StockWatch (Feb 16-20, 2009): PSEi, MER,WEB, AP, BPC

PSEi (Chart : Daily Resistance: 1970/2004 Support: 1866/1818)

Nothing much happened with the index last week. The index moved sideways, and this time, its seems that the 65 day MA is providing support. Volume last week was unusually large, but the action last week doesn’t give much of a clue as to where the index would move next week. In the US, Barack’s stimulus plan just got passed in the congress, and I’m not sure how the local market would react with this news. But based only from the stochastics, the index would probably move sideways or down next week.


MER (Chart: Daily Resistance: 85.50 Support: 71)

MER had a very surprising 2 week rally at a time when most of the stocks are taking a beating. From the chart we could see this rally contributed to the breakout from an upward moving channel. But not all good things lasts, and the formation of a black candle last Friday is probably an indicator that a correction to this 2 week rally is coming. Next week expect the stock to correct and re-test support at 71.

WEB (Chart: Daily Resistance: 0.037 Support: 0.033)

WEB seems to have broken out of a pennant formation. Target price is nearly reached and RSI is very much overbought, so expect a correction by next week. Price is now above the 260 day MA, which is a very welcome sight. However, the RSI and stochastics are pointing to a correction by next week.

AP (Chart :Daily Resistance: 4.75/5.00 Support: 4.10)

AP had a breakout from what seems like an ascending triangle or probably a symmetrical triangle. Target price is at 5.00, but it seems like a correction is about to happen next week with the RSI very much overbought. Watchout if this breakout transforms into a flag or pennant formation. Also watchout for the volume during the correction. If there is little volume on the correction phase, this is a good sign that a lot are still holding on to this stock and that the continuation of the rally may happen after the correction.

BPC (Chart: Daily Resistance: 1.32/1.70 Support: 0.95/1.08)

BPC also had a breakout of a vey small and slim symmetrical triangle. Target price is at 1.32 which very near the breakout level. It is not advisable to get this stock as of the moment, since the target price is very near and RSI is on overbought level. Watchout if the stock is able to maintain its position above 130 day MA. This would be a very good sign of strength if it is able to maintain a position above the 130 day MA.