I was chatting with one of my student as she was in OCBC and wanted to know if it's time to get out or continue to hold the stock for longer term. I studied the chart carefully since I wanted to find out where is the high while STI rallied a little today. It was a weak rally and hence I knew the stock wouldn't sustain too long where I replied her message that OCBC's high would be $11.28 for today @ 10.03am. Since that time, she sold off her shares and OCBC started selling down to a low of 11.20!! From 11.28 to 11.20, it was a 8 cents drop in 1 hour plus where I saved her position. She was very delighted to take my advice and managed to get out confidently.
The question was how did I know? In the stock market especially Singapore, there are good rallies and weak rallies. Weak rallies are usually accompanied by sellers along the way while good rallies are usually followed by wave of big buyers. In this case, STI was a weak up move and OCBC is a blue chip inside the STI component and hence at 10.03am when I witnessed some obvious hidden selling, I told to get out first. The rest was history but a good lesson was learnt. Looking forward to the next trade.
Ronald K - Market Psychologist - A Stock Market Opportunist
