The SET Index Discussion

Hey, I just wanted to start up a topic that discusses the movements of the SET Index, that mainly uses Technical Analysis, but any analysis is fine, really.
Hope it'll make this forum more lively. Please give your opinions and analyses.
Props to the creator for a great site that gives you historical data longer than 1 year.


7/6/2011
SET Index closed at 1034.75 (-11.41)
SET broke its previous low of 1048.63 (06/05/2011) on 6/6/2011. Today, it tested 1048, but couldn't get past. Eventually, SET went below the 1040 "natural" support causing rapid selloff in the late afternoon.

I have noticed that the SET Index has been forming a head-and-shoulder pattern for a while now, with the left shoulder on 8/4/2011, head on 21/4/2011, and right shoulder on 11/5/2011 (see daily SET chart). It broke the neckline on 23/5/2011, but still hovered around the 50-day moving average before breaking down (this is like William O'Neil's theory).

However, at the same time, I notice that the index is also forming a descending triangle, in which is broke downward yesterday 6/6/2011.

Now, with the head and shoulder pattern, I would give the target price at 1020 (using semi-log scale price projection).
But with the descending triangle, I could see the index falling to 980.

I'm leaning towards the 1020 mark, but with the political situation, I could see it getting worse.

So my question to everyone is whether or not you think it's a H&S or a descending Triangle? Or something else.

8/6/2011
9:00 am

Not looking good so far today. DJIA made a sudden fall after Bernanke didn't mention specifically that there will be a QE3. Crude oil is expected to drop lower by expected increase in daily production by OPEC. Crude oil went up today on news that US supply less than forecast. But this seems temporary to me. OPEC rise in daily production will likely make a longer lasting effect on price. The level of impact all depends on how much the daily quota will be increased.

Nearly all Asian indices opened down today, including Nikkei and Hang Seng. Yen strengthens against the dollar and euro.

Volcano in Chile affecting air travels.

Good luck today, but looks like another SET down move towards 1020 (I think). :p

Whew! Officially broke the 1020 area! It's all out hell now. See you at 1000.

Lunch Time Report

Well well, rough morning eh? So SET went below my predicted support of 1020, with heavy selling all around, especially Banks and Energy stocks, but the index is still hovering around 1016-1020 area. The bearish momentum seems to be slowing down a bit in the late morning session, as the daily RSI is likely to have entered the oversold area, causing such a fast sell off in the early morning. Well, not much to say now. It's a wait and see game now. Will the 1016-1020 area act like a stack of fluffy pillows and lead to a slight rebound; or will SET take a second round of beating in the afternoon session? Or should we just stop watching the ticker because even if it keeps going down, it's too late for us to have the courage to cut that loss...hehe.

8/6/2011 11:15PM

As I thought it was gonna keep going down tomorrow, some good news arrived. Turns out oil production quota will not be raised as OPEC countries voted against the increase, sending crude oil back up above $100. So we should see some recovery in the energy sector tomorrow. Whoever bought SUSCO at the low today might be happy tomorrow.

As of right now, Dow Jones is slightly positive, but it could easily fall down into the negative zone in a couple of hours since Europe didn't do so well today either.

So if I had to decide, I would say that SET will likely move sideways and eventually into the negative zone by the end of the day tomorrow, but I don't think it would be as crazy as today. It is very possible that SET will test the 1018-1020 resistance zone, but I have doubts that it will go above it. Then, after failing to pass the resistance, it'll come down to about 1010-1012. This is just my gut feeling though. It's survival mode now. Good luck strangers.

Lunchtime Report
SET 1003.00 (-11.58)

Well well, looks like I've overestimated the good news and underestimated the bears.
The morning session low was 998.39, which I still consider to be in the 1000 support zone, but it's looking tough.
The small investors better make the right move because it's a killing out there.
Foreigners are selling. Institutions are scaring the hell out of the small investors to sell and then buying it right back at the low.

If it does break below 1000 today, then I think we'll see it go as far as 990 this afternoon. My target now would be 980 for the next few days, since the 1020 obviously didn't hold. If it goes below 980, then I would suggest turning off your computer and phone and cry beacause the next stop would be around 940. (The previous low on February 11th, 2011, was 937.06)

In addition, SET has officially crossed below the 200-day SMA (1005), but still above the 200-day EMA (990). It's never a good sign when you cross below the 200-day MA, whatever type of MA it is. But let's see what happens. They're out to force you to make a mistake!

