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Let us ride the bulls and hunt the bears and also hunt with the bears !!!

Happy Trading.

DJIA Log Scale Chart Review 22 Jan 2010

0n my earlier posting on 31 Dec 2009 I mentioned that there are other faint dotted projection lines plotted on the chart that I will not comment on unless the Bears capture the bold red triple support lines which forms the first major Bulls defense embattlement against the Bear Raiders. Bears have capture this defense embattlement and those projection lines are now the next support zones as seen in the log scale chart.

11 Jan to 20 Jan 2010
On these days the DJIA venture above the bold green major down trend resistance which is being projected from the Oct 2007 peak.

21 Jan 2010
Blue trendline break down confirmed after the whole candlestick bar falls completely below the blue support line.

22 Jan 2010
Red triple line support zone taken out together with light green channel support. Immediate support is the orange channel. Next support is the dark grey channel and the dark green dotted line 100 days simple moving average line.If the key psychological round number 10000 support fails expect a drop to retest the 23.6% Fibonacci retracement support.

However, if a successful rebound happens the red triple support turned resistance zone and light green channel will act as a resistance buffers

DJIA Rising Wedge Broken

Giant red rising wedge broken and closes slightly above 50% Fibonacci Retracement.
Further weakness will plummet DJIA towards the green major down trend resistance turned support line. Support failure here will mean more downside towards 38.2% Fibonacci Retracement.

However, if DJIA rebounds immediate resistance is the lower rising wedge support turned resistance line. A breakout here will challenge the previous peak at 10729.90 and continue its upward movement within the wedge again.

Stay alert and be nimble as DJIA Dolphin Flipping is most likely going to continue in the near term.

ChinaEratat Dragonfly Testing Spring Board Channel

Dragonfly candlestick taking off from red channel launching pad perhaps? Judging from past experience as shown on the chart an extremely high probabilty that history will be repeated here. A successful take off will target the blue channel as the flight destination.

Yanlord Testing Major Support Trend Lines

13 Jan 2010
Price breaks below 200 days simple moving average. First signal that trend has change to bearish.

15 Jan 2010
Clear break from 2.12 support beam of dome structure. Second sign that bear has come to party.

Now waiting for the final confirmation that the bear is here to stay. A break of the blue bold major support lines will confirm that the bears have taken residence at Yanlord.

A test of the green dotted support line is imminent. Any weakness here will cause a slip down to the next red dotted support line. Any upward retracements will probably be resisted by former supports and turned resistances.

Stay alert and be nimble if you intend to trade counter trends instead of the easier trend following methodologies.

Rotary Spinning Top

Two indecisive candlesticks a gravestone doji and a spinning top are testing the pink resistance zone. MACD. RSI and stochastics all showing weakness. A break down from lower blue channel support will iniate fall towards green support zone. Light blue zone is a major support area.

Upward immediate resistance at 1.15 followed by red upper channel boundary. Next is the narrow green channel resistance and a break above 1.20 will challenge the blue upper channel resistance boundary.

Genting Shooting Star Variant

Shooting star variant spotted inside green channel. High chance of a retest of lower green boundary support as profit taking sets in. Price movement most probably will be fluctuating within the green channel.

Immediate support lower green channel boundary. Next support pink zone followed by major light blue support zone.

Immediate resistance upper green channel boundary. Next resistance 1.35 followed by 1.40 and upper blue channel boundary.

Z-Obee testing dual support

Having demolished both the green support zone and the red channel support on 15 Jan 2010 price stopped at the blue channel support on Friday closing. It has just broken below the blue channel support and is now testing the dual support comprising of the light blue support zone and the mid Bollinger Band support. It will most probabilty be confined between the green resistance zone and the light blue support zone. However, if further weakness should prevail the next support will be at 22 cents 38.2% Fibonacci retracement followed by 20 cents 50% Fibonacci retracement support levels.

DJIA Flipping at Major Trend Lines

14 Jan 2010
First time the index closed above the dark green major down trend resistance line since the Oct 2007 all time high peak.

