Hang Seng Update

The Hang Seng Index broke out of its 200 day moving average on 23 Apr 08. The index is currently in "Accumulation" phase.






The chart is showing more strength for Hong Kong then Shanghai. The Shanghai Composite Index is still in "Bearish" mode. If you are keen to invest in the China story, it may be better to park your cash in Hong Kong. In terms of valuation, H-shares listed in Hong Kong are more attractive than the A-shares listed in China.


Currently the 300 member CSI 300 is still valued at 22 times earnings estimates for this year whereas Hang Seng China Enterprise Index is trading at 16 times earnings estimates.

STI Update

STI closed at 3189 on Friday. For the week, the index is up by 64 points. The index is lying between its 50 day and 200 day moving average of 3025 and 3348 respectively.



The index has stayed in “Recovery” mode for 24 trading days now. Looking back at the historical data, the index stayed in “Recovery” phase for 22 trading days from 29 Apr 03 to 30 May 03 before moving to “Accumulation” and “Bullish” mode.

Let’s see if the index has the power to clear the 200 day moving average.

Shanghai Market Update

The Shanghai Composite Index drop 398 points to end the week at 3094. That is a 12% drop in 1 week.




The phase chart is showing weakness since 10 Mar 08 when the index dipped into “Bearish” phase. It has stayed in “Bearish” mode for 29 trading days. For this round of bear attack the index has dropped from 4300 to 3094, a whopping 1206 points or 28%. The bulls must be feeling the heat right now.

The last time the index fell into “Bearish” phase was in 27 Sep 05. The market stayed in “Bearish” phase till 9 Dec 05, a total of 47 trading days.

The chart doesn’t look good for Shanghai. Hope it can find some support at 3000.

Hang Seng Update

Hong Kong Hang Seng Index closed at 24258.96. An up move of 380 points.

The phase chart is showing that the index is still in "Recovery" mode. It has stayed in this mode for 12 trading days now. The index stayed in "Bear" mode from 6 Mar 08 to 1 Apr 08, a total of 18 trading days. That was relatively short compared to Singapore STI, Japan Nikkei 225, Dow etc. Hong Kong has always been tied to the China growth story which may explain why it is able to bounce up from the "Bear" phase so quickly.

For now the index is trapped between the 50 day and 200 day moving average. Should be able to start buying if it can clear the 200 day moving average.

STI Update

STI closed at 3042.96 on Monday, down 83.91 points. That is a drop of more than 2%.

Looking at the phase chart and moving average chart,



The STI is still at "Recovery" phase. It has stayed in "Recovery" phase for 15 trading days. This is the best performance for the index so far in 2008.

The next support for STI is 2995.45. If the index can hold above its 50 day moving average of 2995.45, then the "Recovery" is still intact.

Taiwan Market Update

Taiwan stock market has been on a good run recently due to presidential election results. The market reacted positively after the election result and the index is now above it's 200 day moving average.







The market has been moving between "Accumulation" and "Recovery" phase. A good sign for those that are invested in Taiwan market.

Hang Seng Updates

Hang Seng Index has recovered from its low of 20,572 and is now at 24,311. About 4000 points move in 3 weeks.

It is now above its 50 day moving average and is in "Recovery" phase since 2 Apr 08. It stayed in "Bearish" phase for about 1 month and if it can take out the 200 day moving average then we will be in "Accumulation" phase.

US is showing some strength recently even with bad news being announced. Hope this show of strength will spread to Hong Kong and the rest of Asia.

India BSE Index

The India BSE Index moved to "Bearish" phase on 31 Mar 08. The last time the index moved into "Bearish" phase was in Jun 04. It stayed in "Bearish" phase from 21 Jun 04 till 15 July 04, a "Bear" period for around a month.







Let's see if the market snaps back as fast as the last down turn. Based on current technical picture, it is still too early to invest in the India market.

US Financial Sector Update

US Financial Sector seems to be gaining strength again.

The iShares Dow Jones US Financial Sector fund is now in "Recovery" phase.
This is the first time the fund is testing the "Recovery" phase twice within
a span of 10 trading days since the beginning of 2008.

The fund is now trading slightly above the 50 day moving average of 86.24.
It has stayed in "Recovery" mode for 3 days now. Let's see if it is able to
move up to challenge the 200 day moving average of 99.95.