Lunchtime Report
SET 1018.94 (+2.09)

After a week of misery, US stocks rose on trade surplus data, sending the rest of the world up. Yesterday, SET closed at 1016.85, a turnaround after dipping under the 200-day SMA. SET closed at the high and with the long bottom tail, small body candlestick. Hinting at a reversal where the bears go back to their caves and the bulls come out and play for a while. But one cannot be so sure. I'm still not that optimistic. Foreigners are still selling, and still have a lot more to sell. The net value of foreign buying/selling since June 1, 2010 to now is still +72,820 million baht; and from January 2010 to now is +52,516 m. This year, Foreign buying/selling is at -6066 m. So a lot of foreign money is still in the market and if they wanted to sell 10% more to offset the political risk, then it would mean a large drop in the SET Index.

Today, the index opened up sharply, but stopped and dropped at 1025.56, reflecting investors' anxiety and the "เล่นเร็ว" mentality that has plagued the market for most of this year. Also, it turns out that the daily RSI never reached the oversold area two days ago (8/6/2011), but it pretty much "bounced" off that oversold area.

Leading the market today are the Food (TF), Packaging, and Personal Products & Pharmaceuticals (DSGT) sectors. Lagging the market is the ConMat sector (SCC & SCCC), but good for DCON.

Overall, I'm still bearish about the market. I think this is only a temporary pause in the market correction. It's a wait and see game. Let's see how long this "rebound" will last. 1048-1055 would be the important resistance zone.

10/6/2011 10PM
SET 1020.37 (+3.52)

Let me just start off by saying that the afternoon session was truly epic. Whoever was watching the ticker would know. For those of you who missed it, let me tell you what happened. SET had made its daily high (1025.56) very early in the morning, only about 10-20 minutes after the open. Then it went down for a while. When the afternoon session opened, it was a little quiet...for about 2 minutes. Then, the bulls started buying, pushing the index up from about 1018 to about 1020. Then, there was a breather around the 1020-1021 area, and then the bulls were back pushing the index up to 1022, 1023, 1024!

By now, the bears were in also full steam. It was crazy! None of this little investor type deal, it was almost all block trading, large amounts of shares. Simply put, it was a freakin' battle! Institutions (bulls) vs Foreigners (bears). It's like two gladiators battling to the death to be the Champ. Like Maximus and the current Champ fighting, with Local Investors and Proprietary as the tigers on the side of the arena, trying to get a piece of the action. And they used every arsenal they had. Around 15:45 to 16:15 was probably the most intense. The index itself didn't move much, but that's because you got two large bodies of mass going head to head; there's a lot of force, but it ain't moving. And I'm not even exaggerating. I was watching to see if it would break the daily high, and it got...oh so close. The bulls were hanging on as the index fluctuated between 1024-1025, then it became 1023-1024, and I knew it was over. Eventually, the bears got the final blow and the index dropped down, closing at 1020.37.

I think that the real game changers, though, were the Local Investors and Proprietary. If they had sided with the Institutions, then I think it would have gone above the daily high, and then it would have ran up at least 5 points more. But the fact of the matter is that people are scared. The local investors are watching on the sideline to see how it's gonna turn out. But unlike most days where the battle is usually short, or there's not much of a battle at all, today, it stretched for the entire afternoon session. In the end, fear won. People are thinking that if they don't sell now, then they might miss the chance. Better "safe" than sorry. Like in the movie when Maximus eventually goes to the side too much and the tiger jumps on him, knocking him down to the ground. But who knows...the Champ thought he won, but Maximus stabbed the tiger and got back up. So maybe there'll be another battle next week and Maximus will win out. Or maybe, in reality, the tiger would have bitten Maximus' head off. We shall see!

10/6/2011 11:20 PM

Ok, so I just read the news and saw the US & European Indices. European Indices down by 1% to 2%. Dow Jones currently down by about 1.2%. Looks like the "rebound" is over. All this because Saudi Arabia is flexing its muscles and is intent on increasing oil production even though the OPEC summit didn't reach an agreement. Crude oil dropped below $100. However, Mark Mobius said that he's confident about SET even though there's political uncertainty. Seems like global politics is more like a contest to see who can be the most arrogant and get away with it. Every country is saying that they have some sort of leverage over the world and they're willing to use it. Globalization at its finest...

Lunchtime Report
SET 1007.71 (-12.66)

It's a lazy Monday morning. SET opened around 1013, gapping down about 7 points from Friday's close. It is likely that today's close will be in the negative zone, thus leading to an "evening star" candlestick pattern in the daily SET chart that signals a bearish reversal. We see Hang Seng and CSI 300 recovering a little bit after their lunch break, but they are still also in the negative zone.

Even though SET is down 12 points, it is trading at a pretty low value of 7,862.07 m bht. Seems like everyone is worn out from last week's fiasco. I wouldn't expect any panic sells as long as SET is above the other day's low of 998.

Leading today's loss are the Energy, Bank, and Property Development sectors. No gains in any sector right now.

