Dennis Ng wrote:
On 23 Dec 2011, when there was much fear and uncertainty regarding the Crisis in Libya, I wrote:
Libya only ranks 17th among world oil producers, so I'm not worried if the government falls. But it is the First OPEC country to be in trouble, Tunisia and Egypt are not part of OPEC.
The worry is whether this unrest can spread to other countries, such as Iran (2nd biggest exporter amongst OPEC countries after Saudi Arabia.
So I'm not worried unless something happens to Iran or Saudi Arabia. Below is supporting info on what I wrote.
Below is a ranking of Major Oil Producing Countries: (Libya is ranked 18th on this list, but I think they are 17th becos U.S. does not produce enough oil for itself, it does not export Oil).
http://en.wikipedia.org/wiki/List_of_co ... production
Cheers!
Dennis Ng
21 Feb 2011
Libya exports some 1.1 million barrels of crude a day from production of 1.6 million barrels — ranking it about 17th among world oil producers. And it has the largest proven oil reserves in Africa.
The United States, the world's largest consumer of oil, does not import any petroleum from Libya. But disruptions elsewhere can raise the price of oil worldwide.
Even more worrisome for oil markets is the potential for instability to spread to other countries in the Organization of Petroleum Exporting Countries, especially Saudi Arabia and Kuwait.
Saudi Arabia has not been the scene of protests, but the kingdom sits atop the world's largest reserves of conventional crude.
Dennis Ng Analysed Middle East Crisis on 23 Feb 2011
Moderators: alvin, learner, Dennis Ng
Dennis Ng Analysed Middle East Crisis on 23 Feb 2011
If you're my Seminar Graduate, you would be able to access part of this forum, which is only available to my graduates, where I share with them the latest analysis and views.
Cheers!
Dennis Ng - When You Master Your Finances, You Master Your Destiny
Note: I'm just sharing my personal comments, not giving you investment advice nor stock investment tips.
Dennis Ng - When You Master Your Finances, You Master Your Destiny
Note: I'm just sharing my personal comments, not giving you investment advice nor stock investment tips.
I agree, if it gets out of control, the World will be in trouble, not just Singapore.jamestai wrote:Hi,
Today at Singapore Parliament debate, MPs also raise concern of the Middle East crisis if out of control may send Singapore into another recession.
James Tai
In case you miss what I wrote on 23 Feb 2011:
Dennis Ng wrote:
Libya only ranks 17th among world oil producers, so I'm not worried if the government falls. But it is the First OPEC country to be in trouble, Tunisia and Egypt are not part of OPEC.
The worry is whether this unrest can spread to other countries, such as Iran (2nd biggest exporter amongst OPEC countries after Saudi Arabia.
So I'm not worried unless something happens to Iran or Saudi Arabia. Below is supporting info on what I wrote.
Cheers!
Dennis Ng - When You Master Your Finances, You Master Your Destiny
Note: I'm just sharing my personal comments, not giving you investment advice nor stock investment tips.
Dennis Ng - When You Master Your Finances, You Master Your Destiny
Note: I'm just sharing my personal comments, not giving you investment advice nor stock investment tips.
Today's newspapers also state that the US forces are heading towards Libya to pressure kadafi to step down.
Last night's news also highlight another worrying situation between the US-South Korea joint military exercises, which North Korea finds threatening. Tensions might start to rise again if North Korea cannot control their urge to hit their buttons and send their warheads over.
Hopefully there can be peace in middle east soon, then at least oil price can fall back down and stabilise, else it will be further inflation of goods that will eventually affect consumers.
Last night's news also highlight another worrying situation between the US-South Korea joint military exercises, which North Korea finds threatening. Tensions might start to rise again if North Korea cannot control their urge to hit their buttons and send their warheads over.
Hopefully there can be peace in middle east soon, then at least oil price can fall back down and stabilise, else it will be further inflation of goods that will eventually affect consumers.
Best scenario is Libya's internal war dragging for a few more months without massive casualties, then Saudi increases the oil volume to top up the gap left by Libya, finally Gaddafi is wiped out a few months later.
