Orient Overseas (316 HK)

This shipping stock has been consolidating in a tight range between 11.75 and 12.50 for the past 7 days after falling from 13.25 last two weeks ago. With the change in sentiment and the increase in volume as well as the divergences seen in MACD and RSI, this stock can finally wake up from slumber and breakout.

Recommendation: Buy

Disclosure: Author is long 316 HK

Previous Stock Pick Update:

Pacific Basin (2343 HK)

This stock has moved up as expected since we included it in our stock picks. Author is still long the stock, but has sold half of position.

After consolidating between the 2.90-3.20 range, the stock broke out and went as high as 3.40, and closed near highs at 3.55. Note that the volume is still heavy and active. We maintain our target selling resistances at 3.60 and then 4.00. We would advice to take some profits, say half, off the table.

Recommendation: Hold until resistance of 3.60/4.00

Look to enter near possible support of 3.30 to 3.20 range.

Support: 12.00/11.80

Resistance: 12.90/13.50/15

Preferred Entry: 12.30 or lower