13/6/2011 5PM

SET 1015.53 (-4.84)

The market picked up in the afternoon, following the Hang Seng. The index reached a daily high of 1017.26, pretty much closing the downward gap from the day before (10/6/2011 low was 1017.44). Technically, it didn't completely closed the gap, but it pretty much did. So it turns out that the pattern is not going to be an evening star after all. Looking at the 3 years daily historical data, I could only find two similar events. The first one was September 22nd, 23rd, 24th, 2009. A very similar pattern, but the move before it was a clear uptrend. The result was 2 days of decline afterwards. The next example is from January 26, 27, 28, 2011. This is also followed by a 2 day decline. Let's see how the US does tonight.

Ready for some color in your life?

Lunchtime Report
SET 1023.28 (+7.75)

SET rose this morning (against my predictions as usual) to test near the 1025 area, closing midday at the high. So we will see if it will pass 1025 this afternoon.

So COLOR hasn't been so colorful, opening up at 6.80, far above the IPO price of 2.89! I guess it would have been better off to go global.

14/6/2011 5:03PM

SET 1034.92 (+19.39)

So the afternoon session picked up quite dramatically. SET passed the 1025 resistance and just shot up from there, closing at the high. Of course, this is bullish and expect further increase tomorrow. Next resistance: 1048-1052.

COLOR disappointingly closed at the day's low at 6.40. I'm sure a lot of people are in pain, but that's what happens when you open up more than 200% above the IPO price and get too much attention. Talking about attention, the day's underdog, GLOBAL-W1, made a fantastic run up, closing at 1.88 or about an 80%+ increase! Holy Mother of God! Now that's what I call heaven. If you look at its actual fair value, it's -0.50 baht (7.5 bht conversion at a 1:1 rate). But who cares! If you are good with momentum and know when to cut loss, then you're fine. Tomorrow still looks very promising. I'm not trying to cheer it up or anything, but it really does look good (I don't wanna jinx it though). I made a good choice today to go with GLOBAL-W1 and left COLOR alone.

Banking, Petrochemicals, Energy, and Commerce led the increase today. Not surprisingly, since the market took a dump on these sectors, esp. Banking, last week.

Industrial Production (up 13.3%) numbers from China topped estimates by analysts, and its inflation (up 5.5%) numbers are as expected, so this was the real push in the global market today, since investors have been especially worried about global economic recovery after disappointing numbers from the US for the last couple of weeks. At the same time, China did also raise its reserve ratio by 0.5% to 21.5%, which is pretty high. European Stocks are looking pretty good right now. Hopefully, it stays this way for the rest of the day. The US should be good tonight too. China really came in and saved the day this time. If these numbers had shown a slowdown, it would have been hell.

SET Recap: Resistance 1048-1052, Support 1020-1025

Good luck tomorrow.

Lunchtime Report
SET 1035.99 (+1.07)

SET opened lower in the morning session and went down to as low as 1029.62 (-5.30) before rebounding around 11:30AM. Leading today's gain are the Property Development, Steel, and Transportation sectors.

The afternoon session looks promising, with SET closing midday at the daily high. Much like yesterday.

GLOBAL and GLOBAL-W1 declined in the morning session. This could be from taking profit, or maybe they are just playing some funny games. But if it gets below 1.74, then perhaps it would be a cut loss point because it's likely to drop to 1.6 or something like that.
Looking at the GLOBAL's daily chart, I expect the resistance to be 7.10 which was yesterday's high and also this is where the 50-day EMA is. So if it can get past the 7.10 area, then it's going to be very cheerful. In the intermediate term, it's moving sideways between 6 and 8 baht as it has been since Nov. 2010.

Asian indices vary, ranging from -0.5% to +0.5%.

15/6/2011

SET 1030.31 (-4.61)

Damn, talk about brutal! Global-w1 went straight up psycho apeshit today. It closed at 1.61 (-0.27, -13.83%). Maybe they're just trying to squeeze you out. Or maybe they really left...who knows.

SET opened sharply lower in the afternoon and stayed in the negative zone between 1029 and 1032 all afternoon. I'm not even gonna predict what's going to happen tomorrow. The market is very bi-polar right now. A strong day yesterday should have led to some increase today, but that's obviously not the case. When I find myself being wrong for a few days straight, then just do the opposite of what I say (not that I'm trying to tell you to do anything) haha.

Of course, Europe is still weighing everyone down with all their problems, with pretty much every market in Europe in the negative. It's the same problem they were worried about last June and nothing has been solved. Today, they're worried that the bailout is not going to happen. I guess that's what they've been doing all year. Talking it to death! Just do something.

