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Day March 25, 2009

Entries 3 Total

Chart Review of Citibank (C)

Mar 25, ’09 6:08 PM

Citibank. Much as I am bearish about its prospect for a long time to come, I have to acknowledge that there are factors beyond me that has prevented this company from going down completely.

Rather than figuring out such issues, let’s just focus on the chart and see if there are areas where we can trade this counter.

The good news is with the good bank-bad bank announcement, C has rally a fair bit.

While the chart shows Tenkan sen crossing Kijun sen on 19 March, what follows suggests that this rally for C is running out of momentum in the short term. The first key reversal comes when it hits the weekly resistant level of 3.85; one that sees it closes at the opening price of the previous day.

More importantly, look the kumo resistant ahead. Thick kumo cloud suggests that resistant levels will be heavy with trend still showing downwards pressure.

From the Kijun sen, we can see that it is flattening out. This suggest that the price level will  most likely remain at this level. My suspicion is , it will trade between $2 and $2.60

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DOW Weekly Chart as of 24 March

Mar 25, ’09 1:25 PM

With the recent rally, it is easy to find many news articles declaring that the market has bottom and it is all the way up.

But, it wasn’t that long ago when Obama was sworn in that we have such similar feeling.

Let’s go back to some fundamentals and let the charts tells us the story.

Here, we are going to examine DOW’s weekly chart.

3 things that shows the trend is still down (look at the respective points on the chart.

  1. Point 1. Tenkan sen is still trending down and beginning to flatten (signalling that short term it isn’t going anywhere)
  2. Point 2. Kijun sen is still trending down and DOW has not breakout of this resistant
  3. Point 3. The forward kumo shows that it is still trending down. With such a huge drop in recent days, what has change that can all of a sudden change the economy? Are banks going to lend money like back in 2007?

Moving forward, we see a fairly strong resistant at 8011 levels identified by the Chikou Span. Even if DOW manage to rally to this level, I doubt it will be able to break through this level.

 

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Shaw Group Inc. (SGR)

Mar 25, ’09 11:36 AM

With the recent rally, SGR continues to trade within its $25 – $30 range.

The recent selldown has seen SGR prices holding well at above the $20; a level depicted by the kumo as well.

We can also see that the current kumo is sloping up; a suggestion that it is trending upwards

Tenkan sen and Kijun sen cross has also been sighted on 18 March with the price level above the kumo. This is good signal to suggest that SGR is poised for a long term uptrend.

 

2009mar-shaw-group-inc-800x600

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