621 million yuan ($93 million) last quarter, according to Beijing- based research company Analysys International. Youku.com had the largest share at 23 percent, followed by 19 percent for Shanghai-based Tudou Holdings Ltd., which filed for a $120 million U.S. IPO last month. Tudou means potato in Chinese and refers to a couch potato, Chief Executive Officer Gary Wang said in an interview in September.

‘Without Question’

Google Inc.’s YouTube, the world’s most popular video- sharing site, is inaccessible in China. The country had 420 million Internet users as of June, according to data from the government-sponsored China Internet Network Information Center. The U.S. population in 2010 ranged from 305.7 million to 312.7 million, Census Bureau data show.

“With China and the Internet, you have two areas that are getting a lot of interest,” said Scott Billeadeau, who helps oversee $18 billion at Fifth Third Asset Management in Minneapolis. “Without question you’ll have pretty good response” from investors, he said.

China Dangdang is offering 17 million ADRs at $13 to $15 each today after increasing the price range from $11 to $13, an SEC filing showed.

The original midpoint valued the Beijing-based operator of dangdang.com at 48 times annual earnings, based on third-quarter results, data compiled by IPOdesktop.com show. That’s 64 percent higher than the median of 29.3 for 11 U.S.-traded Internet retailers. Bloomberg data show. Seattle-based Amazon.com Inc., the biggest online merchant, trades at 38.8 times profit.

ChinaCache, SinoTech

The four Chinese Internet companies that completed U.S. IPOs this year surged an average of 57 percent in their first day of trading, the data show. ChinaCache International Holdings Ltd., a Beijing-based provider of content for business websites, posted the biggest first-day rally on U.S. exchanges in three years, jumping 95 percent on Oct. 1.

SinoTech Energy Ltd. which provides equipment to boost oil field production, posted the steepest drop among Chinese IPOs since the People’s Bank of China raised lending and deposit rates in October for the first time since 2007. The Beijing- based company slid 19 percent Nov. 3, the largest first-day fall for a U.S. offering this year, data compiled by Bloomberg show.

The PBOC increased banks’ reserve requirements five times in 2010, while the government said on Nov. 17 it may impose price controls to combat the fastest inflation in two years. China’s economy will grow 9 percent next year, three times as fast as the U.S., according to estimates compiled by Bloomberg.

‘The Driver’

Bona Film Group Ltd. of Beijing, China’s largest privately owned movie distributor, will offer 11.7 million ADRs at $7 to $9 each tomorrow, according to SEC filings. Sky-mobi Ltd., which provides applications for mobile devices from Hangzhou, China, is selling 7.25 million ADRs at $8 to $10 the next day. Lentuo International Inc., the largest privately-owned automobile retailer in Beijing, also plans to sell 7.5 million ADRs at $11.50 to $13.50 on Dec. 9, data compiled by Bloomberg show.

“Chinese companies are really going to be the driver of the IPO market,” said Michael Yoshikami, who oversees $1 billion at YCMNet Advisors in Walnut Creek, California. “Investors are buying the thematic trend of emerging markets, and they’re overlooking fundamentals.”

source: http://www.bloomberg.com/news/2010-12-06/recent-chinese-ipos-in-u-s-slump-even-as-offerings-climb-to-annual-record.html

JPHK Update (2010-12-06)

1229.HK surged 32% today, and it went as high as 2.75. It has already reached, or broke, the predicted level I said on last Friday. Clearly there was a resistant at around 2.38. However, we can still wait one or two more days to see whether it can break this level. If the price can successfully pass 2.38 and stay above it, the next resistant would be at 3.2.

Head-and-Shoulder (2010-12-06 HSI analysis)

As usual, let's have a bit update on Hang Seng Index and see how it would go this week.

Daily chart of HSI:


Though I had made wrong predictions last week, I found that the index is forming a bad pattern: Head and Shoulder.

After the two peaks before, with the former peak at lower level, the index currently reached the level of the first peak. Apparently, it was resisted and could not break that level last week. The two black candles could definitely show it.

22,500 would be a critical support level as it is the "neck line" of the pattern. If the index breaks it, the pattern is formed and we can expect a plunge in the index.

Good news is MACD and EMA just had a bullish cross and would probably give some confidence to investors. If HSI is not moving downwards, the next resistance level will be at around 23750, which is the level of the second-previous peak.

However, weekly chart suggests bearish.

Weekly chart of HSI:


The green line is the support up-trend line. Interestingly, the support level now is around 22,500, which is exactly the support level of the head-and-shoulder pattern in daily chart. Breaking this level would mean so bad in both charts.