So expect the US to go down tonight too. (this means that it'll probably go up, since I said that it's gonna go down)

16/6/2011 12:45 am

Dow Jones currently down 200 points (-1.66%) on concerns over Greece and also on the disappointing New York manufacturing data. Commodities plunge. It's not going to be good tomorrow. I'm expecting something like a 15 points decline in SET later today. But based on my track record in the past week in predicting SET movement, it might just go up 15 points instead. ;)

Let's hope that China stays healthy because it is the only thing preventing the world from a double dip right now, in my opinion. Some are saying the US is in a stagflation. Europe is a mess. Thai politics is a mess. Japan will eventually increase demand, but not right now.

Lunchtime Report
SET 1021.43 (-8.88)

Most major Asian indices drop by more than 1.5%. SET went as low as 1018.64 but rose back up above 1020. The afternoon session will depend on how Europe will do as they open. Right about now, I say, let it plunge. Let SET go back down to 940. I got my money ready. heh

16/6/2011 9:20pm
SET 1019.55 (-10.76)

Honestly, I'm surprised that SET actually managed to go down only 10 points, given how much all the other indices went down. Taiwan went down 2 percent. Europe is down as usual. The US is currently up slightly due to decrease in jobless claims and a rise in housing production. Tomorrow could go either way really.

Luckily we're not Laos because I saw the Laos index around lunch time and it was down like 3%. Damn! Their market is probably controlled by like three people. Invest at your own risk.

17/6/2011 1:20am

US markets fell after lunch into the negative zone after news of Basel likely to increase bank capital surcharge for large banks to 3.5%, due to fears of another financial collapse. Bank stocks are down. But it could just be that investors are taking profit. I mean, the US market have been declining almost everyday, so if there's a chance to get out, then they're going to take it. On the technical side, the Dow Jones (currently at around 11.9k) is heading towards a support level of 11.8k. And it seems like the Dow has a support area every 200 points or so, at 11.6k, 11.4k, 11.2k, 11k. But if it goes below 11k, then it's going to drop fast, technically and psychologically. Under 10k and we'd already be in another recession. Yawn.

Hang on to your cash.

Lunchtime Report
SET 1021.46 (+1.91)

SET opened slightly higher in the morning, gaining up to 1026.50 before coming back down to the current value. There has been a positive divergence between the intraday value and the intraday RSI, so hope it goes back up in the afternoon session. Not much to say today. Pretty low volume.

Other major Asian Indices are down from -0.2% to -0.8%. The Laos Composite Index currently up 3.13%! It's a real rollercoaster ride over there.

Alan Greenspan says that if Greece defaults, then the US will surely go into another recession. And I read that there's something like a 78% chance that Greece will default, so hmmmmmmm..... France and Germany will be screwed because they hold a lot of Greek bonds. I think we'll know by next month whether they're gonna default or not.

17/6/2011 9:30PM

SET 1018.96 (-0.59)

In the afternoon, volume picked up. But what really picked up was the value traded (37 billion), which was higher today than it was on Tuesday when the market went up almost 20 points. The most active value comes from ADVANC (+3.25, +3.32%), TOP (-1.75, -2.42%), and TRUE (+0.02, +0.50%). Looking at the Investor Types, this jump in value is not coming from Institutions, Foreign, or Proprietary. Instead, this is coming from Local Investors. So, some local investors buying a lot of ADVANC shares at this time. Hmmm.

BCP had four big lots totalling to 375,483,963 shares at 20.80 baht. Word must have gotten out in the end because BCP's share price jumped from 20.30 to 20.80 at the close. A 0.50 baht (almost 2.5%) jump. Hmmm.

Some peculiar things happening behind the scenes today...

As of right now, most of Europe has gained, with Greece gaining a whopping 3.80% on Germany's Angela Merkel and France's Nicolas Sarkozy saying that they will work with the European Central Bank to come up with a rescue package and also get private creditors to help share Greece's burden, rather than let Greece's bondholders suffer most of the damage. That sure sent the market up, but how is it gonna go down? Private banks stepping in to lend to Greece. Then what? What if Greece eventually fails to pay them back? I'm not an expert on this topic by any means, but from what I've read, I'm a little skeptical. Regardless of what I think, the US market is also up from this news, with the Dow at 12,061.73 (+100.21, +0.84%) right now.

Let's hope all is sweet as peaches next week.

Lunchtime Report
SET 1018.98 (+0.02)

SET opened higher, but failed to reach 1025, with a high of 1024.60 (+5.64). After getting stuck at 1024, the bears came in and brought it down to as low as 1017.79 (-1.17) before leveling off.

China, Taiwan, and India are down by more than 1 percent. Hang Seng is down by about half a percent. And Nikkei is slightly positive.

