Anecdote: You've had too much of stock trading when....

...you start to unknowingly use stock tickers to replace the real names of the companies during a conversation with your wife.

It did happen to me a few nights ago. I rendered OT work, and ate dinner at Jollibee. When I got home, my wife and I had a little conversation. She asked me "saan ka na nag dinner?" and I unknowingly answered her back, "sa JFC! ". And ofcourse I got a blank stare from her and she replied "saan? sa KFC?". =)

If you have your own anecdote to tell or if you have any other ideas on "You've had too much of stock trading when..." or "You've had too much of technical analysis when..." , do leave a comment to share. I'll post those stories or ideas next week, just for fun. =). Thanks!

StockWatch (Dec 17-21, 2007): PSEi, SMC, MWC, SMPH

PSEi (Chart: Daily Resistance: 3630 Support: 3500/3450)

After a great upward move breaking the resistance line, the index was unable to hold its position above the resistance line and fell below the line. The gains that was made the previous week was wiped out last week. The bearish move by the index was a surprise for me as I was very much expecting that the index would probably move sideways and consolidate further before moving upward considering the bullish signs that is has manifested. Looks like the general expectation that the index will reach 4000 level before the year end will not happen. We only have this week to consider as a normal trading week as the trading action on the last week of the year will probably be lethargic as some may be on holiday mode already. So it will be impossible for the index to rally 500 points in just 1 week. The index may still reach the 3520 level next week before moving either sideways or upward in between 3600-3700

SMC(Chart: Daily Resistance: 60.50/62 Support: 58/55)

SMC and SMCB had a very bullish move last week breaking several resistance lines with large volume. The stock went as high as 60.50 and may still continue to move probably reaching up to 62. However, looking at the 3 consecutive trading days where it made a wild run upwards, it has formed a “Three advancing white soldier” candle stick pattern, with the third candle stick showing signs of weakness as the body of the candle stick is smaller relative to the first and second candle sticks. I believe that the recent upward move is already a sufficient gain for those who have this stock, so it would be best to start cashing in on those gains. The stock is still bullish, so we can just buy back at later time, probably with in the level of 50-55. Don’t forget the ex-div date on Dec 18, if you get too complacent with the recent bullishness of the stock, you just might find yourself loosing some gains come ex-div date.

MWC( Chart: Daily Resistance: 18.50 Support: 17)

MWC is showing signs of divergence of MACD movement against price. Price has formed a higher high, while MACD seems to be having a hard time to establish a higher high. Price as seen on past movement, after a run up, the price action goes on sideways, so expect that price may move sideways with support at 17. Watch out if price moves below 17 with volume. If it does, we may see price to move towards 13.

SMPH (Chart: Daily Resistance: 10.75 Support: 10/9.30)

SMPH broke down from a support line of around 10.50 and with large volume. As of current the area pattern seems to be a head and shoulder or a symmetrical triangle. Either way, its downward target price is around 6.00. However, RSI is currently oversold, so there is a chance that a bounce may happen and hopefully that bounce would have volume that may counter the effects of the breakdown. If that bounce is able to counter the breakdown, then that is a very bullish action and may be considered as a failed head and shoulder. Assuming this becomes a failed head and shoulder, a good volume to support the action would be around 30M shares. Otherwise it’s just a futile attempt by the bulls to re-instate the price above the resistance line.

In Retrospect: COL, BPC, MIC

COL

COL retraced 60% of its recent short upward move placing the stock near the resistance line of the symmetrical triangle. As of current even with the recent downward move, the stock still displays some bullish signs. The MACD is still above the signal line, the MA’s are still in the proper order, and the volume on the downward move were not accompanied by volume as there was more volume on the days when it was bought up, than when it was sold down. If this stock is still bullish, it may be able to pull up above the 65day MA and hopefully consolidate and hold its position above the MA. Otherwise, if the stock has really turned bearish, we can confirm it if it breaks the 10.75 support.

BPC

BPC was unable to hold its position above the resistance-turned-support line and went back in the triangle on the last trading day. This stock may still move further downwards probably reaching 3.80.

MIC

MIC did not break out from the symmetrical triangle last week. Instead it consolidated further. The price action is now near the apex of the symmetrical triangle, there is a higher possibility that we may have to redraw our triangle. What this stock currently needs is for it to consolidate in between 7.30 -7.80, the price levels of the previous gap down last October so as to eliminate resistance coming from those still holding position at those levels. For the coming week, this stock will probably move down to sideways. Watch out for support at 6.10

StockWatch (Dec 10-14, 2007): PSEi, COL, BPC, MIC

PSEi (Chart: Daily Resistance : 3770/3810/3890 Support: 3680)

The index showed further bullishness as it was able to open higher on the first trading day last week. This bullishness was further supported by the 4 other actions by the index. First is the gap up that happened on Thursday, which led to the second action which is the breaking of resistance line established from the recent downward trend. The third is the closing of the gap from the first week of November and fourth is the MACD crossing above the signal line. The breakout from the resistance line is just a confirmation of the recent upward move, however it is still not a breakout from an area pattern as we do not have a valid area pattern for now. For the coming week, we may see the index consolidate in a sideward movement and may also re-test the resistance-turned-support line. The sideways consolidation is what is best for the index as it has now recovered 60% of the recent downward move from October and it still has not consolidated. Any further upward move might place the index in levels where the bulls might not be able to support.