MACD and EMA in weekly chart had a bearish cross. It might somehow signal a long-term bearish, and probably have a bit consolidation in short-term suggested by daily chart. Therefore, next week is still an unknown week. There will not be many economic data which can greatly affect the market, so the flucatuation should be smaller.

Good luck.

Important Economic Data (2010-12-05)

Not much to do with economic data in the coming week.

7-Dec (Tue)
11:30 Reserve Bank of Australia Rate Decision (DEC) {Forecast: Unchange}
22:00 Bank of Canada Rate Decision (DEC) {Forecast: Unchange}

9-Dec (Thur)
04:00 Reserve Bank of New Zealand Rate Decision (DEC) {Forecast: Unchange}
08:30 Unemployment Rate (NOV) {Forecast: Drop to 5.2% from 5.4%}
20:00 Bank of England Asset Purchase Target (DEC) {Forecast: Unchange}
20:00 Bank of England Rate Decision (DEC) {Forecast:Unchange}

10-Dec (Fri)
22:55 U. of Michigan Confidence (DEC P) {Forecast: Increase to 72 from 71

source: http://www.dailyfx.com/

JPHK Update (2010-12-03)

Nice start 1229.HK

JPHK

Buy 6000 shares of 1229.HK @ 1.77

Take a ride (2010-12-03 1229.HK analysis)

So the index surged another 200 points again yesterday, and my anticipation on the market this week was wrong. DJIA and HSI both break the 50-day Simple Moving Average, and SSEC is moving close to it.

Many small-cap stocks rose crazily these days, so its time to find any chance to make profits in short period. I found today a good small-cap stock: 1229.HK China Sonangol

This stock surged over 10% yesterday, and you might feel bad with it. But I do think the boost creates opportunity for it to climb even higher.

Let's check the daily chart of 1229.HK



Clearly, the price was brought to the resistance level 1.688 yesterday, and it is now critical time on confirming whether it would break or not. If the price breaks this level, theoretically the next resistant is at 1.827.

However, I would predict a further break up to around 2.2.

On 22-Sept, the price went up to as high as 1.80. Then due to strong selling power, it could no longer stay there and plunged. Clearly corporate investors were trying to test the resisting power at that level due to the shares bought by retail investors in June to August. If they are not going to lift the price, they would not have such action.

And these two days the volume was surprisingly high. The price broke all the 10,20,50-moving averages with only two candles, and together with the high volume, the momentum for this stock is large. This would definitely enhance the rise of the stock.

Therefore, if the price breaks 1.688 tomorrow, it has great potential to give you more than 15% in few days.

JPHK Update (2010-12-02)

Chance missed (2010-12-02 VIX analysis)

Crocodile (0122.HK) jumped another 17% yesterday. Though I have recommended it in my previous post in mid-November (Famous brand's unpopular stock), I failed in recognizing the time to buy it and missed the chance to make around 35% profits in a short period. Recently I have been working hard on my CFA Level I examination and I spend less time on tracking the market.

Anyway, last week I said the volatility would be likely to jump as it broke the downtrend resistant. Major stock markets did fluctuate a lot this week. So let's have a bit update on the Volatility Index.



Well the index seems to be fluctuating a lot as well. The volatility of the volatility surges :) However, undoubtedly the index broke the red downtrend line. It could drop back and test it, which has changed to support, but I would expect an increase instead.

MACD has reversed its movement to downwards, but still there is not bearish cross. Even if there is a cross, at this level, the bearish power is not that strong and the signal is not strong as well.

So it is likely to go higher, giving more extreme moves of S&P500 index, which would lead global markets to fluctuate as well. Just watch out.

JPHK Update (2010-12-01)

Bearish (2010-12-01 CNOOC analysis)

It's December everyone. Historic trends show that December is often a good month for the stock market, maybe due to the Christmas and everyone is in a good mood.

However, I could hardly see good signs for boost in stock markets in the coming days, at least in the first few trading days of this Dec. As I posted two days ago, I expected the HSI to keep on dropping to somewhere around 22400-22600.

Today I checked one of the components in Hang Seng Index --- CNOOC 0883.HK.



The stock price has bben rising along the red trendline for few months. Few days ago, the line finally broke. While staying below the line, the price struggled to climb back above, but obviously it failed. It shows that there is a very strong selling force at this level.

MACD and EMA are both moving lower, giving no reverse sign. I would be bearish on CNOOC. It seems like the next support is around 15.6.

But nevertheless, such stock has quite strong correlation with the market index. Once HSI reaches the support zone, we could not short this stock unless the index breaks the zone.