STI close at 1692.55 today, down by 57.12
its still going down, among them, i would like to talk a bit on DBS, which is a stock that have been hovering ard the $10 mark.
Technical point of view:
Alright lets look, the two black arrow is pointing the two lines that made up trend area, lets not look at the long white candle because the close of the day still stay within the area of $10 and $12, now, when price reaches $10, it will slowly go up to $12, and after that down to $10 again, much like a wave, if everything remain the same. However, if either line is broken, it will lead a price increment or decline.
Now what is certain is that if $10 is broken, we shall “short-sell” because the support line is broken, and it usually lead by a decline in the price.
After that take a look @ MACD indicator, red line signal increase, blue indicate decrease. If red line cut above blue, it signal that the prices will go up, if it intercept and go downwards, its time for us to sell, as it signal a decline.
ROC, it is the same thing, green line indicates increase, and blue line indicates decrease, when Green cut above blue, it indicate a increment, and vice versa. However, roc is more volatile, and there is more study towards the green line movement. i will introduce it next time.
RSI usually i take it with a pinch of salt, its quite volatile, and is not a good indication to depend on to sell or buy
stochastic, on the other hand, to me is the more reliable one, blue for increment, and red for decline, and the way to interpret is the same.
its important that more indicators act in the same way, and give the same signal, look for more confirmation, and evidences that do not confirm. do not just look at the confirming factors.
Therefore obviously the price will not face major price movement upward in the near term, from the current technical point of view.
DBS now currently with EPS 1.05 down from previous 1.7 from previous quarter. clearly just from this, it isn’t really a good choice. P/E ratio is only 9.4, which is low, and P/B ratio, if its calculated correctly is only 0.6, which all showed that DBS is maybe undervalued, or facing some kind of trouble, but rule out the latter, i believe its undervalued because of the current crisis, and it greatly affected all the finance institution.
therefore the picture might provide a chance for the entry for DBS, but when is the right time? it might not be now, if the support line at 10 is broken, it might plunge further. =)