COL (Chart: Daily Resistance: 14.50 Support: 10.50)

This stock was featured by Bonner at the Absolute Traders website. It has formed a symmetrical triangle with resistance at 14.50. Possible upside target price of 22. For those doing range trading, you can buy at 12.50, sell at 14.50, cutloss at 11.75. As of current the stock is now bullish as it has gone past the 65 day MA and MACD is now above the signal line. Average volume is around 1M, a good break out volume should be above 4M

BPC (Chart: Daily Resistance: 4.65/4.85 Support: 4.35)

BPC seems to have broken out of a symmetrical triangle formation, however I am not quite sure about the volume on breakout. It was accompanied by large volume, but I am not sure whether it is sufficient. The stock is currently re-testing the support line. What we need to see is for the volume to pickup for the coming days. Also what is noticeable in the chart is a head and shoulder formation that did not push thru. However it cannot be considered as a failed head and shoulder as it did not break down, so it is currently more of a symmetrical triangle. Target price for the triangle is around 7. MACD is bullish, but RSI is near overbought, so there might be some further re-testing of support for the coming days.

MIC (Chart: Daily Resistance: 7.50 Support: 6.80/ 5.60)

MIC is also a candidate for a symmetrical triangle. Breakout point is 7.50 Target price is 15. MACD is currently bullish and RSI is just halfway from being oversold. Average volume is around 4M, a good breakout volume is around 20M shares.

In Retrospect: SMC, JFC

SMC

SMC had tough time last week. The bears were successful last week of preventing the price from moving further as trading was always closing lower than the opening price. During the bearish trading last week, it was somehow able to form a support at 50. However, a resistance was also formed at 51.50. So we could say that it is currently consolidating and moving side ways. Checking on the indicators, the MACD has crossed above the signal line, which is bullish. The RSI on the other hand still looks good as it is still below the centerline of 50, which means the recent bearish week is not yet the end for this stock and that it is just taking a breather from the recent upward move.

JFC

JFC had a very bullish start last week with the stock opening higher than its previous week’s close, reaching 52 before closing at 51.50. The rest of the week was characterized by bearish action topping with a sign of indecision on the last day as price opened and closed on the same level. The stock may further consolidate next week, as it is currently in between the 65 and 130 day MA. Sideways consolidation is actually good for the stock at this point as a breather from the recent upward move. Still watch out for the possible inverse head and shoulder formation with resistance at 54.

StockWatch (Dec 03-07, 2007): PSEi, SMC, JFC

PSEi (Chart :Daily Resistance: 3620/3670/3730 Support: 3500)

The index had a very bullish action last week and recovered 30% of the recent downward move. There was an unusually large volume traded last Tuesday and we can probably consider this as a support. One good thing that can be observed in the chart is that the gap up that happened on the first trading day last week created an island reversal, now how high can the index go is still anybody’s guess. Last week also, the incident at the Manila Peninsula did not have much of a negative effect on the index, but it somehow has shown a little bit of indecision on where it will move next as it closed just below the opening level creating a doji. The doji that formed I think definitely reflected the current situation for the index. We have the recently formed island reversal and a 20% recovery from the downward move which are bullish actions, however, due to last Thursday’s incident at Makati, there definitely occurred some hesitations and bearish reactions that prevented the index from closing higher, thus forming a doji. This coming Monday’s trading would be a critical indication of how the market will turnout for the rest of the week. There might be some selling happening when the index opens and that might be associated with the uncertainty and cautious trading. But observe the index closely, if the sentiment is still bullish, the index can immediately pull up from the selling pressure, or probably immediately open higher. Now looking at the DJIA last week, it formed a stalled candle stick pattern (3 successive white candle with the first 2 candle sticks being long and the 3rd a small bodied candle stick) and last Friday's trading had a higher close, but it formed a black candle with large volume, so there might be some bearish sentiment that could affect our local market for the coming week. Watch out for support at 3500, breaking this level might be an indication of a return to downward move. An MACD cross above the signal line is also poised to happen, if it does, then it is a bullish confirmation of the recent upward move that we are experiencing.

Erratum: I earlier posted a wrong info on the DJIA having gained 300pts, it actually gained only around 60 pts last Friday, forming a black candle.

