The market has been extremely resilient. It didn't even pull back to the first strategic level I mentioned this morning. STI recovered from a day low of 1,853 with a loss of 44 points and ventured into positive territory at day end. The close is 1,905 with a gain of 8 points. Volume traded is tremendously high at 3.52 billion shares worth $1.66 billion. It is obvious that how much the rally has extended to the penny stocks.
We can all see how strong the buying interest is nowadays. Though I feel it is quite crazy that these people have nothing else to play and started speculating on the penny counters (definitely not my forte), I think it is worthwhile to note this complete change of sentiment. Just a few months ago, many people want to have nothing to do with stocks. Now they are rushing to buy even the second-liners and pennies etc. This is a very obvious signal that the market had seen its worst already. And the truth is, with such high volume traded these few days, if not weeks, I think the market has little chance to get sell down fiercely unless something drastic happens. And the volume for such a big, down day has to be at least more than 2.5 billion shares in order to have notable effect I guess.
STI is getting nearer to its recent high of 1,960 already. Seems like it is quite likely that the STI will create a new high this time. Traders can try to play some short-term trades till 1,960. Maybe STI will really reach 2,140 within the next few weeks. By then, I believe a correction should kick in. But the million-dollar question then will be, "how low can prices go again so that we can all buy more at a bargain?"
I seriously don't know, else I do not need to glue my eyes to the trading terminal all the time already. I guess regardless of whether we are short-term or long-term in our investment horizon, the most important thing is that we can make profits whenever we close off our positions.
At current pricing, the blue chips are still cheap if we look at a 3-5 year horizon. I will leave it to individuals' discretion to decide if they want to buy. I think from now on, basically, I will continue to list out the counters worth monitoring/investing, and highlight whatever counters at the bottom their relevant stories and suggest they are more suited for contrarian or trend trading. Meanwhile, depending on the market situation, I will send out ad-hoc updates should there be any trading opportunities too.
F&N:
This counter is starting to move today after being such a laggard compared to the broad market rally. The sluggish behavior is due to the unsolved issue with Frasers Commercial Trust, a company that F&N has exposure to. I think it is only a matter of time for it to move up too. You may like to accumulate some.
Note: Kindly read my first post, About Myself, on my disclaimer. Thank you.
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