StockWatch (June 30-Jul 4, 2008): PSEi

PSEi (Chart: Daily Resistance:2543/2650/ Support: 2458/2430/2300)

The index plunged further down on the first trading day of last week. The index went to as low as 2458 last week, breaking the previous low support at 2510. But although the previous low was broken, the support line extending from Jan 2008 has yet to be broken by the index. This is now the fourth instance where the Jan 2008 support line was tested, and with that, we can say that this is a very strong support line. However, last Friday’s trading further tested the support line for the 5th time. I’d like to assume that it would be able to contain the downward movement as it was able to prevent the index from moving further downward for 4 times already. But Friday’s gap down, accompanied by a large volume on the chart, made me think twice as to whether the support line will still be able to hold the index. The support line has a good track record, but the gap down with volume is hard to dismiss, so it’s really anyone’s guess if the support line will hold come Monday

Stock Watch (June 23- 27, 2008): PSEi, BPC

PSEi (Chart: Daily Resistance: 2650/2710 Support: 2510/2300)

The index is still trading in a downward channel and still no signs of reversal. As of current, the index is unable to move past the previous support-turned-resistance line from 2003. Trading strategy would be to remain on the sidelines for now.


BPC (Chart: Daily Resistance: 1.46/2.85 Support: 0.80)

BPC has been on a nose dive since the start of the year. It has been on a very bearish move as it lost more than half of its value within a month. Based from the charts, it can be noted that BPC’s downward move can be attributed to the break down from a head and shoulder formation or probably a break down from a symmetrical triangle formation. Either way, the target price of the break down is at 0.80. This is just an approximation of how low it can go, but it may move lower. This is definitely a stock to be avoided for now. Judging from the consecutive sell down of this stock for the past 4 weeks, I can say that a rally may be seen in the coming days, as the RSI is currently very much oversold.

StockWatch (June 16-20, 2008): PSEi, PCOR

PSEi Weekly Chart

PSEi (Chart: Daily Resistance: 2900 Support: 2510/ 2300/2034)

In an unexpected turn of events, with the successive oil price hikes, the index buckled from the bearish pressure and plunged 200 points in just 4 days. I initially thought that the index was starting to move sideways and consolidate, but the events last week proved that the market is still bearish territory. The plunge broke a very important trend line, which is the support line from 2003. Breaking this support line is definitely bad news, as it means the hopes of continuing the upward movement became less. As of current, the index has continued trending downward, trading within a small channel. The low of the index last week at 2510 could probably be a support level as it is the support line of the downward channel. If the index still breaks this support, it’s anyone’s guess for the next support level. One probable support is at 2300, which is the Weekly chart’s 260-MA, next one is the next previous low at 2034. A rally is possible this week as the RSI is at its lowest. If you have been range trading, this would be a good chance to get out if you were stuck from the plunge. There is still no reversal pattern in the charts, so the current trend is expected to continue.

PCOR (Chart :Daily Resistance: 6.50 Support: 5.80)

Let’s take a look at PCOR’s activity in the light of the recent successive price increases. Looking at PCOR’s chart, we can see that it is positively reacting to the recent events. Just as when the index moved lower, PCOR moved higher, even creating gaps on the price. As of current, we now have a run-away gap from last trading day’s activity. Another gap up is not impossible as there may still be room for this judging from the upward channel’s resistance line. It is recommended that any gains from the recent gap ups should be protected as it is highly likely that the top of this rally may be formed this coming week because RSI is near overbought. This chart is still consolidating as seen from the intertwining of the 3 MA lines, so trading strategy would be to range trade this stock. Resistance is currently at 6.50 which is a previous high.

StockWatch (June 9-13, 2008): PSEi

PSEi (Chart: Daily Resistance: 2900 Support: 2712)

The index moved further downwards to the low of 2717. It is possible that support may be available at this level, since the previous low was at 2712. If this becomes a trough, it is interesting to note that the RSI and MACD is still creating higher lows. By the MACD alone, we could infer that there is accumulation going on at this stage as the MACD has lately been creating higher lows. The MACD is still consolidating near the zero line, but this might oscillate more before moving beyond the zero line. Since it seems that we are in a consolidation phase, trading strategy would be to trade the range. It is still too early for this stage, but do watch out for reversal patterns like double/triple bottoms, of inverse head and shoulders, it is during consolidation that these area patterns begins to form. As of current we can see a lot of candidates for double bottoms, but it is still too early and these area patterns might evolve into another pattern later on.

StockWatch (June 2-6, 2008): PSEi

PSEi (Chart: Daily Resistance: 2900 Support: 2760)

There was not much action in the index last week. The previous gap down was covered on the third day of trading last week and thus invalidating the gap. Looking at the volume last week, there was significant volume on the last day of trading. This may suggest a continuation of the buying action by the first day of trading this week. In my opinion, I think the index is now slowly moving into consolidation phase and may trade any where between 2700 to 3000 for the succeeding weeks. Also take note that the “ghost month” is approaching and this may add to the consolidation phase. May be it’s time to hibernate…. as they say, “sell in May and go away...” It’s now June, have you sold yours? Hehehe :)