Technical Analysis
Keppel Corp, SembcorpMarine

Keppel Corp ($9.13) – Downside to $8.20

The chart below shows the long-term chart of Keppel Corp from 2001 till current date and the preferred wave count. The stock has fallen below the March 2008 closing low of $9.38, which signals a resumption of the downtrend. What is worrisome is that the 15-day, 65-day and 200-day moving averages had converged and fanned down in end-June 2008, a mid-term bearish signal. This is the opposite what happened in April 2003 when the 3 moving averages converged and fanned up that resulted in a multi-year bull market.

Short-term, a minor rebound off $8.80 should be capped at $9.38 – 9.68 resistance level. Still, the trend remains weak and we see downside to $8.20, which is a key 50% downward retracement level. The 61.8% downward retracement level is at $6.50.

Sembcorp Marine – Downside to $2.95 – $3.05

The chart below shows the preferred wave count for SembCorp Marine. A gap down yesterday pins resistance at $3.54 to $3.66. The 15-day, 60-day and 200-day moving averages have fanned down after converging in August. We see the stock heading down towards the March low of $2.95 to $3.05. This level coincides with the key 50% downward retracement level. The 61.8% retracement level is at $2.43.

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