Risk Reduction Action

A quick summary of things, this morning Hang Seng Index has touched 23,000 points. Such a whole number is usually a strong resistance level and true enough the index ended slightly lower at 22,880 points today.


Dow Jones Industrial has also almost touched the 11,000 strong resistance mark. As written in my previous post on indices I think the market might be due for some retracement. Of course there is a chance that I may be wrong and the market will rally to a new level but I would like to keep some profit and minimize the risk now.


I've sold off half my holdings of MGM Resorts @ US$11.86 today. Not going to hold till my true target price. If the market does tank in the next few days, we'll have opportunity to buy back what we sold today.


Remember, keep your profits! Don't let the market take it back from you!


Sell half portfolio of MGM Resorts International @ US$11.86.

Market Update and MGM

We're at the point of time now which I feel the market has probably gone up a little too much and is due for a slight retracement. Let's take a close look at both the Dow Jones Industrial and Hang Seng Index to have a better feel of things to come.

Dow Jones Industrial Index

The US market has completed a spectacular September month, rallying from approximately 10,000 points to the current level of 10,800. In this month it also forms 3 higher highs. Although it has rallied quite a fair bit, I believe there might be still a little bit more of upside possibility. Strong resistance should come at approximately near the 11,000 mark.

Hang Seng Index

Switching over to the Hang Seng Index (which is usually the key measurement for Asian markets for me), it has already reach a resistance level at 22,400. Even if it goes up, the next strong resistance level will be at approx 22,550 level and I don't really feel it makes much sense to gamble on such a small gain.

Looking at both US and asian market, it seems a good time now to sit back, relax and wait for a retracement before entering the market again. Most of the good counters seems to be overly bought and doesn't offer any value now. At the moment of me typing this post, the general asian market has tanked today and Moody's looking at the possibility of downgrading Spain's rating. Doesn't look very bright for Europe side either.

MGM Resorts International

Wow wow this counter flew yesterday, moving up a whooping 5.44%. At one point during the day, it was up more than 7%. This comes amidst news that MGM Resorts is seeking to list her Macau casinos. Read more about it from MarketWatch here. Although this is not really new news, I'm happy that it still has enough effect on this counter.

Recap and Pointers for the upcoming week(s)

It's been a while since anything worth blogging is happening in the market. I've some points to note down for recap and a brief outlook on next week.


Some time around the 3rd week of August, there were some little concerns about the market doing a double dip. I actually wrote a point about the US market probably not going to drop by too much. You may read about the analysis here. The US market is actually up for a consecutive week now so all is good.


I've still had an open position for Ezra which we've bought recently. Do take note there is a 1 for 5 rights issue for this counter. Please exercise the right to buy the additional shares at $1.18. That should bring our average price for Ezra to about $1.71.


China property prices has gone crazy yet again despite the government tightening. You should be able to find plenty of reports confirming the sudden rise in prices in September again. Probably due to the pent up frustration during the "seventh" month... who knows? Here's one such article. I foresee the Chinese government coming in with further tightening actions soon if the trend continues. As such, I'm not going to touch property counters for the time being. In fact, I just advised a friend to sell of his Yanlord shares. There should be very limited upside and we're better off investing in other more exciting stuff.


So what are the exciting stuff? Gaming counters of course!


Las Vegas Sands, Genting International and SJM Holdings have all rocketed quite a fair bit recently. Results have been nothing short of spectacular. Ok maybe not so spectacular for LVS but seeing the result of RWS, I think there's alot of potential for LVS to be in the black this coming quarter. I'm also monitoring some other retail counters as well as a little bit of a sinful stocks. Will post it up when the opportunity arises.


Coming next week.....

Hang Seng is currently trading near resistance level. 21,805 points was the recent high and the market is near this level.

Straits Times index also seems like there's going to be limited upside, probably facing strong resistance near the 3,100 level.

Looks like if you guys have any counters that is in-the-money now can consider taking some profits. I believe the market is due for a small dip soon and that's when we'll look to enter again.

D-Day for the Market

What a day. The global market tanked today to the trendlines support levels which I mentioned in the previous post on major indices. Tomorrow will seem like a crucial day. Should the trendlines fail to hold, we'll need to cut losses of the previous positions we took and prepare for the worse.


A quick recap:


Hang Seng Index
Closed at 20,659. I actually wrote support level at about 20,750 so might still be ok.


Shanghai Stock Exchange
Closed at 2,777. This is hitting the short-term resistance level and I foresee it turning down.


S&P 500
Closed at 1,052. Support level 1,055.


Dow Jones Industrial
Closed at 10,040. Support level around 10,000.

Signs of Uncertainties Ahead

The recent spate of stellar earning reports, coupled with the faltering US economy (worsening job situation), has resulted in investors having a very mix idea of the market direction. Fears of a double-dip recession seems to be at a high and may have a negative effect of the upcoming week.

I'm looking at some of the major indices for some preparation for next week:

Dow Jones Industrial

Looking at the chart, we seem to be at the crossroads now. Our current level is just touching the border of a middle support level. Should the negatives continue, I would be looking at Dow reaching a level of approximately 10,000. Upside though is approximately 10,700. The next couple of days will be crucial.

S&P 500

The S&P looks to be very near the main support line. I am expecting to see strong support coming in at the 1055 level. But should this support be broken, the market is going to look very bleak. Again, we should know the answer by the first half of the week.

As a summary, should the support levels hold, I'm not expecting a huge drop in the US market. Probably at most 1 day of big plunge before the market start picking up again. HOWEVER, do take note of the mentioned support levels, once broken, we could be in for a bad ride.

Hang Seng

Let's start with the Hang Seng index for the Asian markets. The Hang Seng seems to be trading within the recent channel. Upside resistance level should be about 21,650 and downside support should be somewhere 20,750. However, should 20,750 support be broken, again it looks like there could be a significant plunge. Limited upside potential.

Shanghai Stock Exchange

Oh how I hated the past few months of China market. China seems to have lost her steam, and in addition to all the tightening from the Government, the market seems to have come to a standstill. Good news is, I think the Chinese Government has succeed in taming the market and I don't foresee any further tightening policies coming up. Bad news is, the Shanghai Stock Exchange is trading just below the middle resistance level. We'll need some strong momentum to broke this level. If not, I see the market turning south to a level of about 2,580.

Overall, I think majority of the world market seems to be trading at either resistance or support level. It's very hard to see a clearer direction it's heading. As such, I would recommend conservative investors to sit out this period and wait for the fog to clear. For the more ambitious traders, the next few days will be crucial. I foresee either some good bargains coming up, or some cut losses to be made.

Good luck.