SGX Insider and Substantial Shareholder transactions for 19 - 23 Mar 07 & Market Commentary
Hi all,
Here are the more significant Insider and Substantial Shareholders transactions reported on the Singapore Stock Exchange in the past week:
The number of sell transactions last week have increased relative to the week before. Directors of Allgreen Properties and Hotel Properties are still selling their stocks. Directors of Cosco are also selling.
ASIAN MARKET COMMENTARY
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The Asian market was in rally mode in the past week as the Hang Seng and the Straits Times Index recovering more than two thirds of the big selldown. The weekly chart of the Nikkei suggests that the following weeks might be bullish because of the oversold stochastics. But that's not to say that there will not be down weeks or that a selldown might not materialise. All we have is a probable direction and will still need to adjust our analysis be flexible to what the market does.
US MARKET COMMENTARY
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The big rally last week was due to the report that existing home sales in February rose alot more than expected, causing relief that the economy might do better than expected if the property market holds up. However, that would also mean that interest rates might not come down as soon as expected.
SHORT-TERM OUTLOOK
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Last week I mentioned that the ideal situation was for the NASDAQ to come down a little more so that the probability of rally increases, but the market decided to rally some more instead, sending the stochastics back up to overbought territory. And when the market did not behave as expected, it's better to wait for setups with a higher probability of success.
It's not easy to try to comment on the short-term outlook because I'm only updating my blog on a weekly basis. If anyone wants to trade using the short term indicators on the chart that I post, it may not be possible since the day-to-day changes in the market can be quite unpredictable. Don't get me wrong, it's possible to have an idea of the direction of the index with quite a high degree of accuracy, but it requires a day-to-day tracking of what's happening. I will be starting a 'sticky' section on this blog as to how I do a day-by-day analysis of the NASDAQ Composite Index using the short-term indicators.
On the close of last friday, here's what the short-term indicators are telling us:
(1) NASDAQ Market Breath Oscillator 2 : currently @ 0.05, down from a high of 0.5
(2) Volatility Oscillator : -0.19
(3) Put-Call Ration Oscillator : -0.1
(4) Stochastics Oscillator : Rising, now >90
(5) Put-Call Ration EMA : Falling
(6) CBOE Equity Options Volume : Falling
A neutral reading on the MBO and oversold stochastics suggest that the market is neutral to bearish
Low readings on the volatility and PCR oscillators and oversold stochastics suggest a short term top
Falling PCR and options volume trend suggests that sentiment is bearish
So on an overall basis, the index looks to be topping in the short-run.
MEDIUM-TERM OUTLOOK
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The NASDAQ closed higher on the weekly chart, breaking above what seems to be two small hammers on the previous two weeks. Similar to the Nikkei Weekly chart, the stochastics for the NASDAQ composite is also in oversold region and the probability of a rally over the next few weeks is higher than a selldown. Integrating the short-term and med-term outlook, the short-term top would play out first and then followed by either an up or sideways move.
The NYSE has just released the margin debt data for Feb'07 and here's how things are shaping up on the monthly indicators
The NASDAQ and Consumer Sentiment rate-of-change have both turned from their peaks since Dec'06 and Oct'06 respectively, whereas the Cash-Debt Ratio is still in the historically high region. Only the Retail Sales rate-of-change have yet to reach its historical high level.
Have a gd week!
posted by SmokingFlax @ 4:38 PM
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