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18 June 2006

 
Market Technical Rebound Started

Note that even if in a downtrend or bear market, there are bouts of rebounds, shorter term averages tend to converge with longer term averages if the former is too distant from the later one resulting in oversold situations that prompt the short sellers to cover back shorted positions due to temptations of fat profits from shorting, which is the case in the current market, an oversold one.

I noticed that about 81 stocks on my radar screen had formed small double bottoms and had broken above their respective db necklines. Some of these breakouts were backed by heavy volumes, especially for some China plays.

What does this mean? The market is mature for a relief rally or a sucker rally as mentioned in the market comment in this blog a few days ago.

China plays may lead this rebound until shorter term averages converge with the longer term averages, resistance of this rally. Most stocks may have abilities to rebound about 50% of total fall from high.

Bear in mind that maybe this is merely a relief rally in the bear market, which may resume dropping after this bear rally. Remember to take this excellent opportunity to exit all long positions since the bear has been in this market for a while already and may continue to stay for a prolonged period.

To participate in this rebound, we may focus on following counters, buy or add positions near necklines of DBs, sell after rebounding of about 50% of total fall (This principle applies to existing positions, too.). It is not necessary to stick to the same counters in hand if you want to average down, buy the strongest ones instead since they are the most possible ones to outperform the general market and those laggards in large margins.

China Essence db .455 -.505
China Milk db .83-.92
Fabchem db.38-.41
Luzhou db .49-.59
FerroChina db .55-.61
Mediaring
China Dairy db .465-.51
China Paper tb nl .325
China Precision db .265-.32
MidasChinaPetro db .43-.50
EzyhealthXPress db .125-.14
LongcheerPac Andes db .635-.70
Link Hi db .15-?
HengXin db .32-.37
JiuTian db .395-.465
SkyChina db .295-.325

# posted by TopTrader @ Sunday, June 18, 2006
Comments:
agree with you. I see island reversal just like when it first started at the top. There may be a little retracement to cover the gap, but in general I am Bullish for now.
# posted by Blogger denzuko1 : Monday, June 19, 2006 at 9:30:00 AM GMT+8
 
If the breakaway gap is not covered at all, market will be very strong.

If only less than 50% of the gap is covered before up again, it is still strong enough.

If all gap is covered, the market is weak.
# posted by Blogger TopTrader : Monday, June 19, 2006 at 2:12:00 PM GMT+8
 
China Essence db .455 -.505 bot .53
China Milk db .83-.92
Fabchem db.38-.41
Luzhou db .49-.59
FerroChina db .55-.61
Mediaring db .275-.31 bot .325
China Dairy db .465-.51 bot
China Paper tb nl .325 bot .33
China Precision db .265-.32 bot .33
Midas db .59-.64 bot .65
ChinaPetro db .43-.50
Ezyhealth bot .17
XPress db .125-.14
Longcheer
Pac Andes db .635-.70
Link Hi db .15-.165
HengXin db .32-.37
JiuTian db .395-.465
SkyChina db .295-.325
# posted by Blogger TopTrader : Monday, June 19, 2006 at 10:55:00 PM GMT+8
 
Update

China Essence db .455 -.505 bot .53
China Milk db .83-.92
Fabchem db.38-.41
Luzhou db .49-.59
FerroChina db .55-.61 bot .61
Mediaring db .275-.31 bot .325
China Dairy db .465-.51 bot
China Paper tb nl .325 bot .33
China Precision db .265-.32 bot .33
Midas db .59-.64 bot .65 added .63
ChinaPetro db .43-.50
Ezyhealth bot .17
XPress db .125-.14
Longcheer db .665-.77 bot .78
Pac Andes db .635-.70
Link Hi db .15-.165
HengXin db .32-.37
JiuTian db .395-.465
SkyChina db .295-.325
# posted by Blogger TopTrader : Wednesday, June 21, 2006 at 12:32:00 PM GMT+8
 
Update 21 Jun 06

China Essence db .455 -.505 bot .53
China Milk db .83-.92
Fabchem db.38-.41
Luzhou db .49-.59
FerroChina db .55-.61 bot .61
Mediaring db .275-.31 bot .325
China Dairy db .465-.51 bot 0.545
China Paper tb nl .325 bot .33 added .335
China Precision db .265-.32 bot .33
Midas db .59-.64 bot .65 added .63
ChinaPetro db .43-.50
Ezyhealth bot .17
XPress db .125-.14
Longcheer db .665-.77 bot .78
Pac Andes db .635-.70 bot .705
Link Hi db .15-.165
HengXin db .32-.37
JiuTian db .395-.465
SkyChina db .295-.325
# posted by Blogger TopTrader : Wednesday, June 21, 2006 at 11:45:00 PM GMT+8
 
Update 22 Jun 06

China Essence db .455 -.505 bot .53
China Milk db .83-.92
Fabchem db.38-.41
Luzhou db .49-.59
FerroChina db .55-.61 bot .61
Mediaring db .275-.31 bot .325
China Dairy db .465-.51 bot 0.545
China Paper tb nl .325 bot .33 added .335
China Precision db .265-.32 bot .33
Midas db .59-.64 bot .65 added .63
ChinaPetro db .43-.50
Ezyhealth bot .17
XPress db .125-.14
Longcheer db .665-.77 bot .78
Pac Andes db .635-.70 bot .705
Link Hi db .15-.165
HengXin db .32-.37
JiuTian db .395-.465
SkyChina db .295-.325
SembCorp db 2.75-2.95 bot 2.96 tg 3.15 (minimum tg for db) to 3.195(upward retracement to 50% level of correction amplitude from 3.64 to 2.75)
# posted by Blogger TopTrader : Thursday, June 22, 2006 at 10:55:00 AM GMT+8
 
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