SMC Daily Chart

SMC Weekly Chart

SMC (Resistance: 51.50/54/56.50 Support: 46.50/42.50)

SMC now has an island reversal formed with an exceptionally large volume as shown in the daily chart. Looking at the weekly chart we can see that it fell short of being a bullish engulfing formation, however, the volume says a lot about the bullishness of this stock as it had an exceptionally large volume for last week. On the daily chart we can also see the bullishness as the stock was sold down with low volume, but was bought up the next day with more than double volume when it was sold down. Another bullish indicator is the MACD which is now poised to cross above the signal line. There is no price target for this since we do not have an area pattern formed. The only guide we have for selling are the different resistance levels and also our risk-to-reward ratio. The upcoming resistance for this stock are a.) 51.50, the highest the stock went last week, b.) 54 which is a long standing support that turned resistance when the stock broke down last November, and c.) 56.50, the 38.2% Fib retracement. Watchout for the 54-56.50 levels, those that were able to buy at 45 and below may start cashing in on the stock at those levels. Average volume for this stock is around 300T shares traded, a sell down near or above the average volume may indicate that some have started cashing in on the stock. If the stock was able to go past the 54-56.50 levels with low volume on sell downs, then there is a higher chance that the stock may reach the 65 level which is the 61.8% Fib retracement.

JFC (Chart: Daily Resistance: 51/55 Support: 48.50/45)

JFC showed a bullish movement last Thursday when it closed the gap formed last Nov 20 accompanied with a large volume of about 2.9M shares. The MACD has currently crossed above the signal line indicating a buy. The only hesitation that I have with the stock is that it formed a large upper shadow, which indicated that there was not enough bullish sentiment that could hold the stock at those price levels. However even though it was not able to hold price at those levels, it was able to close the gap formed last Nov 20 which can also be interpreted as a bullish move. We need to watch the succeeding trading days though. Watch out for signs of diminishing bullishness such as high volume on selling days and being unable to close above the 260 day MA. Also watch out for the inverse head and shoulder formation and possible resistance at 54-55 levels.

In Retrospect: GLO

GLO

The support at 1390 was able to hold for GLO, after which the price gapped up on the first trading day. Price went up to as high as 1560 before closing at 1520 last Friday. The gap up formed an island reversal, however a word of caution though, the upward movements were accompanied with below average volume. Watchout for resistance at 1570 (Fib 50%), 1610 (Fib 61.8%). I expect further resistance in between 1610 -1700 levels as those price levels are areas where the price consolidated before moving down. Even with the recent upward movement MACD is still below the centerline and also below signal line, so playing with this stock should be a hit and run approach.

StockWatch (Nov 26-30, 2007): PSEi, GLO

PSEi (Chart: Daily Resistance: 3505 Support: 3455/3290)

The index suffered 3 straight selling days last week with the index breaking the support at 3520 even gapping down to its lowest at 3455. Last Friday the index was up, as well as the DJIA. A couple of things to observe for the coming week: 1.) The broken support from the previous gap up, might be re-tested as a resistance. If the resistance fails to hold, and breaks above it, we need to see the succeeding days trade above that line. 2.) Observe also the gaps formed. As of current there have been 3 uncovered gaps formed. Assuming that the recent gap does not get covered, this also means the resistance was able to hold the line, this translates to further downward move. The only good side of this is that the recent uncovered gap might indicate a possible upcoming bottom to the downward movement. 3.) RSI is now nearly oversold. This re-enforces the possibility of an upcoming bottom. 4.) Assuming that the recent gap was covered, but the resistance line was able to hold the index from trading above and beyond it, we can use the 2nd gap as a measurement of how low the index will move further. Measuring the distance of the 2nd gap from the top, this translates to a further downward move to near 3300 (also the 260 day MA acting as support) as the lowest that the index could possibly go. As of now, the sentiment is still bearish so keep track of your exit points.

GLO (Chart: Daily Resistance: 1450 Support: 1390/1360)

GLO may encounter a temporary breather from the downward movement. As of current, there have been 3 gaps that formed with the exhaustion gap being confirmed by the RSI marking an oversold for this stock. Last Friday the stock was bought up, however, there was not much volume on the buy up, so we might see further downward movement down to 1360. The 360day MA is acting as support at that level. This is a possible candidate for range trading. Buy at 1360, sell at 1450, cutloss at 1355. Note that we are just taking advantage of the possible bounce from support, so trading this stock should be done as quickly as possible. The gaps don’t guarantee a reversal from the current downtrend, unless an island reversal is formed. The gaps just suggest a possible upcoming bottom. But what can also happen is that the stock may rally for a short time from that possible bottom and continue moving downwards, considering that there is still no clear signal of reversal

In Retrospect: MA

MA

The bullishness of MA did not push thru. On the first trading day, it was sold down, and on the succeeding days it went a low as 0.25. This definitely invalidated the breakout as the price went back in and below the triangle formation. The bullishness of the MACD has now transformed into a bearish signal, with the looming action of a cross below center line

StockWatch (Nov 19-23, 2007): MA

MA ( Chart: Daily Resistance: 0.032/ 0.036/0.038 Support: 0.029/0.030)

MA seems to have broken out of either an ascending triangle with 0.30 as resistance or a symmetrical triangle with 0.029 as resistance. Target price of either formation would be above 0.040. Volume on breakout is about 3B shares, volume on the last trading day was 1B. If on Monday the stock was bought up with volume of above 1B, this would be a confirmation of continued bullishness. As of current, MACD is indicating a bullish signal as it is above the signal line and at the same time above the center line.

