• Yesterday’s breakout from its 30-day SMA at S$0.11 is a positive sign. However, to reverse its medium term downtrend channel, it still needs to penetrate above S$0.14 before we would turn bullish.
• Although MACD is still rising, RSI is fast approaching the overbought territory. This bull-bear tussle may cap gains to the upside as momentum may stay weak after end-08 plunge.
• A minor correction may take place soon to neutralise the RSI indicator. Therefore, investors should accumulate only during technical pullbacks, possibly near its 30-day SMA. Cut loss if prices fall below S$0.105.
Sarin Technologies Ltd. develops, manufactures, and sells planning, evaluation, and measurement systems for diamond grading and gemstone production. The Company's products include diamond cut grading tools, rough diamond optimization systems, gemology tools, diamond color grading, and laser marking machines.
Singapore Telecommunications (ST SP; S$2.51) – BUY
• The stock has broken out of its medium term downtrend channel. It is currently struggling to hold above the trend line support. If prices fall below the 30-day SMA at S$2.48, it would suggest that the run-up is just a fake out.
• Technical indicators remain conducive. MACD is still rising towards the positive territory while RSI is neutral at 52.
• If prices were to hold above its 30-day SMA, we would expect a turnaround in sentiment, with resistance seen at S$2.63 and S$2.79. Buy on weakness. Cut loss however if prices fall below S$2.40, as next support is weaker at S$2.18 and S$2.00.
Singapore Telecommunications Limited operates and provides telecommunications system and services. The Company provides postal services, directory advertising and publishing. Singapore Telecommunications sells and maintains telecommunications equipment and provides mobile phone and paging service, computer network, and Internet and information technology services.
Ezra Holdings (EZRA SP; S$0.685) – BUY
• The stock has broken out of its 30-day SMA. The 2-week rally is likely to be extended towards the next resistance at S$0.745 and S$0.85. It needs to fill the S$0.99 gap to confirm a change in tone towards the bulls.
• Although MACD is positive, RSI is almost overbought at 69. This suggests that a temporary pullback may take place soon. However, we do not expect the correction to drag it below the 30-day SMA at S$0.56.
• Any pullback towards the 30-day SMA is a good buying opportunity. Cut loss if it tanks below S$0.54, which may signify the end of its short term rally.
Ezra Holdings Limited is an integrated offshore support and marine services company. The Company owns offshore support vessels and provides chartering and management services. Ezra also provides offshore support, marine supplies and engineering services.
Santak Holdings (SNTK SP; S$0.105) – SELL
• The stock is still trapped in a downtrend rally. With technical indicators showing more signs of weakness, a re-test of S$0.095 and S$0.08 supports is only a matter of time.
• MACD is poised to stage a negative crossover while RSI also hooks down, suggesting that prices may play catch-up on the downside.
• Investors should do well selling into strength. The bears are still in command with resistance seen at S$0.12 and S$0.135.
Santak Holdings Limited manufactures custom-made precision-machined components for hard disk drives, fiber-optic connectors and communication products. The Company also manufactures coils used as antennas for contactless smartcards, tags and transponders. Santak also trades custom-made electronic components such as heat sinks, printed circuit boards, connectors, LCD modules and solenoids.
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