I am not trying to be a contrarian here, but I have to say the bull market is not here yet, it won’t be here until the markets at least reach the highs of previous year. Is the bear over? I am not sure, but I think it is a little further now. As the market bounced off the low and had a best week in 5 years, it sure proved the market is starting to feel confident about the Fed, but economy is still weak, the housing marketing might continuing tumble. You never know when would the markets be plummeting again. Therefore, from a neutral point of view, I dare to say it that we might already entered the range bound markets.
Value investing and good entering/existing strategies are very crucial in range bound markets. So rather than hoping for high returns over the years, I do recommend some mid term swing trading instead. If you are a very long term investor, and has no hurry to take your profits, then value investing is right for you. Wish you make the right choices.
This week I am stilling going to discuss 6 China related stocks. As Chinese stock markets are at their support levels, if the snow storm come to an ease, and the optimists of Beijing Olympics expand, there will be another rise in Chinese stocks.
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1. ACH: The news on Friday seemed like brought some momentum to ACH. The trend line has been broken, the next resistance is around $50, where also lies 200 EMA. The support is at $33, but if the price fell back to the trend line and break it down, it might be a dangerous sign. The company’s fundamental is very strong, and PE is at the right level. I personally like it very much. However, discipline is the key when you do swing trading.
2. GSOL: The chart indicate a bullish divergence, but the price is just below the resistance. If the resistance could be broken in this week and stay above it. It might be a good buy. Then the resistance could act as support. Raise your stop, if the price moves up.
3. HNP: HNP is still below that major trend line, but CCI indicates a improved momentum. The support is around $32, be discipline and ride the momentum. If the price could break the trend line this week, the next resistance is around 42. So make your own decision.
4. STP: I have been talking this stocks in many of my previous posts. But this time, it seems like an upward strength. I covered my shorts. I am ready to enter again, ride the upward trend if the price could break 57.50 level (VWAP)
5. TSL: This might be an dangerous plan, the company announced an change in the management last week, the price gapped down about 4 $, but it still hold above its support level. I will watch it very closely. Watch for any weakness or strength.
6. QXM: The company trading at a range between $9 and 7, so wait patiently, see which side it breaks first.
There are no major economic data this week, so the earnings are probably the only thing that will guide the market, but do pay attention on “surprise” news, and see how the merger deal between MS and Yahoo! goes. If the deal could get approval, I won’t be surprise to see other merger deals…. Apple and eBay maybe?
Good Luck and Happy Trading 