I would expect to see some big moves in the global market within the next week (that could go either direction) due to the results of the Greek bailout issue. If some private creditors steps in to help out, then we would see the markets improve. But all this does is basically buy time. It doesn't tackle the root cause in any way. The plans to reduce wages, cut government spending, and increase taxes in Greece would bring in more money for the government, but who's gonna accept that? If you were the common middle-class Greek, then this is gonna piss you off a lot. Hmm, let's see the governments and banks lend out bad loans, spend a lot of money, and is going to punish the people, who didn't get anything from it, for their terrible money management. That's the mindset. And it makes sense that they would be pissed.

But on the flip side, if the Greeks don't pay, and it is forced to default, then the domino effect will definitely reach Thailand. But first, it will reach all the Euro countries. Then, people will start worrying more and more whether or not Ireland, Spain, and Portugal are gonna go belly-up. Then investors' confidence around the world would suffer. There'll be a panic sell in the US market on fears of another recession. Foreign Investments in China slows down. Foreign investors are gonna pull more money out of the Thai market. SET goes down to 800-900 level. It's Doomsday all over again.

Am I being to pessimistic? Letting my imagination go a little too far. Maybe I need another cup of coffee and that hourly dose of nicotine. We will find out soon enough.

20/6/2011 4:50PM

SET 1013.09 (-5.87)

In the afternoon, SET opened lower, tried to come back up, but couldn't get past 1019. It then made a decline, closing at the day's low. Ugly. The top losing sectors of the day are Bank, Food, and Commerce sectors, each losing more than 1%. Currently, no sector indices are above their 20-day SMA, with most actually below the 50-day SMA. Also, on the weekly chart, the candlestick indicates an engulfing bear candle, which is not good. However, it's only Monday, so all of that can change. As long as the index closes above 1013.66, then we're fine. But if it closes below that point on Friday, then we have a confirmed engulfing bear, which is usually followed by a large drop the following week or two.

The next two major supports are 980 and 940 in my opinion. Sure, you'll see support in the 1000 area and also 990, but the major turning points would be 980 and 940. Why 980 and 940? 980 is because of the price projection from the descending triangle that I talked about before. 940 is the previous low in February 2011. Below 940 and we're in big trouble because there aren't any real consolidation zones between 940 and 800. Yes, 800... There are minor consolidations in the 910-920 area, 880 area, 850-860 area, 820, and then 800, but I think that if SET does break the 940, then the downward momentum will pick up even more and it'll drop. Remember that from June to November 2010, the market went up and up and up. So, expect a down and down and down, but a lot faster.

Oh, so gloom and doom. All the peaches seems to be wilting away. There's a black cloud over my head. But I do believe that we are in a turning point in the Thai and global market. If anyone uses the Guppy moving average model, you'll see that the long-term EMA's are flipping down. MACD is about to be lower than the February level. RSI is making its way towards that oversold area again.

So basically, the question is: How much more bad news and uncertainties can investors take? Like I said before, China is the only thing keeping the world afloat right now. Bad news from China will an immediate trigger point, I believe. One can only hope for the Greece thing to be okay.

You know...it's funny how brokers keep telling you to buy even though they've been selling all month.
Someone has to come up with a way to deal with this conflict of interest.

Oh yea, they're also gonna raise the commission by about 5% (this is the percentage for internet trading, it'll be less (in % terms) for broker trading) on July 1st.
Too bad for all you day traders. (As a rule of thumb, if something goes wrong in the market, blame the day traders!)

Lunchtime Report
SET 1024.26 (+11.17)

Stocks opened higher in Asia after Juncker assures that some sort of bailout for Greece will happen, but many are still firm on seeing positive results from Greece first. SET rose, but was unable to pass the 1025 resistance. Trading value is still relatively low at 8,470 million baht. Gains were led by Banking, Energy, and Food sectors once again. Momentum is looking good so far today, but if SET doesn't get past 1025, then we're gonna see a drop back down to 1020 or below.

The US market also rose yesterday due to the same news. Also, likewise, the US market traded with a relatively low volume. The big money are not jumping in, because they're waiting for confirmation. There's going to be a confidence vote in Greece today. Keep your fingers crossed.

21/6/2011 5PM

SET 1027.72 (+14.63)

Wow, lots of optimism here. SET passed the 1025 resistance in the afternoon, and went up to test the 1030 area. It didn't get pass it, but the index did good today. The intraday graph looks real nice. On the daily chart, SET closed slightly above the 10-day EMA. Personally, I don't consider it a signal, but it's comforting to know. Of course, you have the RSI and MACD moving up. The market is still bi-polar though. I wouldn't be surprised if tomorrow turns out to be horrible.

The real factor here is the confidence vote tonight. Expectations are high. The US and Euro markets are very sensitive right now and bad news can trigger a sharp (panic) sell-off.