In Retrospect: LCB, APXB, PEP, JFC

LCB

LCB has proven its bullishness. It was able to move past 0.50 resistance level and continued up to as high as 0.60. MACD also followed as well with the movement of the price. This stock is now over bought and may move down to sideways for the coming week. If we consider the downward channel where it broke out from, the target price is near 0.65. It is possible that a flag/pennant may form for the coming week.

APXB

APXB was not able to move up at par with LCB’s bullishness. Currently the MACD is in the position of forming a bearish divergence, but this is still not final. Any further downward move will definitely seal the bearish divergence. However, looking at the recent trading days, the upward move by this stock has volume, though it may not be as large as the breakout volume, but this is definitely a bullish sign. So I’m more inclined to see the MACD forming a higher high. Considering the downward channel it brokeout from, the target price of the stock is near 8.50.

PEP

PEP went as low as 0.78 and made a large bounce reaching the target price of 1.10 within one day. Watchout for a flag to form. There may still be some play left for this stock considering that there was only 1 day where there was a sell down. But this is left to be proven by next week. If the stock is bought up with volume of around above 10M, there is still momentum for this stock. If the stock is sold down below 0.90 with high volume, then this means the play is over.

JFC

JFC went to as low as 44.50 and went to as high as 50. As of current there is strong resistance at 50. The downward trend for this stock is still intact. Movement for this week may either be up to sideward. There is still resistance at 55. Watch out for the possible formation and break out of an inverted H&S.

StockWatch (Nov 12-16, 2007): PSEi, LCB, APXB, PEP, JFC

PSEi (Chart: Daily Resistance: 3800 Support: 3650/3620/3520)

The index suffered another plunge last Thursday following after the Dow 200 points plunge. As of last Friday Dow took yet another 200 pts plunge after other financial institutions have also started to announce their losses from the Subprime crisis. This recent plunge will definitely be felt this week in our index. As of current we are seeing a bearish divergence forming with the RSI, however, this is still not confirmed as the trough has not yet formed. The symmetrical triangle I have noted before is still intact after the plunge last Thursday and I expect that this will be broken come Monday. Next support levels are 3650 (23.6% Fib retracement), 3620 (previous low) and 3520 (previous low of the gap up last Sept and at the same time, the 38.2% fib retracement). Aside from the above mentioned support levels, another thing to watch out is the MACD crossing below the center line. If this happens, then we may see further downward movement.

LCB(Chart: Daily Resistance: 0.50 Support: 0.42)

LC and LCB surprisingly gapped up with a big upward spread and were accompanied by large volume. This gap up has broken LC/LCB’s long standing downward trend. However, there is something that is not so good on this breakout, for LCB, the wicker of the candle for the breakout day was larger than the body, while for LC, the price opened and closed on the same level. This means there is still strong resistance along the way up. What may probably be good to know is that even if there is strong resistance along the way, there was a large volume on the breakout which may translate to a very strong support level. For LCB, there is still an upcoming resistance at 0.50 which is the previous high from 2005. A thing to watch out though is the MACD, this stock has now formed a higher high, and the MACD needs to follow. If this does not happen, then this is a warning sign for an upcoming bearish action.

APXB (Chart: Daily Resistance: 7 Support: 6.30)

APX/APXB has a similar situation with LC/LCB. The recent breakout from the longstanding resistance line was accompanied with volume. Price formed a higher high and MACD needs to follow. If MACD is not able to form a higher high, then this might be a bearish indicator. For both APX/APXB and LC/LCB, considering the plunge in Dow last Friday, it is highly likely that these stocks would be sold down and if it does, a bearish divergence may form.

PEP (Chart: Daily Resistance: 0.94 /0.98 Support: 0.75/0.72)

This one I think was pointed out in the Absolute Trader’s forum by Yeahbah. PEP brokeout from the inverted head and shoulder formation with a large volume and spread. Target is around 1.10. This is currently doing a return move to re-test the resistance turned support at 0.75. It’s a wait-and-see what will happen by next week considering the recent events in the US market. If price bounces from support, this would be a good time to buy.

JFC (Chart: Daily Resistance: 51 Support: 47)

JFC is a candidate for range trading. Price level at 47 is a support level and may expect a bounce from that level as RSI below 30 is very much oversold right now. Entry at 47, sell at 50, cutloss at 46.50.

In Retrospect: DMC, AJO

DMC

DMC still hasn’t reached the target price of P13. Price was stopped at P12 and opened lower on the first trading day. What I think was positive for this stock was that during the days that it was sold down, volume was low. This might be an indicator that a lot are still bullish with this stock and are still holding on to it. On the last trading day, the stock opened and closed on the same price level, so this means anything can still happen by next week. As of current, resistance is still at P12 and there maybe support at price levels 10.75-11.25. This may consolidate for a while, but considering the position of the 65 day MA and the 130 day MA, this looks like it is poised for a cross over and continue the upward move. The crossover may be used as a buy signal.

AJO

AJO was also stopped from achieving the target price of 0.21. Bullishness is still with the stock because even if there was large volume on the sell down on Wed, there was just as must trades on the day after where the stock was bought up. However, this stock will still further consolidate and the condition may still shift. As of current support is at 0.15. The 65 day MA crossover with 130 day MA can be used as a buy signal.

