2020 has been a rather slow but steady year for banks. Despite some noise from geo-political instabilities, banks has seen less than a 3% decline on any given week. Instead, they have supported the STI while showing some volatility in the past weeks.
Short term outlook (Weekly Chart)
The point to note about this simple TA is that OCBC has closed on a weekly chart higher that its downtrend resistance. This is significant because there has been downward pressure in the banking sector due to the massive Quantitative Easing measures in US causing interest rates to go down and borrowing to become much easier. However, as seen on the chart, OCBC like other SG banks has been quietly consolidating and will likely continue its uptrend above the resistance turn support line as shown above if it holds.
My next price to look out for is 11.4 where the fibo resistance will be challenged. Do notice the charts has not be following entracement lines thus it might easily cross it. Presently, it is good news for those who bought at the lows of 10.6 and held until now despite volatility in the past weeks. Will need confirmation from next week’s candlestick to gain more certainty and clarity in the trend ahead.
Author Call (as of 11 Jan 2020)
- Break out from downtrend resistance spotted after many months of consolidation
- 11.4 fibo resistance might trigger a wave of profit taking
- suggest to buy if more signals of recovering are shown in the coming week
- HOLD will be the best call as of now
Author Call (as of 14 Dec 2019)
- Bounce from 10.6 region has crossed 20 days MA resistance
- Heading towards 11.12 in the coming days then 11.8 (horizontal resistance)
- Potential upside for counter due to phase one of trade deal
- Tensions between China and HK has mellowed as protests are less violent
- Price likely to recover for the rest of the month
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