Right now, the Euro markets are good, with indices rising from half a percent to a percent. Asian indices also did very good today.

Lunchtime Report
SET 1028.03 (+0.31)

So as you all know, the confidence vote was in favor of Greece's current PM, which means that the world is not about to end...yet. The next step is for Greece's parliament to approve the plans for budget cuts, selling of assets, raise taxes, etc, next week.

SET opened higher from the good news from Greece. It went as high as 1033.80 (+6.08) in the morning session but then went lower to form a triangle on the intraday chart, in which it broke down to as low as 1026.87 (-0.85) and closed the morning session at 1028.03. Judging from the trading range in the past few days, support would be at 1025 & 1020, and resistance will be at 1035. Let's see if it breaks the high of 1035.99 on 15/6/2011. If it does break it, then it could go as high as 1045, with 1045-1050 zone as the next resistance.

As for SET's daily chart pattern, as of right now, it isn't clear what pattern it's forming. SET has just come down from the top in April. The formation that led to the decline is likely to be a descending triangle, but it could very well be a diamond top also. Maybe it's both. Who the hell knows. I read today that some analysts think that the trend might reverse to an uptrend, but I can't say that it has bottomed yet. Overall, I'm still bearish. I'm gonna play it safe on this one and will start to be bullish when SET is above 1065, and will be bullish when it's above 1085.

Oh yea, I forgot to mention MALEE. Currently, +533.76% after coming out of suspension. Holy cow. I need to get me some of that...so that I can short it!

22/6/2011

SET 1023.86 (-3.86)

WOOOOO!!!! MALEE closed at 15.00 (+13.43, +855.41%). Oh smack! I change my mind. I don't wanna short you no more. It's unbelievable. Brand new millionaires were born today. I'm very impressed. At one point, I thought they were gonna go super epic, +1000%. hahaha. Too bad they didn't. It would have been ridiculous (in a good way).
Is the price justified? Actually, maybe... Before, its price was 1.57, with a P/E of 1.13 (from SET website 30/9/2010 data). If you expect the fair value to be around P/E of 10, then it's 15.70. Is this the correct way? Hmmm. You would need to study up to find that out.

As for the SET Index, it closed at the day's low. Imagine that! Good news from Europe and most of Asia is sluggish. Europe is in the red zone too, but not by much. The news says that Greek bonds rose so stocks and futures are down. It's an ugly time for the market as a whole right now. Its behavior is erratic at best. Closing at the day's high one day, and then closing at the low the next day. To be fair, the index did try to test the morning session's high in the afternoon, but it didn't make it, leading to a sell-off in the end. Nevertheless, it's a freakin rollercoaster ride. All the super risk aversed people who haven't gotten out of the market are defecating on themselves. Even though we're only in this 1010 to 1030 area, it's highly volatile due to the lack of direction and how fast it changes. We're going to have to let it ride out for a while longer to see what pattern SET is going to form, if it does form one at all. All you MAIs and ICTs are loving it though. All the other sectors are (-_-)'

So tonight the Fed are probably gonna announce that they're gonna keep interest rates at the same level and that they're not thinking about QE3 right now. The interest rate is basically zero, so not much they can do there! People are pissed at Bernanke. After the past two QEs, it seems clear that the US economy needs life support and raises a lot of doubts on whether there have been any real progress here.

Lunchtime Report
SET 1018.19 (-5.67)

SET opened lower today. It went down to a low of 1013.38 (-10.48), and tried to test the 1020 level, but could not get beyond 1020.09 (-3.77). SET support area is the 1010 zone. If it goes below 1008, then it could very well go down to 1000-1002. Let's hope that doesn't happen.

Bank, ICT, and Property Development sectors are suffering today, with ICT currently down by 2.44%, led by losses in ADVANC and DTAC stocks. The Food sector is up 0.64% right now, but this is due to MALEE pushing up the sector.
MALEE opened at 15.40 and then jumped up to 18.10 before coming back down and trading in the 17.30-17.60 range. The offers are starting to look dense.

Last night, the Fed lowered its growth forecast for the US this year, sending US indices down.

24/6/2011
SET 1014.13 (-9.73) (23/6/2011)

Elliot's third wave is coming and what we had hoped to be a stone castle turns out to be a sand castle that's about to be washed away. SET closed near the day's low and it doesn't look good tomorrow. I know I say that it doesn't look good just about everyday, but tomorrow is extra ugly. If you saw the European and US markets, then you already know. Virtually all markets in Europe declined by about 2% today, with some of the worst going down to almost 3%. The US is down about 1.5% right now.