Absolute Trader's November CAF (Chart Analysis Forum)

Absolute Traders will be having its November CAF on Tuesday Nov 6, 2007 at MetroWalk Ortigas. Visit the AT website for further info.

http://www.absolutetraders.com/

StockWatch (Nov 05-09, 2007): PSEi, DMC, AJO

PSEi (Chart: Daily Resistance: 3800 Support: 3680)

The index gapped down on the first trading day after the Glorietta 2 blast. The previous falling wedge that I was expecting to form was invalidated by the gap down. Currently the index was able to cope with the gap down and has now covered the gap that was made. The gap down that happened seem to have made a symmetrical triangle formation with the index. Index at 3,800 is currently the resistance and support at 3680. Upside target for the symmetrical triangle is at 4100, the downside is at 3380. There is still a high possibility that we may have to redraw the triangle or it may also be invalidated. It's still a wait and see for our index considering that the Dow has recently suffered another 200 points down last week. Plotting the Bollinger Band on the chart, it looks like a move will occur anytime soon as the bands are constricting

DMC( Chart: Daily Resistance: 12 Support 10.75/10.25)

DMC broke out of the ascending triangle during the 2 trading days last week. Target price for the ascending triangle is at P13. At the current price level of 12, it is already very risky to get in. There may be profit taking next week as some may lock in their profits at P12

AJO (Chart: Daily Resistance: 0.15/0.17 Support: 0.13/0.12)

AJO broke out of a symmetrical triangle. Upside target of 0.21. Resistance at 0.15 and 0.17 which are the previous highs. Support at 0.13. Sell when it goes to 0.12. This means weakness in the breakout if it moves to 0.12

In Retrospect: TA, SMCB, GEO, PX, MEG

TA

Target price for TA is reached and has gone beyond up to 2.30 establishing a new high. There is profit taking as of the moment, but price may still move up once profit taking is over. Profit taking may push the price down to 1.80 level, the 38.2% fib retracement.

SMCB

SMCB moved lower and formed a double bottom at 59.50. It invalidated the earlier triangle that I saw. It seems now that 59.50 is a strong support now. Resistance is still at 66 and the bullish divergence is still intact. The double bottom I think is another confirmation that the downward trend is reversing. We have to look at the upcoming resistance at 66, if it is a strong resistance and produces a lower high for the price and a higher high for the MACD and RSI, this is another confirmation of the trend reversal.

GEO

GEO was one of the stocks that was definitely affected by the Glorietta 2 blast creating a gap down on the first trading day after the blast. It has now covered the gap made. This rally would be a good time to sell as there is still no clear bullish indication to contradict the bearish divergence that was seen last week. Price may still move to as high as 2.90 or beyond, however watch for MACD and RSI forming a lower high.

PX

PX formed a higher high for the price, but the RSI and MACD has yet to register a higher high. RSI’s bearish divergence is still intact and now we watch for the MACD if it would follow to exhibit a bearish divergence.

MEG

Bearish divergence on the RSI is still intact. It’s still a wait and see if other indicators will confirm the bearish divergence.

Off Topic: Life is too short....

Life is too short..... as the popular adage goes. And last Friday's bombing at Glorieta 2 proved that life is really too short.


I knew 2 of the casualties of the bombing, a former officemate of mine and the wife of my friend from college.


My former officemate and his friends was there just for the usual Friday's lunch out. My friend came from G4, just had his lunch and he was just a curve away from meeting his wife at Glorietta 2. And it was probably all just a matter of seconds between life and death.


Probably if my former officemate had not stopped for the book sale, he might still be alive today. Probably if my friend's wife was able to take a few steps to make the turn, she might have been spared by the blast. Probably, had I forgotten that I have a 1:30PM meeting, I might have also gone to Glorieta 2 for the book sale. Probably, if the night guard at Glorieta 2 took a decision for a double shift, he might have been the one standing on the top of the blast creater.


All just a matter of seconds between life and death. And it makes you think of the reason or purpose for such tragic or fortunate incident to happen.


The only thing I could resolve is that probably it happened for the reason that we be reminded that we should value our life, value those people that we love, value the everyday blessings given to us by God.


So after a losing trade or after a happy meal you've earned from trading, after a day's work, or after a burp from the meal you've had....at the end of the day say a prayer of thanks, go home to your family hug each one of them and say you love them.


Life is too short to forget these important things in our life.

StockWatch (Oct 22-26, 2007): PSEi, TA, SMCB, GEO, PX, MEG

PSEi (Chart: Daily Resistance: 3835/3863/3896 Support: 3750/3600)

Cautious trading may prevail next week as a reaction to the Glorietta 2 bombing. I think that those spooked by the tragic terroristic act will sell immediately on Monday. However, even if the bombing did not happen, our market is really on its way down for the short term. As seen in the chart, after breaking the previous high, the index was not able to sustain its position above the support line. It eventually moved below the support line and even lower. As of current, the MACD has crossed below the signal line, triggering a sell for the short term. A good picture though that is currently forming in the chart is a falling wedge. Given the recent bullishness from the index’s lowest last August, to its highest this October, it is highly likely that current downward move we are experiencing is a prelude to the formation of the falling wedge. A falling wedge indicates short term bearishness and once it breaks above the resistance line, further bullish sentiment is expected. The target level of the falling wedge is around 3900.