This way:
1) Middle east crisis will be downsized to Libya crisis, attracting all the media attn (sometimes mass media is fanning the fire), distracting attn on other emerging riot countries in Middle east (giving more time for these countries to throw $ to calm down the people). The fire of middle east will be contained and ceased in Libya over time.
2) Whole world will "get used" to middle east crsis = Libya crisis, stock has been corrected to reflect the oil$ increase, subsequently will move up again.
3) If Saudi takes action to over supply, oil price will be suppressed. US navy going around the middle east region as world policeman will help to give some confidence to the west, they can wait and see, taking action if needed to protect the interest of US
4) Eventually, Gaddafi will step down, giving a strong boost to the stock market. This round, chances for another country having major riot will be less if the Libya crisis can be dragged longer without major casualities.
US will protect its interest in economy recovery (navy is now in middle east + making use of UN and other European alliance), unlikely to let middle east crisis destroy its plan. Dow Jones has shown its strength recently to lead the world's stock indices, when it is down/up, Europe & Asia will follow (except sometimes China shows slightly diff trend). Good sign for STI to build a strong bottom, as long as there is no new major bad news (other than oil$ set record high), it has good chance to go above 200 day MA by this week, and gradually recover from this major "sickness".
Hope other middle east countries will take this time to calm down the situation in their own countries. If Libya's crisis ends too early, fire (still hot) will likely to spread to the next country. Only time (cool down), money (gov bonus) and the fear (price to pay for freedom by observing other countries) may kill the passion to change...
This is just my view.
This way:
1) Middle east crisis will be downsized to Libya crisis, attracting all the media attn (sometimes mass media is fanning the fire), distracting attn on other emerging riot countries in Middle east (giving more time for these countries to throw $ to calm down the people). The fire of middle east will be contained and ceased in Libya over time.
2) Whole world will "get used" to middle east crsis = Libya crisis, stock has been corrected to reflect the oil$ increase, subsequently will move up again.
3) If Saudi takes action to over supply, oil price will be suppressed. US navy going around the middle east region as world policeman will help to give some confidence to the west, they can wait and see, taking action if needed to protect the interest of US
4) Eventually, Gaddafi will step down, giving a strong boost to the stock market. This round, chances for another country having major riot will be less if the Libya crisis can be dragged longer without major casualities.
US will protect its interest in economy recovery (navy is now in middle east + making use of UN and other European alliance), unlikely to let middle east crisis destroy its plan. Dow Jones has shown its strength recently to lead the world's stock indices, when it is down/up, Europe & Asia will follow (except sometimes China shows slightly diff trend). Good sign for STI to build a strong bottom, as long as there is no new major bad news (other than oil$ set record high), it has good chance to go above 200 day MA by this week, and gradually recover from this major "sickness".
Hope other middle east countries will take this time to calm down the situation in their own countries. If Libya's crisis ends too early, fire (still hot) will likely to spread to the next country. Only time (cool down), money (gov bonus) and the fear (price to pay for freedom by observing other countries) may kill the passion to change...
This is just my view.
Hi ein55,ein55 wrote:Best scenario is Libya's internal war dragging for a few more months without massive casualties, then Saudi increases the oil volume to top up the gap left by Libya, finally Gaddafi is wiped out a few months later.
This way:
1) Middle east crisis will be downsized to Libya crisis, attracting all the media attn (sometimes mass media is fanning the fire), distracting attn on other emerging riot countries in Middle east (giving more time for these countries to throw $ to calm down the people). The fire of middle east will be contained and ceased in Libya over time.
2) Whole world will "get used" to middle east crsis = Libya crisis, stock has been corrected to reflect the oil$ increase, subsequently will move up again.
3) If Saudi takes action to over supply, oil price will be suppressed. US navy going around the middle east region as world policeman will help to give some confidence to the west, they can wait and see, taking action if needed to protect the interest of US
4) Eventually, Gaddafi will step down, giving a strong boost to the stock market. This round, chances for another country having major riot will be less if the Libya crisis can be dragged longer without major casualities.