The International Energy Agency (IEA) are going to release 60 million barrels of crude oil to make up for the decline in production from Libya. That sent oil down 4 to 5%, which sent metals and agricultural commodities down also. Looks like Saudi Arabia got what it wanted. So crude oil is going to drop further due to the European debt worries also. The question is whether or not IEA's decision is a good one. In the short term, it's definitely bad for stocks (as if it wasn't bad already). But in the intermediate to long-run, it might help with inflation and high food prices. While IEA believes that it is making up for the possible supply shortage, I hear that supply was too much to begin with already and this makes it even more oversupplied. Actually, I should say that demand had weakened already and increasing supply will just push prices down much lower as we have witnessed today.

For this Friday, well, it doesn't look too bright. I have a feeling that SET is likely to have a more than 1% drop, meaning that it's likely to test the 1000 zone. Then next week, we'll see what the Greek parliament will do. I think they're going to pass the budget cuts though. I mean, do they really want to be held responsible for a default that would potentially lead to the collapse of the EU? I don't think so. It's already hard enough for them to look at the leaders of other countries. To let Greece default would be an extremely unpopular move on a global level. The Greeks are in trouble anyway. There's no way around it. Either way, the people of Greece are going to suffer regardless of whether or not parliament passes the budget cuts.

Good luck strangers!

Lunchtime Report
SET 1016.64 (+2.51)

In the morning session, the market didn't drop like I expected; instead, it is sort of sideways, leaning to the plus side. Perhaps my predictions play a role because the market usually acts in the opposite direction of my predictions. :P Anyway, I really don't see the logic of it though. Crude oil dropped 4% yesterday and climbed back up a little over a percent today, resulting in a 3% drop from yesterday morning's price. But oil companies are still fine, down by only about 1%, with the Energy sector down by only 0.31%. BCP is down by about 2% though.

But what's the reasoning behind this? I thought it was going to be hell today. It's good that SET didn't plunge, but I still don't get it. Did investors overreacted last night, leading to a much higher drop than it should, given the amount of oil that's going to be released (60m barrels)? Did it turn out to be that it's not that big of a deal? I read that oil climbed back up today because, with IEA releasing the oil now, they won't have any to release in the future, so they're gonna have to buy it back if they want to have an emergency reserve...hmmm seems sorta backwards to me. For all the 3 readers who reads my posts (I hope there's at least 3! haha), please tell me what I'm missing here. Why is the market so calm about it?

Lunchtime Report
SET 1011.50 (-11.44)

SET declines on the same old reasons, plus Basel plans to raise reserve requirements for banks. The market is unpredictable as usual, a sideways behavior. For the afternoon, SET is to test the 1010 support area.

Also, Soros speaks on the idea of an exit plan for countries to discard the Euro. The problem lies in that the EU uses the same currency for different countries; therefore, treating these countries as if they were states and provinces when, in fact, they are not. The EU lacks control over individual countries the way a government controls states and provinces. Political and economic situations that are idiosyncratic to each countries interferes with the success of the EU. In order for the EU to function properly, countries would really need to act in accord with each other for the greater good. However, one cannot expect that to happen, since each country is ultimately looking out for their own benefit. The difference in politics, economic health, culture, and beliefs results in clashes, whether direct or indirect. Also, you have the problem of one country dragging its legs.

People are having doubts on whether or not Greece will be able to meet the conditions in paying back their loans. And they should. Greece suffers from a crucial problem of being "stuck in the middle". This refers to Michael Porter's theory that a company must choose whether or not they will be a niche producer or a low-cost producer. Being neither results in being stuck in the middle. Greece doesn't have a large poor population like many of the developing and underdeveloped countries, which means that it isn't likely to become a low-cost provider. At the same time, it does not have an advance enough infrastructure to really do very high-tech or niche products. This, in turns, causes Greece not to have any real competitive advantage. Either way, unless they are able to somehow become the main supplier of a new product, commodity, labor, services, whetever, their growth outlook is mediocre at best. (Greece's real GDP growth (adjusted for inflation) from 2003-2008 was roughly around 3.70%, whereas projection for 2011 is -4.8%.) I guess this is what happens when you have a mediocre economy with no real edge and slow growth, trying to recover from a global financial crisis. I don't think this is a problem that plagues only Greece. There are many countries becoming this way. Hell, even the US can't seem to recover.

You can always count on me for overcast skies.
Good Afternoon.

Lunchtime Report
SET 1084.28 (+42.80)

So the election is over and there seems to be some closure (for better or for worse) on the political situation for now. Greece is looking okay with the rollover plan. SET made an upward gap up this morning, opening up about 35 points higher at 1077.72, which is the highest upward gap in a long long time.