TA (Chart: Daily Resistance: 1.52 Support:1.34 )

TA gapped up on Friday with a large volume. Conservative target price of the breakout is at 1.80.

SMCB( Chart: Daily Resistance: 66 Support: 61)

SMCB is exhibiting a bullish divergence. Both MACD and RSI registered a higher high, but the price registered lower highs. Also, it seems that it is forming a symmetrical triangle as of current with 61 as support and 66 as resistance/break out level. The target price for the symmetrical triangle is at 74. This stock may encounter further resistance from the 3 MA’s at the levels of 69-72.

GEO(Chart: Daily Resistance: 2.90 Support: 2.48)

GEO is exhibiting signs of bearish divergence. Both RSI and MACD registered a lower high, but the price still registered a higher high. Sell.

PX (Chart:Daily Resistance: 9.70 Support: 9.50/8.90)

PX is also exhibiting bearish divergence of RSI against price. Price formed a higher high, but RSI formed lower high. Sell.

MEG (Chart: Daily Resistance: 4.60 Support: 4.25/3.85)

MEG will probably exhibit a bearish divergence between RSI and Price. As of current, the peak of the RSI is not yet formed, but considering the price has already gone higher, RSI still has not registered a higher high. We are just waiting for confirmation of the RSI peak forming a lower high. It would be best to sell on rally.

In Retrospect: MIC, PLTL, MPI, WEB

MIC

MIC has had a hard time breaking above the 8.70 resistance level. It was able to do so once, but price fell back in consolidation for the same day. On the other hand even if it was not able to maintain a position above 8.70, price was able to maintain the support on 7.80 level. As of current, MIC is consolidating in a small sidewards channel between 7.80 and 8.70. If price continues to move below 7.80, it would be best to sell considering it has consolidated for 2 weeks and a move towards 7.80 means a stale mate has been broken between the bulls and the bears and definitely the bears win if price goes below 7.80. Next support at 7.70/7.10/6.10.

PLTL

PLTL’s price has consistently closed at or above 8.00 the previous week. It was an unexpected move for PLTL to break the support at around 7.80, bringing the price down to 7.40. It fell 10 cents short of reaching the downward target of 7.30. This is one of the rare occasions that an ascending triangle breaks down. If price would still rally by Monday, this would be a good time to sell, considering that MACD just turned bearish.

MPI

The flag/pennant formation for MPI did not materialize. Instead a spike happened on the second trading day, opening at 5.30, achieving a high of 5.80, before closing again at 5.30. Currently it has found support at 5.00, but price may still move further down or sideways movement for the coming week.

WEB

WEB is dangerously moving near the apex of the symmetrical triangle. A breakout or breakdown may happen soon. Otherwise we have to redraw our charts. As of current the 130 day MA is providing support at 0.0525. I’m more to expect a breakdown from this stock because of the following bearish indicators: 1.) the 65 day MA moving below 130 day MA, 2.) MACD crossing below the signal line. 3.) RSI has consistently stayed near oversold level. The next support levels are 0.0525/0.048/0.042

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StockWatch (Oct 15-19, 2007): MIC, PLTL, MPI, WEB

MIC (Chart: Daily Resistance: 9.20/ 10.00/ 11.50 Support: 7.80/6.50)

MIC gapped up with volume on the first trading day. Target price of P13.00 is not yet reached. Price is currently near 8.10. MIC has currently developed into a flag/pennant formation with a target price of 11.50. Support is currently at 7.80, resistance at 9.20 and 10.00.

PLTL (Chart: Daily Resistance: 8.10 Support: 7.60)

PLTL also gapped up with volume on the first trading day. Currently it is consolidating inside a small ascending triangle with a target price of around 8.60. The target price of P9.00 for the ascending triangle where it broke out from (at 7.30) is still not achieved. Getting in at this point is a little bit risky as price is in its halfway point.

MPI(Chart: Daily Resistance: 5.30/5.50/5.80 Support: 4.60/4.20)

Large volume for MPI for the last 2 trading days. This is a candidate for a flag/pennant formation.

WEB (Chart: Daily Resistance: 0.060 Support: 0.055)

WEB is currently in a symmetrical triangle. For the short term, it is consolidating inside an ascending triangle with resistance at 0.060. If it breaks out of the ascending triangle, target price is at 0.075. A breakout from the symmetrical triangle would have a conservative target price of 0.085.

In Retrospect: PAX, TUNA

PAX

PAX moved further down to 10.25 confirming the breakdown from the symmetrical triangle. As of current target price of P9.00 is not yet achieved. The move down has created a downward channel. The bullish divergence is still intact as of the moment, but price may still move further down dragging the RSI and MACD

TUNA

The price for TUNA is currently trapped in between the 65 and 130 day MA. There is still a possibility for a flag/pennant breakout for TUNA with a target price of around 2.25
Support is at 2.00

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StockWatch (Oct 8-12, 2007): PSEi, PAX, TUNA, MIC

PSEi (Chart: Daily Resistance: 3820 Support: 3600)

..and the Bulls are back! Of the 2 resistance I pointed out last week, we have successfully surpassed one of it, which is the gap down last July and with good increasing volume! As of current we are just a few points away from creating a new high. If the previous high is taken out, that would be the official opening of the bull season, so get ready to ride the bull! Thing to watch out though is the RSI, which is now overbought. Any downward move is welcome as long as the index does not go below 3600.