US will protect its interest in economy recovery (navy is now in middle east + making use of UN and other European alliance), unlikely to let middle east crisis destroy its plan. Dow Jones has shown its strength recently to lead the world's stock indices, when it is down/up, Europe & Asia will follow (except sometimes China shows slightly diff trend). Good sign for STI to build a strong bottom, as long as there is no new major bad news (other than oil$ set record high), it has good chance to go above 200 day MA by this week, and gradually recover from this major "sickness".
Hope other middle east countries will take this time to calm down the situation in their own countries. If Libya's crisis ends too early, fire (still hot) will likely to spread to the next country. Only time (cool down), money (gov bonus) and the fear (price to pay for freedom by observing other countries) may kill the passion to change...
This is just my view.
great analysis! Thank you for sharing.
Cheers!
Dennis Ng - When You Master Your Finances, You Master Your Destiny
Note: I'm just sharing my personal comments, not giving you investment advice nor stock investment tips.
Dennis Ng - When You Master Your Finances, You Master Your Destiny
Note: I'm just sharing my personal comments, not giving you investment advice nor stock investment tips.
Volume distribution shows that some big players start to enter STI, help to push up the price. Hope this will help to attract more fund managers to come back to STI, esp when price is above 200 day MA again (above it during intraday today, closing just below, another chance tmrw).
As you can see, fear in oil$ is already factor in, investors are willing to take risk to buy up, greed > fear now, until when oil$ goes up to next higher level, then they will take some profit and causing a small dip, but the mid term trend will be reversed, up is more than down in each short term tradings.
Dow Jones may be supported by good job data (will know on Friday).
When few people really care about Libya news, it will be time for the next rally to come. If Middle East crisis can be ended gradually this way (meaning worst time is gone), we need to thank Gaddafi. Usually we need a more severe & longer event to attract all the attn (all the fire will burn at one spot, but the path of fire may end there).
This is the similar to the case of Lehman Bro, we need to thank them for creating a deep valley, else bear market won't be just 6 months long (Sep 2008 to Mar 2009), it could be a slow/gradual and painful downturn.
If we use similar analogy, STI is the worst stock market performance in the past 3 months, assuming all markets recover to the same state as in Nov 2010, then STI will have the largest gain.
It is still too early to judge, let's wait and see at the moment, as Chinese says: "use no-change to deal with all-changes" (yi3 bu4 bian4 ying4 wan4 bian4)
As you can see, fear in oil$ is already factor in, investors are willing to take risk to buy up, greed > fear now, until when oil$ goes up to next higher level, then they will take some profit and causing a small dip, but the mid term trend will be reversed, up is more than down in each short term tradings.
Dow Jones may be supported by good job data (will know on Friday).
When few people really care about Libya news, it will be time for the next rally to come. If Middle East crisis can be ended gradually this way (meaning worst time is gone), we need to thank Gaddafi. Usually we need a more severe & longer event to attract all the attn (all the fire will burn at one spot, but the path of fire may end there).
This is the similar to the case of Lehman Bro, we need to thank them for creating a deep valley, else bear market won't be just 6 months long (Sep 2008 to Mar 2009), it could be a slow/gradual and painful downturn.
If we use similar analogy, STI is the worst stock market performance in the past 3 months, assuming all markets recover to the same state as in Nov 2010, then STI will have the largest gain.
It is still too early to judge, let's wait and see at the moment, as Chinese says: "use no-change to deal with all-changes" (yi3 bu4 bian4 ying4 wan4 bian4)
HI Ein55,
I agreed with you, STI trend has reverse, I am confident of that after looking at USA market open higher today. As long as Iran, Kuwait and Saudi don't come out with news of any theoor people protest, retail investor are in a rush to buy stock while the price is still low before the correction started few weeks ago. In fact my stock portfolio today has zero loss so my profit is coming back
.
