Raffles Education – Bounced back from the Channel Support?

Raffles Education closed at $0.445 on Friday and formed a Bullish Harami candlestick pattern. Coincidently, the stock price bounced back from the $0.435 supports level (38.2% Fibonacci Level and Channel Support). If next session opens with a gap up and closes with a bullish long white candle, a Three Inside Up pattern is formed which confirm a trend reversal.

Another thing to take note is there were Insiders Trading for the past three months. The substantial shareholders were increasing their shares holding. Mr. Chew Hua Seng is the Chairman & CEO, Ms Doris Chung Gim Lian is the spouse of Mr. Chew, Mr. Henry Tan Song Kok is the Independant Director.

The analysis shows it is rather safe to trade at this price level due to the following reasons:
  1. Strong Support (Channel Support and Fibonacci Level) base on the chart.
  2. Bullish Harami candlestick normally either moves sideway or upward (trend reversal)
  3. Price of Insiders’s transaction between $0.475 to $0.55.
Thus, the downside probability is minimal.
My Swing Trading Plan:
  • Entry Level $0.44 to $0.46
  • Profit Target = 10%

China Fishery – Insiders Buying

Two substantial shareholders of China Fishery (Pacific Andes Limited and Golden Target Pacific Limited) started the shares acquisition at $1.16 since Aug 18, 2009.

The shares acquisition is still on going and the trading volume is pretty thin for the past two weeks. Normally it is a good sign if there are insiders buying.
In addition, the stock price is on a nice trend (200D MA on a up trend). Although I have sold half of my positions to take profit, I am still holding half of it as long term investment amid the concerns of big correction. I am watching very closely whether the stock can stay above the 20D & 50D MA if the correction comes. If yes, I will probably increase my position in this stock.

Insiders Selling in US stocks

Entering 3rd week of September, I am getting very cautious on the stock market and also waiting eagerly of the market correction. I plan to off load my penny stocks this coming week as things do not really look good and I just don’t feel comfortable holding the stocks now.

I read two consecutive reports regarding the insiders selling these few days. The reports mentioned that there are many Corporate officers and directors in US have been selling the shares at great pace since August. They are the one who know the company inside out and they know what is the fair value of their company. In the principle of “Buy Low Sell High”, this selling of stocks by insiders is a very clear signal that the stock price is over value and the future earnings do not justify the current stock price. This is the leading indicator that stock market is going for a correction very soon. I will believe this indicator more than other analyst reports and preserve my cash first!