PAX(Chart: Daily Resistance: 13.50 Support: 11.25)

We have a mixed pattern for PAX. A symmetrical triangle and a falling wedge. The symmetrical triangle broke down with a target price of 9.00. However the breakdown has formed a lower low creating a falling wedge with a target price of 16.50. At this point either of the 2 patterns is a possibility. If by next week price moves above 12.25, the falling wedge is confirmed, otherwise if price moves below 11.25 the symmetrical triangle is confirmed. As of the moment, the chart is exhibiting a bullish divergence with price forming a lower low and MACD and RSI forming a higher low. However, again, this is still not confirmed, if price moves lower, MACD and RSI may follow invalidating the current divergence we are seeing.

TUNA(Chart: Daily Resistance: 2.10/2.60 Support: 1.86)

TUNA brokeout from a small symmetrical triangle and target price was immediately achieveh. However, this can still be a candidate for a flag/pennant formation. We now have the flagpole formation. It is possible that further extension to the pole may form next week.

MIC (Chart: Daily Resistance: 8.10/9.20/11.50 Support: 6.10)

MIC brokeout from a symmetrical triangle. Target price is at 13.00. Upcoming resistance at 8.10 which is the 61.8% Fib retracement and 9.20, the previous high.


General Analysis: A lot of issues already brokeout from a triangle formation or a breakout from a trend with sufficient volume.. Watch out for the following. PA, MBT, PLTL, FDC, WEB

In Retrospect: PLTL, ISM

PLTL

PLTL broke resistance at 7.10 but without volume. However it was able to sustain its upward move toward 7.30 and eventually also broke out from 7.30 with considerable volume. The last 3 trading days were characterized by above average volume. RSI is now oversold and there is a possibility that 7.30 support (previously resistance) will be re-tested.

ISM

I’m unsure of how ISM will fair in terms of the flag/pennant formation. Usually in the local market flag/pennant formation has a duration of 3 days for it to form. For ISM it has already taken 5 days for the formation and still no breakout. Watch out for support at 0.042, price going below that would be a signal to sell.

StockWatch (Oct 01-10, 2007): PSEi, PLTL, ISM

PSEi (Chart: Daily Resistance: 3600-3700 Support: 3520)

We now have further confirmation of the upward move. The 65 day MA and 61.8% Fib retracement were easily taken out by a gap up with considerable volume. As of current the index is now overbought, expect side to downward movement in the index for the coming days. MACD may test the center line as support, if it is able to stay above the centerline despite the downward move this is another sign of strength for our index. We now have only 2 remaining resistance along the way to establishing a new high: the gap down and previous high formed last July. Let’s get ready to rumble!

PLTL (Chart: Daily Resistance: 7.10/7.30 Support: 6.90)

PLTL is displaying the characteristics of an ascending triangle. Two resistance points can be noted, first is at 7.10, second at 7.30. If it breaks out of 7.10, target price is around 8.70, if it breaks out of 7.30 target price is 8.90. A good breakout volume would be above 15M shares traded

ISM (Chart: Daily Resistance: 0.055 Support: 0.046)

ISM is a candidate for a flag/pennant formation. Watch out for the pennant/flag for the coming week. Conservative target price of atleast 0.07 based on the current pole.


General note: There are a lot of other stocks exhibiting ascending triangle characteristics (e.g SM, SMPH, SMDC). If the coming week will be a down to sideward move, this might be a good chance to get in those stocks, however do observe your cutloss levels if incase price moves further down.

In Retrospect: Mining, WIN, SMPH, BSC

Mining

Mining was very bullish, so bullish that it has already formed a new high. Watch out for a possible side to downward movement soon as RSI is now overbought. It is also possible that the side to downward movement may form a falling wedge, a confirmation of the bullishness.

WIN

The bulls and the bears are in a constant battle for the past week as most of the trading days last week were marked by the same opening and closing price. There is a little bit of upward movement in the price, but it never was able to move above the 65 day MA. There is also another resistance coinciding with the 65 day MA, this was the gap down formed last August which might also be contributing to the slow upward movement of price. On the bright side MACD has now crossed above the center line which is a sign of bullishness. However RSI is now near overbought level. For the days to come, the MACD may retest the center line. To confirm its bullishness, the MACD needs to stay above the center line and volume should be light on down days. The big symmetrical triangle that I earlier pointed out is invalid because the volume on the breakout of the smaller symmetrical triangle has broken the diminishing volume characteristics of a symmetrical triangle.


SMPH

SMPH went as high as 12, but there never was sufficient volume on the breakout. The symmetrical triangle now needs to be redrawn. Watch out for the upcoming resistance at 12.25. There is a possibility that it may form an ascending triangle.

