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ST Engineering: will it have a nice rebound?

Recently, STI was not bad. It went up from 3150 to 350-3360 within the past 1 and a half month. However, not every stock move the same way. Besides bank sector, a lot of Singapore stocks suffered severe sell down. Where are the opportunities in this kind of market condition? Those oversold stocks that had yet to rebound recently may have the potential to have a nice rebound.

ST engineering is one of good candidates short term traders may consider to monitor for rebound trade. It has been going down for the past one over years. From weekly, it can be seen that it dropped to a very strong support level of 3.35. Besides, the stochastic oscillator for weekly chart also generated an oversold signal, indicating a possible rebound. From daily chart, it is almost oversold. The price suffered a sell down since early Nov and has not had any strong rebound yet. In addition, when STI dropped almost 50 points on 1st Dec, ST engineering managed to hold well, it is another sign of strength. From fundamental perspective, the recent financial statement release on 7 Nov reported that revenue had a slight increase for 0.2% and earning per share only dropped 8%. The quarterly statement is considered ok as compared to the severe drop of ST engineering in share price for the past a few month, it may suggests that the current price maybe below its value and . If the price goes above the resistance for the past 8 trading days, it may trigger the beginning of a nice rebound. Do take note that ST engineering is in a long term downtrend, the setup is more for a short term rebound trade as explained above. It is not advisable to hold for very long term, like Buffet, for a downtrend stock.

Weekly chart:

Daily chart:

Robin Han
Robin Han

Dr. Robin Han, a graduated from NUS with a Ph.D in Department of Chemical and Biomolecular Engineering, has been actively trading in Singapore stock market since 2007. His passion has let Dr. Robin to become a full time trader since 2010. He has extensively share his experience with his fellow investors on trading Singapore stock market using both technical analysis and fundamental analysis.

Dr. Robin is a regular guest speaker for radio 95.8 on financial program. He also has been invited by different companies and societies to conduct educational seminars on stock investments, including Shares Investment, Wealth Directions (Founder: Dennis Ng), Traders Round Table, SIM, Raffles Business International, Online trader's club and Alpha Alliance. He is also contracted by N2N (a listed trading software provider in Malaysia) as their overseas educational speaker in stocks.