James Tai
I agreed with you, STI trend has reverse, I am confident of that after looking at USA market open higher today. As long as Iran, Kuwait and Saudi don't come out with news of any theoor people protest, retail investor are in a rush to buy stock while the price is still low before the correction started few weeks ago. In fact my stock portfolio today has zero loss so my profit is coming back
.James Tai
Hi James,
In fact, those concerns (eg. middle east crisis, high oil$, inflation, even Euro debt crisis which somehow is forgotten) are still there. There is always a balance point between fear and greed, which creating numerous cycle, either short/mid/long term.
When people starts to sell down because of great fear, STI can go as low as 250 day MA. Similarly, when these people starts to see prices are up, they will come in again to buy. Market is very volatile. After the recovery of stock market, we must treat this as lesson learned, balance greed and fear again, not to fall into the same trap again (even if market can recover, the feeling of 10-20% correction is uncomfortable). Some mid term trading may be required in future to minimize the risk of volatile market.
Now we can only say the upside potential is higher than downside, with condition that there is no major good/bad news. Reversal of STI still requires stronger upward force for confirmation: first standing above 200 day MA (>3050), then breaking 3100 (build a strong support, same level after the Egypt crisis / before Libya correction); then next resistance of around 3180 (above midpoint of current correction, reversal can be confirmed) before the Egypy crisis; and then 3240, 3280, 3300... many gates waiting in front, not an easy journey.
In fact, those concerns (eg. middle east crisis, high oil$, inflation, even Euro debt crisis which somehow is forgotten) are still there. There is always a balance point between fear and greed, which creating numerous cycle, either short/mid/long term.
When people starts to sell down because of great fear, STI can go as low as 250 day MA. Similarly, when these people starts to see prices are up, they will come in again to buy. Market is very volatile. After the recovery of stock market, we must treat this as lesson learned, balance greed and fear again, not to fall into the same trap again (even if market can recover, the feeling of 10-20% correction is uncomfortable). Some mid term trading may be required in future to minimize the risk of volatile market.
Now we can only say the upside potential is higher than downside, with condition that there is no major good/bad news. Reversal of STI still requires stronger upward force for confirmation: first standing above 200 day MA (>3050), then breaking 3100 (build a strong support, same level after the Egypt crisis / before Libya correction); then next resistance of around 3180 (above midpoint of current correction, reversal can be confirmed) before the Egypy crisis; and then 3240, 3280, 3300... many gates waiting in front, not an easy journey.
Thanks for sharing ein55 but how about the recent election in singapore does the bb come in to rally up to picture a good and prospect singapore? So far singapore PE is ard 11 to 12, the most laggard.. As what dennis mention, there might be another rally which I agree between mar to may plus if funds transfer back to the asia with a huge volume to push it higher, why not.. From what I have observed, this correction often make people to look out for cheap bargain stock to reassess their portfolio.. If you are a trader, you should know those who drop has rise up much in matter of the past 5 days, olam, noble, osim, singtel, biosensor and etc.. Once it hit its low, bb/full time trader come in and load up before the stock price rise.. So far, I can see greed is greater than fear, that why now it is only a small term correction despite oil price rise, there would be always people buy up. I feel this war could end in 2 weeks and stock shall rally up soon when I dunno know.. So far strong fa stock and reits hasnt drop much to 10 to 20 or m1, starhub and a few.. So it is not a MAJOR correction for STI, there is hope on it.. 
Short term is bullish for STI ... MACD of STI just cross upward, stochastic is 50% at mid point with upward potential. Candlestick pattern today is a bullish inverted hammer, same upward trend today may be repeated tmrw, with the help of bullish Dow Jones (over 150 points so far).
STI needs more "greedy" investors to support the price with high volume (price up/down by retail investors with low vol is very unstable).
STI has good chance to cross 200 day MA and 19 day MA tmrw (if really so, the duration of this correction is as long as the last Euro crisis in May 2010, STI was about 6 weeks below 19 days MA). If there is no surprise in US Feb unemployment data tmrw (hope analysts don't overestimate the number again), likely Asia market will continue to be bullish next week, till something unexpected happens again...