EURUSD Phase Analysis

Date	Close	Phase	50 DMA	200 DMA
1/2/2008	1.471500039	3	1.462633967	1.398215771
1/3/2008	1.474300027	3	1.463170052	1.398816347
1/4/2008	1.475200057	3	1.463551998	1.399397254
1/6/2008	1.474799991	3	1.463805795	1.400010705
1/7/2008	1.468199968	3	1.463815928	1.400604248
1/8/2008	1.470700026	3	1.46389389	1.401202559
1/9/2008	1.466199994	3	1.463897824	1.401773691
1/10/2008	1.479900002	3	1.46445179	1.402442217
1/11/2008	1.477699995	3	1.464767933	1.403106213
1/13/2008	1.480499983	3	1.465078115	1.403781295
1/14/2008	1.486700058	3	1.465574026	1.404503345
1/15/2008	1.480200052	3	1.465881944	1.405181289
1/16/2008	1.466099977	3	1.465863824	1.405788779
1/17/2008	1.463799953	-1	1.465807915	1.406381726
1/18/2008	1.461599946	-1	1.465377927	1.406963706
1/20/2008	1.459400058	-1	1.464853764	1.407544613
1/21/2008	1.441799998	-1	1.463985801	1.408026576
1/22/2008	1.464300036	3	1.463599801	1.408625603
1/23/2008	1.462700009	-1	1.46318388	1.409217477
1/24/2008	1.477100015	3	1.46298182	1.409857512
1/25/2008	1.467100024	3	1.462653995	1.410434365
1/27/2008	1.468999982	3	1.462355971	1.411030889
1/28/2008	1.478600025	3	1.462413907	1.411711097
1/29/2008	1.476699948	3	1.462690115	1.412411213
1/30/2008	1.482800007	3	1.463021994	1.413146615
1/31/2008	1.486400008	3	1.463412046	1.413904071
2/1/2008	1.479799986	3	1.463484168	1.414652705
2/3/2008	1.480200052	3	1.463898182	1.415399432
2/4/2008	1.482599974	3	1.464238167	1.416157961
2/5/2008	1.463500023	-1	1.464200139	1.416786075
2/6/2008	1.461300015	-1	1.464123964	1.417400002
2/7/2008	1.447600007	-1	1.46366024	1.417930007
2/8/2008	1.451200008	-1	1.463361979	1.418473005
2/10/2008	1.452399969	-1	1.462988138	1.419035912
2/11/2008	1.450000048	-1	1.462736011	1.419591546
2/12/2008	1.457999945	-1	1.463050246	1.420149565
2/13/2008	1.45539999	-1	1.46332407	1.420695543
2/14/2008	1.46420002	3	1.463784218	1.421284914
2/15/2008	1.467800021	3	1.464303851	1.421898603
2/17/2008	1.467200041	3	1.464884043	1.422507167
2/18/2008	1.4648	-1	1.465517879	1.423112154
2/19/2008	1.472800016	3	1.466259718	1.423709512
2/20/2008	1.472100019	3	1.466949821	1.424303174
2/21/2008	1.481299996	3	1.467787743	1.424900174
2/22/2008	1.483100057	3	1.468659878	1.425512075
2/24/2008	1.483100057	3	1.469349623	1.426115155
2/25/2008	1.483299971	3	1.469795585	1.426735282
2/26/2008	1.499600053	3	1.470357656	1.427421212
2/27/2008	1.511600018	3	1.471121788	1.428166866
2/28/2008	1.519099951	3	1.472305894	1.428951859
2/29/2008	1.518000007	3	1.473235965	1.429670453
3/2/2008	1.519999981	3	1.474150062	1.43039763
3/3/2008	1.51970005	3	1.475040078	1.431104779
3/4/2008	1.520699978	3	1.475958109	1.431815624
3/5/2008	1.527699947	3	1.477147937	1.432566643
3/6/2008	1.538300037	3	1.478500009	1.433370709
3/7/2008	1.534500003	3	1.479866147	1.434145689
3/9/2008	1.539399981	3	1.481056094	1.434940219
3/10/2008	1.533599973	3	1.482174039	1.435709238
3/11/2008	1.533800006	3	1.483240008	1.436465621
3/12/2008	1.55400002	3	1.484586239	1.437316537
3/13/2008	1.562000036	3	1.486222267	1.438226342
3/14/2008	1.566900015	3	1.488238096	1.439150095
3/16/2008	1.575999975	3	1.490482211	1.440169573
3/17/2008	1.574300051	3	1.49273622	1.441166043
3/18/2008	1.565400004	3	1.494856238	1.442175627
3/19/2008	1.563599944	3	1.49729228	1.443174481
3/20/2008	1.543499947	3	1.498876333	1.444031477
3/21/2008	1.54369998	3	1.50049603	1.444913507
3/24/2008	1.543200016	3	1.501818061	1.445797563
3/25/2008	1.56099999	3	1.503696084	1.446750283
3/26/2008	1.582000017	3	1.505956173	1.44776988
3/27/2008	1.58099997	3	1.508004189	1.44876492
3/28/2008	1.58039999	3	1.510078073	1.449761391
3/30/2008	1.577000022	3	1.511962175	1.450769186
3/31/2008	1.575700045	3	1.513748169	1.451747894
4/1/2008	1.566599965	3	1.515484214	1.452747345

The phase analysis method can also be applied to currency. Lets look at EURUSD currency pair.

If you look at the phase table, you can see that the EURUSD currency is now in "Bullish" phase. In fact this currency pair has been in bullish mode since Apr 06.