Turns out that the ugly period we've been having was an ascending triangle, with the upper boundary of 1035. The index broke that boundary on an upward breakout last Thursday before closing right on the 50-day EMA. Right now, SET is trading on the previous rebound made on 31/5/2011. If SET gets past this 1080 zone, then we will see the next major resistance at 1100. Last Monday, we were still at 1010. Support should be around 1070, but if the index does pass the 1080 zone, then 1080 should become the new support area. If it doesn't, and comes back down, then 1070 and then 1050. I'm expecting institutions, foreigners, and proprietary buying, and local investors selling. This seems pretty obvious, I think.

04/07/2011
SET 1090.28 (+48.80)

These are interesting times indeed. SET went to as high as 1094.26 (+52.78) in the afternoon session before closing a little lower at 1090.28. Leading sectors are Banking, ICT, and Property Development, all of which had an extensively high volume of trading today. Total value traded today was also very high at 63.11 billion baht. It hasn't been this high in a long time.

The SET daily chart made a leap to the moon today. All the indicators shot up. RSI went up to about 67. MACD went up, but it's still below the zero line. Let's see if the index will reach the previous high of 1113.63 (21/4/2011) in this upcoming week. Today's move makes SET more in-line with the Dow index in terms of recovery than most of the Asian markets. If the index goes above the previous high within the next week, we might have to wonder if we are getting ahead of ourselves, as the rest of the world is still playing catch-up. It could very well be that we will hover in the 1080-1110 area for a little bit as the rest of the world continues its recovery. We shall find out.

Lunchtime Report
SET 1089.94 (-0.34)

SET opened higher (1095.21) before there was a sell-off in the early morning. The index went down to 1080.98 before bouncing back up and trading in the 1088-1092 range. Leading sectors today are the Auto, Property Development, and Steel sectors. As said, I am not expecting any big moves just yet, given what happened yesterday, unless something drastic happens in the country. SET is likely to go sideways for a short time before moving higher. The bull is back on since SET made a higher high above the 1080 level yesterday. We see the 1080 support intact for now, which is a good sign. I would start to worry again if somehow SET manages to moves below 1050, but I don't think that will happen.

The ascending triangle pattern that formed over the past month was definitely hard to spot. It looked like a consolidation before moving down more, but it turned out to be the opposite. First, it looked as though we would see a double or even triple top pattern, but the upward breakout last Thursday would have invalidated that idea. I bet there were some analysts who drew an upward channel, given last Thursday's results, but they would be wrong. So with this huge runaway gap, we might see a move down to as much as 1050 which will fill the gap, but, again, I am not leaning towards that idea so much. I think we're going to trade within 1080-1100 in the short-run for the most part. (I consider yesterday's move a runaway gap and not a breakaway gap cause the upward breakout already happened. So even though it looks like it could be a breakaway gap, technically, I would have to consider it a runaway gap.)

As for other news, the US manufacturing index climbed higher than economists' forecasts, which gave a lot of confidence on the US recovery. The US market was closed yesterday for Independence Day, which meant that I got to listen to Charlie Rose Holiday Marathon. Hooray. Best Interviewer out there.

5/7/2011
SET 1084.59 (-5.69)

In the afternoon, the market picked up and went as high as 1097.07 (+6.79) before dropping sharply down to the close. Two words: Institutional Selling. The daily results hasn't come out, but I'm pretty sure that's what happened. They don't want the index to test 1100 just yet. Why do I think it's institutional? The selling is too coordinated, which is something that local investors and even foreigners can't necessarily pull off so well. Sure, foreigners do consist of international funds, but I don't think this is the case. I think Foreign buying pushed up the market, but Institutions pushed it down. Along the way, local investors are scared and sold off too, but more are placing the bid trying to get a good deal. Anyway, I don't think they're going to push it down that badly. They just want to push it down enough so there's room to play. What's too bad is that there are smaller stocks that don't attract the institutions, but get sold off in a panic by local investors, which means that they are not likely to come back soon. So for today, I would say Institutions, Proprietary, and Local Investors sell; Foreign buy.

Lunchtime Report
SET 1083.73 (-0.86)

SET moving sideways around yesterday's close. Seems to be some เล่นรอบ going on. Leading sectors are: Commerce, Food, Petrochemicals, Property Development, and Steel. Lagging Sectors are: Banking and ICT. Asian indices are mixed, trading within a range of -1% to +0.5%.

The afternoon session has some potential downsides as European markets will likely react to Moody's downgrade of Portugal ratings to "junk" grade. But judging from how Asian markets are responding, the concern is probably not as severe as Greece.

So I was a little bit off with my predictions yesterday. Turns out Proprietary had a net buy of 132m. Proprietary buying and selling is the hardest to predict for me. They vacillate like crazy and they have no distinct stocks or behaviors that I can pinpoint. If anyone knows how to spot Proprietary buying or selling, please let me know. I am interested to hear.