7 - 13 Jan 2013
Uncertainties cleared Market Skyrockets
Market Update ◆
Indexes is in consolidation
This article is intended for students interested in the stock market. With 10 years of trading experience, our writer is an investor. He is currently managing 800k of equity.
Abstract of past issue
Hang Seng Index attempts to achieve a new high
Our market timing model for both HSI and HSCEI shows an ‘Uptrend’ signal. Downside risk is extremely low. Risk-to-award ratio is favorable to investors. Investors should put their money into the leading industry group such as shipping and solar energy. 6-1-2012
Then….. Shipping and solar energy groups led the market this week. Three major solar energy related companies, GCL -Poly (03800), Singyes (00750) and Comtec (00712) , rose over 20% in a week. The state-owned shipping giants, CSCL (02866) and China COSCO (01919), broke out from their bases and surged over 10%. The members in these industries outperformed the market for over 5%.
here was not any break-
ing news this week. Indexes looked calm but individual stocks looked volatile. Lead-
HSCEI acts exactly the same with Hang Seng Index
ing sectors switched to solar energy, wind power and shipping. The up/down ratio fluctuated, showing that many individuals have started their consolidation. Up to down ratio dropped to 30% on Tuesday and Friday.
It showed that there was some selling pressure. One should also notice that many of the local property companies have broken their 52week new high, indicating the continuation of uptrend for the real estate market.
13 JAN 2013
What now? “Our market timing model for both HSI and HSCEI still shows an ‘Uptrend’ signal. Downside risk is not high and the continuation of the current trend is 80%. Risk-to-award ratio is still favorable to investors since the density of ‘sell-off’ day is low. Investors should keep searching for leading industry groups and build a position on the strongest member. Remember to set a cut-loss price.” Joseph Lau
China COSCO (01919) breaks the ‘cup with hande’
THE WINNING INDUSTRY Owing to the expectation of the recovery of shipping market, the whole sector has surged and outperformed the market. China COSCO (01919), the largest state-owned shipping company, has broken out from the ’cup with hands’ base and risen over 20% in two weeks. The uptrend was supported by the increasing trading volume. Anyone who bought this stock should hold it at least until the end of February such that the expected return of this stock is maximized.
CSCL (02866) breaks out from the base and rises
CSCL (02866) also has broken out simultaneously with COSCO. Such signal increases the probability of success. The probability that the uptrend continues is over 70%. Other fast-growing members include CIMC (02036) and China Shipping Development (01138). Borizon Ranking COSCO