15 Jan 2010
Unable to hold above dark green line which has just reverted back to resistance from support. Bottom tail of candlestick pierces blue support but manages to close above this support line.

If selling pressure continues on 19 Jan 2010 a drop towards red triple support zone is inevitable. Dow Jones Index needs to mount a strong surge back above the dark green major reisstance line to confirm and continue the 2009 bull run into the 2010 Year of the Roaring Tiger.

Epure Waiting for Icebreaker

On the weekly chart the surge in price challenged the dual resistance intersection point of the lower green channel boundary and the upper red channel boundary last week. This momentum waned as profit taking set in this week. The next few weeks may see a cooling off period when price consolidate within the red channel. The new all time high of 91.5 cents is the new milestone to crack. Major iceberg blockade for this water stock is the green resistance channel.

Ying Li Bollinger Band Squeeze

The Bollinger bands are coiling very tightly which indicates the stock is trading in a narrow range. This is the trigger to watch for a price breakout or breakdown. Many times, large rallies begin from low volatility ranges. This is the calm before the storm. Trading will continue within the upper pink resistance zone and the lower green support zone range until a clear strong move emerges. This move out of the range will be challenged by the red channel support and resistance boundaries.

Stochastics, RSI and MACD still falling and price may retest the 50% Fibonacci Retracement support and the green support zone. Current outlook favours a downward bias and the green defence zone must hold to prevent slide towards the lower red channel support boundary.

Yanlord Dome Collapses

Kudos to those who heeded to my warning posted on 29 Dec 2009 of the imminent crash of the rounding top formation. Break down of 2.12 support confirmed. Immediate support is 2.00 and the immediate resistance is 2.12 the support turned resistance beam of the dome. High probability of a drop towards the blue channel. Stay alert and be nimble.

Financial One Stabbed by Pitchfork

The news about the company's plan to list unit Chailease Holding on Taiwan Stock Exchange resulted in a gap jump which was blocked by the double resistance comprising of the upper resistance of the Andrew Pitchfork and the upper orange channel. The critical support at 60 cents must hold in order to maintain upward bias. A break of 60 cents support confirms the adage that says buy on rumours sell on news.

Yangzijiang Triple Divergence

Caution Stay Alert

MACD, RSI and stochastics showing divergence pattern. Ship sailing against undercurrent. Need to clear 1.25 strongly to challenge 1.28 double top formation. Be nimble in case undercurrent overwhelm ship and cause change of bearings towards 1.20 again. A strong break of the light blue support will confirm the double top formation.

Mermaid Maritime Encounters Great Barrier Reef

Major red down trend resistance line on weekly chart obstructed Mermaid upstream swim. Blue up trend aupport line still intact. Need Bull Whales to help Mermaid break through the barrier reef and continue upstream towards 90 cents followed by $1.00 and mount an attack the Polar Bears pouncing along the green resistance line.

However, if the Polar Bears attack tomorrow then Mermaid will retreat down towards 80 cents and swim further down stream towards the red lower channel support.



On the daily chart a doji is testing the green support zone and the upper blue channel support boundary. If the strong down stream current continues a test of the bold red mid Bollinger band support followed by the lower blue channel support is inevitable. Next support is the green lower Bollinger band.

If Mermaid manage to enlist the help of Siren to lured the mariners from the sea blockade at the red channel and blue upper Bollinger band the next resistance will be will $1.00 followed by $1.06 .

China XLX Doji near 50% Fibonacci Retracement

24 Dec 2009
Doji started the rebound from 56.5 cents low.

30 Dec 2009
Climb within orange channel blocked by light blue resistance zone and red channel upper boundary resistance.

31 Dec 2009
Bears trying to regain the channel crossover hallowed ground from the Bulls.

4 Jan 2010
Bulls rampage snapped 3 resistance barriers in a single day. The 3 obstacles consisted of

1. Red Upper Channel Resistance Boundary

2. Light Blue Resistance Zone

3. 50% Fibonacci Retracement Resistance at 65 cents.