Anyway, don't intend to sell when market was corrected in last 1 month, now also don't intend to buy.
STI needs more "greedy" investors to support the price with high volume (price up/down by retail investors with low vol is very unstable).
STI has good chance to cross 200 day MA and 19 day MA tmrw (if really so, the duration of this correction is as long as the last Euro crisis in May 2010, STI was about 6 weeks below 19 days MA). If there is no surprise in US Feb unemployment data tmrw (hope analysts don't overestimate the number again), likely Asia market will continue to be bullish next week, till something unexpected happens again...
Anyway, don't intend to sell when market was corrected in last 1 month, now also don't intend to buy.
We may not expect good news during general election, but at least quite sure gov won't announce more bad news such as on Jan 14 on property tax. So, no bad news = good news at the moment.
The only unlikely major bad news from GE is PAP loses 1/3 seats to opposition, then stock market will suffer. In fact, in avg, even the worst opp party candidate can win around 1/3 vote of the constituency, it does not mean they will win 1/3 support, it simply means 1/3 of people is not supportive of gov. However, simple majority wins all, even 51% votes will win 100% of the seat(s).
Besides the economy climate now is in favor of PAP (similarly for Malaysia, likely will have GE in next 6 months, strike the iron while it is hot). Opposition party will fight with one another to get the free 9 MP seats reserved for them in parliment.
Economy is always the foundation of political and national stability. Regardless of political system (US, Europe, China or Singapore styles...), as long as people can live well, very few wants to take the risk to "change". Middle East is a negative example, wealth gained from oil is controlled by a small group of people, most people are poor, not surprise to see them standing up for this rare opportunity of lifetime to change.
Perhaps someone can help to check the stock market record of last few rounds of GE, whether there is a strong correlation with rally. If yes, research team in GIC probably has estimated the end of middle east crisis and recovery of STI in next 3 months. Gov is still in control of the election date, if anything unexpected happens, they can on hold till early next year, or they could activate GE within 1 month.
The only unlikely major bad news from GE is PAP loses 1/3 seats to opposition, then stock market will suffer. In fact, in avg, even the worst opp party candidate can win around 1/3 vote of the constituency, it does not mean they will win 1/3 support, it simply means 1/3 of people is not supportive of gov. However, simple majority wins all, even 51% votes will win 100% of the seat(s).
Besides the economy climate now is in favor of PAP (similarly for Malaysia, likely will have GE in next 6 months, strike the iron while it is hot). Opposition party will fight with one another to get the free 9 MP seats reserved for them in parliment.
Economy is always the foundation of political and national stability. Regardless of political system (US, Europe, China or Singapore styles...), as long as people can live well, very few wants to take the risk to "change". Middle East is a negative example, wealth gained from oil is controlled by a small group of people, most people are poor, not surprise to see them standing up for this rare opportunity of lifetime to change.
Perhaps someone can help to check the stock market record of last few rounds of GE, whether there is a strong correlation with rally. If yes, research team in GIC probably has estimated the end of middle east crisis and recovery of STI in next 3 months. Gov is still in control of the election date, if anything unexpected happens, they can on hold till early next year, or they could activate GE within 1 month.
Daily chart: STI standing above 200 day MA again, 2 times this week. MACD just cut from bottom, bullish sign.
Weekly chart: STI ending 3 consecutive downward weekly trend (ending pattern of correction is quite similar to May 2010 during Euro crisis), first week with positive gain, bullish sign for mid term if it can continue to grow for 1 more week with increasing volume.
Next week's target will be 3080-3100 resistance, while 2 day MA cutting 19 day MA.
Weekly chart: STI ending 3 consecutive downward weekly trend (ending pattern of correction is quite similar to May 2010 during Euro crisis), first week with positive gain, bullish sign for mid term if it can continue to grow for 1 more week with increasing volume.
Next week's target will be 3080-3100 resistance, while 2 day MA cutting 19 day MA.