BSC

BSC was unable to move above the 65 and 130 day MA. It went only to as high as 0.39 and moved to as low as 0.34 for the week. The good thing about its downward move was that it was going down with light volume. For the coming days, price may move side to down ward and MACD may try to test the centerline. As of current, BSC is lacking in bullish signals. First it was unable to move above the 2 MA’s, second, RSI went above the 50 level, but was unable to stay above it. In addition, if MACD is unable to move above the center line and subsequently crosses below the signal line, then this definitely is not a good sign.

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StockWatch (Sept 24-28, 2007): PSEi, Mining, WIN, SMPH, BSC

PSEi (Chart: Daily Resistance: 3460/3580 Support: 3280)

The index is near the 61.8% Fib retracement at 3460 acting as resistance which is also the 65 day MA. The strength of the bulls will be tested at that resistance level. Now in order for the bulls to win there has to be an increase in buying sentiment. However, on plotting the slope of the On Balance Volume line, it seems that there is only mild buying compared to the intense selling that happened on the downward trend. Probably a lot are still waiting for more signals to confirm the bullishness of the upward move. As of current we already have one bullish signal which is the MACD crossing above the center line. If the index is able to move above the 61.8% fib retracement, this can also be another bullish signal. Also another upcoming resistance would be the lower end of the gap formed last July at 3580. With these upcoming resistance levels and mild buying sentiment on the upward move, it would be best to keep watch of your stops. It’s definitely a wait and see if the resistance will be easily taken out by the bulls.

Mining (Chart: Daily Resistance: 7040 Support: 6370)

Mining sector is very bullish with MACD crossing above center line. The slope of the upward move is very steep accompanied by increasing volume. However, as clearly seen in the chart, the mining sector needs to take a breather. It cannot sustain a very steep slope forever and looking at the RSI, it seems that the breather will happen anytime soon.

WIN (Chart: Daily Resistance: 0.39/0.46 Support: 0.33)

WIN has broken out of a small symmetrical triangle. Target price is 0.50. If the target price is reached, with high volume, this means a break out of the outer symmetrical triangle with a TP of 1.00, but this is still far away and still needs to be confirmed by a good breakout volume.

SMPH (Chart: Daily Resistance: 11.50 Support: 10.25)

SMPH is forming a symmetrical triangle. Breakout above 11.50 needs to have a good volume. Target price is 15.00.

BSC (Chart: Daily Resistance: 0.38/0.40/0.46 Support: 0.30)

BSC showed signs of positive divergence. RSI and MACD logged a higher low, while price logged a lower low. Trading last Friday has an increase in volume. There is no area pattern, so our basis for selling is only the Fib retracement at 0.40 (38.2%) and 0.46 (61.8%).

In Retrospect: BPC

BPC

BPC broke out of the inverse head and shoulder formation. However, the breakout volume in my opinion was not large enough. The upward move without a large volume means there is a lack of buying sentiment. There would come a point when those who are bullish with this stock become depleted and there will be no one else to buy this stock and of course, will naturally cease from moving further up.

On further analysis of the inverse head and shoulder, I think I may have made a mistake in the interpretation of the right shoulder. Inverse head and shoulder should have light volume on the right shoulder’s decline, but the chart indicates that there was increase in volume in the right shoulder formation. This became obvious to me after overlaying the OBV chart against the price.

At point 1 to point 2, we could see the formation of the head and volume is increasing as evidenced by the upward movement in the OBV line. What went wrong with the inverse head and shoulder is that the decline towards the formation of the right shoulder should happen with a lighter volume; however as what can be seen in the OBV line is that it went lower than the point where the head was, which indicates further intense selling during the formation of the right shoulder. This I think invalidated the inverse head and shoulder formation which is currently confirmed by the low breakout volume.

These are the things to watch out on the succeeding days: 1) Watch out for the price level 4.20-4.30 acting as resistance, this is the 38.2% Fib retracement and also the 130 day MA. 2.) Watch out also for previous resistance line (at 3.70-3.80) which is now the support line. Because there is a lack of volume on breakout, the price may re-test that line and if there really is no further buying sentiment, the price may eventually break below that line. 3.) If price moves below that support line, watch out for the previous low of 3.25 as the next major support line.

StockWatch (Sept 17-21, 2007): BPC

BPC (Chart: Daily Resistance: 3.85/ 4.20/ 4.85 Support: 3.25)

BPC displayed a divergence of RSI movement against price. Price has formed a lower low and RSI formed a higher low. The MACD is also showing a slight divergence. There is also an inverse head and shoulders formation in the charts of BPC and the volume is confirming the formation. A significant characteristic of an inverse h&s is that volume tends to diminish from the left shoulder to the head. And volume has to increase during rally after the formation of the head. These characteristics are noticeable in the BPC chart which strongly confirms the formation. The break out price level would be around 3.80-390. The critical part for this formation to be valid is that the volume on breakout should be large. Coming from the bottom, it needs to have momentum for it to be able to propel itself to the target price of around 5.0. If the breakout does happen, expect that the support line (former resistance line) will be tested.