5 Jan 2010
Topping tail doji was challenged and stopped by the green resistance zone and the 38.2% Fibonacci Retracement at 71 cents.

7 Jan 2010
Retested light blue resistance turned support zone.

11 Jan 2010
Shooting star unable to clear green resistance zone blockade.

13 Jan 2010
Doji retesting triple support comprising of

1. Light blue resistance turned support zone.

2. Orange channel lower support line

3. 50% Fibonacci Retracement at 65 cents

Triple support failure will slump price to next support at green internal channel line and may retest 60 cents if there is no Bull buying interest.

However. a successful rebound from triple support will mount a surge towards the green resistance zone followed by the upper channel resistance boundaries of the blue, green and orange channel formations.

China Auto Electronics Potential Cup Within Cup Formation

A potential cup within a cup pattern is forming on the weekly chart. A red cup and handle is about to be created. A similar small blue cup with handle pattern was confirmed with a breakout in the second week of Aug 2009. Price surged higher and higher every week until the last week of Aug 2009 when it ended with a weekly doji candlestick formation.

Since late Aug 2009 price has been trading within the falling wedge formation until this week when it broke out with increasing volume. Weekly stochastics has just crossover in the oversold region and RSI is trending higher after crossing the 50% mark last week. MACD bullish crossover is imminent. Immediate resistance is the red upper channel handle of the red big cup. Next resistance zone is the doji top at 19 cents to the psychological round number barrier at 20 cents.

A powerful breakout above the handle of the red cup will probably result in a similar upthrust as indicated by the light blue oval candlesticks formation. A consecutive weekly rise will challenge the 25 to 27 cents resistance zone.

This potential cup and handle formation needs to be confirmed with a breakout above the upper red channel and it will be invalid if price drops below the lower red channel.

CapMallsAsia testing 61.8% retracement with channel support

Hourly chart is being used instead of daily chart because this new IPO stock has limited trading bars. As seen from the hourly chart the last candlestick is resting on the 61.8% Fibonacci retracement at 2.43 which is also the intersection point of the green and orange channel support lines.

Both the RSI and stochastics are hovering just above the oversold region and appears weak and may fall further. Retest of both the green channel followed by the light blue support zone is unaviodable if buying interest does not return tomorrow.

Immediate resistance is the lower red dotted channel boundary. Next resistance is the 50% Fibonacci retracement at 2.49 and the upper orange channel around 2.50 followed by blue upper channel. Strong resistance is expected around the 2.55 to 2.60region.

China Taisin Gap Up with Gravestone Doji at Mid-day Closing

APPROVAL AND ADMISSION TO AMERICAN DEPOSITARY RECEIPT exuberant gapped price to test red channel resistance in early morning trading. However, this buying frenzy was met with Big Bears Selling resulting in an equilibrium state for the early morning trading session as indicated by the volume distribution chart. Mid-day closed with a gravestone doji and will continue to fall to narrow the gap in afternoon trading if Big Bulls do not return later in the day. Late morning buying was done only by retail traders thus price will drop towards the light green support zone if there is no support from the Big Bulls.

Sinotel Spinning Top Testing Resistance

24th Dec 2009

Hammer rebound from quad supports consisting of

1. Lavender support zone

2. Red lower channel support

3. Green upper channel support

4. Blue lower channel support


29th Dec 2009 to 31st Dec 2009

Unable to close above the light blue resistance zone even though it pierced this zone briefly on intraday trading on 30th Dec 2009.


4th Jan 2010

Finally managed to close above the light blue resistance zone with a strong closing near the high of the day.


5th Jan 2010

Price flight clipped by dual immediate resistances comprising of the upper blue dotted channel and the pink resistance zone. The spinning top candlestick formation indicates indecision with bulls and bears forces ending in equilibrium. Further ascent requires strong buying interest to mount a challenge towards the red upper channel boundary and the green resistance zone. Immediate support is the light blue resistance turned support zone. Next support is the red lower channel support followed by the green dotted channel.

