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Monday, 16 July 2012

Swiber Technical Analysis: 16 July 2012, Monday, 7.30am Singapore Time


Swiber Technical Analysis: 16 July 2012, Monday, 7.30am Singapore Time

Swiber: Weak Price Structure.
Price of the company will collapse. Company is highly leveraged (high amount of debts and loans for operation), and under a new economic environment that is forward-looking, the company will go into distress or trouble:
1. US Dollar will hit bottom (because no more QE can be implemented anymore), and the rise in USD will cause oil prices to reverse to bearishness.
2. Even if oil price does not crush these highly leveraged oil and offshore companies, the interest rates that will rise from the rock bottom will crush them.

If boulder number 1 as above does not crush the stock price of such companies like Ezion, Ezra and Swiber, the next boulder number 2 that subsequently comes is equally deadly. Highly leveraged oil and offshore companies will either be severe casualty (50%-80% drop in prices), or die and rest in peace forever (bankruptcy and delisted).

Donovan Rating: accumulate long term SHORTS as indicated in Technical Analysis Chart.

2 comments:

  1. Thanks for the analysis. May I know what is your duration for long term shorts ? tia

    ReplyDelete
    Replies
    1. 8 months or more. Add slowly using paper profits on each max rebound.
      There is a strategy for it, earlier shorts don't need strict tight loss but subsequent shorts using merely paper profits to add on needs tighter stops. Needs a lot of careful planning. It will enable snowballing of profits (max returns for the same capital). It also requires a lot of patience just like fishing for the bigger fishes using earlier fishes caught.

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