Thursday, October 29, 2009

STI Updates

Today's price action warranted a recount of the waves. STI closed right at the 50 MA.

There appears to be 2 scenarios for STI.

The first scenario, my preferred count, is that we are in the 2nd wave of a 5th wave of larger degree:

In this first scenario, STI will be going up after reversing from 50 MA.

The second scenario is that we could still be in a mega 4th wave instead as shown in the chart:

This second scenario points to more upside for STI in a final wave 5.

Both scenarios pointed to a break on the upside. I lost $290 buying call warrants today at STI 2660, which didn't reverse upwards in time by close. In this, I learned a lesson that for me, if I'm bullish for STI, I should buy STI ETF instead as it does not have time decay. There's no leverage in the earnings, but I would lose less money and be able to keep it overnight.

At STI 2648 today, I'm expecting STI to achieve at least 2740 again. I might look into buying some stocks, or perhaps STI ETF, for the final rally. It all depends if STI will break the 50MA support with volume.

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