Raffles Education Breakout Above Resistance Zone

Chronology of Events

18th Dec 2009
Rebound from lower green channel support

21st Dec 2009 to 23rd Dec 2009
Confined inside the green channel

24th Dec 2009
Breakout above green channel resistance zone

28th Dec 2009 to 4th Jan 2010
Trapped inside lavender resistance zone and blocked by mid Bolinger Band resistance

5th Jan 2010
Breakout above lavender resistance zone. Immediate resistance is at 42.5 cents 61.8% Fibonacci Retracement. Next resistance is the upper red dotted channel boundary followed by the upper Bollinger band resistance and the orange channel. Immediate support is the lavender resistance turned support zone.

Genting RSI Altimeter

With new trading data provided since the last update some realignments, addition and removal of channels were necessary to furnish a better chart description of trading development. The immediate resistance is 1.30 and a breakout here will trigger a move above the upper boundaries of both the red and green dotted channels and proceed with the climb within the light blue steep channel.

Use the RSI as an altimeter to monitor this movement. A RSI break below 70% and the dual support lower green channel boundary will precipitate a price dip. The uptrend remains intact as long as the lower boundary of the bold blue channel on the price chart in not broken.

From the study of the volume distribution chart we can see that there was slightly more selling from the Big Boys in the early morning trading session. Late morning and early afternoon trading sessions saw matching buy and sell from the Big Boys. A surge of buying came from the Big Boys during the late afternoon trading session.If this buying interest continues tomorrow there is a high probability that the 1.30 resistance will be taken out. However, if buying dwinble a retest of the lower green dotted immediate support channel boundary is unaviodable. Next support is the lower red dotted channel boundary.

SGX Best Performing Stocks as at 31st Dec 2009

Table above is the result of Amibroker Exploration to find best performing counters in the last 260 days which is about one year. Ranking is based on percentage change of closing price in comparison to the lowest low price for the last 260 days.

Percentage Change of Closing Price Formula = ((Latest Close Price - Lowest Low for the last 260days )/Lowest Low for last 260 days) * 100

New IPOs with less than 260 days are also included. Warrants are excluded.

Strait Times Index 2010 First Hurdle

The STI Index has transformed the double bottom formed by the troughs in October 2008 and March 2009 into a cup and handle pattern as shown by the weekly chart. A breakout above this pattern in mid July 2009 marked the beginning of a journey from the lower blue channel boundary via the green flag channel towards the upper blue channel boundary.

Having cleared the blue, red and green dotted resistance lines during this upward climb the STI now faces it first hurdle for 2010, the upper boundary of the blue channel. Breakout above this immediate resistance will empower the next ascend to the 3000 milestone and mount an advance to the upper red channel boundary.

However, if the DJIA 120.46 points dip on new year eve extinguishes the raging flames of the bulls a retest of the red dotted resistance turned support line is inevitable. Support failure here will result in a tumble back to the blue dotted internal channel line and the lower green channel support boundary.

DJIA New Year Eve Retreat

2010 new year celebration mood was dampened by a 120.46 points fall in the Dow Jones Industrial Average. A gravestone doji marked the high for 2009 on 29th Dec 2009 and was confirmed the next day by a tiny dragonfly doji that was formed just below the earlier doji. Any hope of a higher year end closing was dashed when these two indecivise candlesticks formation decided to invite the Bears to join their new year party.

The Bears party on new year eve has diminished the probability of the Bulls to retest the bold dark green major down trend resistance line located at the top right hand corner of the chart. This major down trend resistance line was projected from the Oct 2007 peak. It must be demolished to herald the continuation of the bull run into 2010.

With the 120.46 points drop on new year eve expect an imminent test of the immediate bold blue support trend line when market opens on 4th Jan 2010. Support failure here will plummet DJIA to the intersection of lower support boundary of the bold light green channel and the upper support boundary of the bold red triple support lines. The zone formed by the bold red triple support lines represent the first major Bulls defense embattlement against the Bear Raiders. Take note that there are other faint dotted projection lines plotted on the chart that I will not comment on unless the Bears capture this first bull defense zone.