Mdm Chew Gek Khim, Executive Chairman, Straits Trading Company Ltd
Straits Trading Correlation Chart with Copper (6 mths Translation) & Straits Trading Daily Chart, 2-year
Straits Trading’s (listed in SGX) business segments are mainly focused on tin smelting and real estate. The company is unique in a sense that 86% of its revenue was contributed by tin resource segment but 64% of its operating income came from real estate.
On the chart above, we displayed the inter-market analysis between Straits Trading with Copper futures.
Pls note Copper is used as a proxy for tin as there is no available tin futures data to refer to. Based on our proprietary methodology, by pushing copper price action out by 6 months forward, we note that the inter-market analysis revealed a 65% probability (or correlation) of Copper futures leading Straits Trading by 6 months.
This also imply that there’s a 65% chance of Straits Trading trending above the resistance of $3.70 over the next 6 months.
From the Daily Chart of Straits Trading (inset), we can see that a decent entry price will be at around 3.30+/- (black horizontal resistance turned support line). A potential cut-loss level will be at 3.20 (yellow horizontal line). With such a setup (presume enter at 3.3, exit at 3.7 or cut loss at 3.2), we are looking at a very decent risk-reward ratio of 4x.
As usual, kindly do your own due diligence & assess if the Technical Analysis opinions are applicable to your trading/investing needs. Brought to you by Thomas Ng’s Investment Ideas Broadcast Group.
As usual, this writeup was broadcast to Clients on 14 April 2021 but posted here only on 17 Nov 2021.
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Image source: https://www.businesstimes.com.sg/companies-markets/straits-trading-launches-private-placement-to-raise-s809m-priced-at-s311-per-share