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N.B. Above Chart is abstracted from
NextView Program
Last week we said that, "Although last Friday's Unemployment
data was the worst so far, market managed to recover by end of the day. This
had shown to us that there are some more upside in the coming week. Plus the
fact that next Friday will be a public holiday in USA, a pull back may be
postponed till the week after. With 1st quarter reporting season starting
next week and some important economic data coming next week, the market may
be volatile. For corporate earning reports, we have on Monday Immucor,
Tuesday Alcoa, Thursday Chevron Corp. As for economic data, we have on
Thursday Jobless claims, Friday February U.S. trade balance. Plus Wednesday
the Federal Reserve will release the minutes of the March FOMC meeting. We
expect DJIA to continue rally in early part of the week and could be
challenging the 8250- 8400 level, before a correction emerge by middle of
the week." True enough, DJIA continued to rally and had again managed to
stay above 8000 on Thursday closing ahead of Good Friday holiday. We also
said that, As for STI it is likely to move up in the early part of the week
to 1850- 1880 level before correction emerge by middle of the week. In
Singapore, the blue chips rally may be pausing soon and give way to second
liners and S chips rally in the coming week." Again, we were right to the
dot, S chips and second liners had started rally since last Monday!" So,
what could happen next week, giving that we had a good rally for past four
weeks!
We could expect volatile market next
week, for we have big major banks announced their 1st quarter results and
some important economic data to be released. With many analysts calling for
a correction two weeks ago, we had been saying that DJIA could be heading to
8250- 8400 level before seeing some pull back. Indeed we were right and DJIA
now looks increasing possible to challenge the 8250- 8400 resistance next
week. There are 29 S&P500 companies announcing their 1st quarter result next
week. Starting with Tuesday Johnson & Johnson, Intel Corp and Goldman Sachs,
Thursday JP Morgan Chase, Google, Friday Citigroup, General Electric. All
these big companies results will have direct impact to the market. On
economic data, we have Tuesday PPI and Retail Sales, Wednesday CPI and New
York manufacturing survey and housing market index, Friday Consumer
Sentiment. All of them will make the market even more volatile! We expect
DJIA to continue its rally in the early part of the week towards 8250- 8400
levels. Once it has done, the market will likely experience some correction
by middle to end of the week. The buy on rumor sell on fact may be is the
name of the game this time. As for STI it is likely to move up in the early part of the week
to 1880- 1920 level before correction emerge by middle of the week. In
Singapore, the blue chips rally may be slowing down this week, while S Chips
and second liners shall remain as the focus point. I would not surprise if
the 3rd liners may start to move soon. As
such, for mid term
customers who had followed my email advise to purchase on 3rd March, and
subsequently added some stocks on 6th April, you may want to consider taking
some profit from the table, and wait for a pull back before re-entered
again. As for shot term investor, you may
participate on the long side, for I believe a rotating play shall continue.
The following are the support and
resistance to watch for Dow Jones, Hang Seng and Nikkei next week.
Dow Jones Hang Seng
Nikkei
Resistance 8250
15150 9068
Support 7750
14276 8850
As for STI the resistances and supports
are as follow:
Resistance: 1830, 1850, 1880, 1920, 1960
Support:
1800, 1780, 1717, 1690, 1660, 1630
Events To watch For The
Coming Week:
- The movement in Dow Jones
Industry and NASDAQ..
- The
movement in currencies, oil and commodities price.
-
The early corporate earning results on Tuesday Johnson & Johnson, Intel
Corp and Goldman Sachs, Thursday JP Morgan Chase, Google, Friday
Citigroup, General Electric.
-
The economic data such as Tuesday PPI and Retail Sales, Wednesday CPI
and New York manufacturing survey and housing market index, Friday
Consumer Sentiment.
The following are two
possible wave counts on STI as at to-date:
- Preferred Count (60% probability)-- bullish count
My preferred count calling for a
top at 2502 (on 7/1/2000) as wave ((1)), it then follow by a two year
sell off on wave ((2)) to 1197 (on 28/9/2001). The index had then entered
into an impulsive wave ((3)) that ended at 3906. We are now in the
development of wave ((4)), of which we expect it to be a big triangle
formation that take about one to two years to complete. The recent sell
down is the first leg of wave ((4)), which will take a form of a-b-c and
reaches the potential target of 2770, as the wave (a) of ((4)). The
index will then continue to develop the (a)-(b)-(c)-(d)-(e) triangle
formation.
- Alternate Count (40% probability)--
bearish count
My alternate count calling
for a top at 2502 (on 7/1/2000) as wave ((1)), it then follow by a two
year sell off on wave ((2)) to 1197 (on 28/9/2001). The index had then entered
into an impulsive wave ((3)) that ended at 2666 in May 2006. The index had
then entered into wave ((5)) that ended on 3906 in October'07. We are
now in the downtrend bear market, which will last for a few years!
Although this count remains as the least chance as compare to my
preferred count. If the index breaks below 2776 convincingly on very
high volume, the odd on bear market will significantly increase.
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