StockWatch (May 2-6, 2011): PSEi, FGEN

PSEi (Chart: Daily Resistance: 4340/4400 Support: 4170/4060)

For last week we were observing if the bullish actions last April 20 would be supported by a follow through in bullishness by Monday April 25. The index did indeed create a significant white candle spread on Monday, but the value turnover was not as expected to ensure a bullish run. It was a mixed trading action where one day’s action is countered by another day’s action as seen by the interlacing white and black candles with varying value turnover. The lack of follow through by the index actually gives a higher possibility of a near major bearish action. As with last week, we have observed a negative divergence between the RSI and the index and within the week, another negative signal has been added with the MACD crossing below the signal line. So we are seeing more negative signals as the index moves sideways, which is definitely something we should keenly observe. I would suggest selling portions of your position for now to lessen your exposure in case a major bearish move happens. If more negative signals pops out, then the popular adage “Sell in May and go away” might come true.

FGEN (Chart: Daily Resistance: 14.86 Support: 13.80)

FGEN has had a good run up since early March. All of the bullish trading days have been accompanied with large volume giving support to the bullish ascent. However for last week, we are starting to see some negative signs that this run up is near its end.

One of the negative sign is the volume on the black candles. We are starting to see increasing volume on the days when black candles were formed for last week. In line with that, on almost all cases since the run up from March, volume on black candles are usually lower than white candles that comes after it, which means that the negative action was countered by bullish actions the following day, accompanied with larger volume. This time around, looking at the trading for the last 2 days, the black candle formed last Thursday was accompanied with an increasing volume compared to the black candle volume last Tuesday. But the negative action last Thursday that was countered by bullish actions on Friday did not surpass or even match the volume of the black candle that preceded it. This is definitely a first sign of weakness.

Another negative sign is the negative divergence between the RSI and the stock. The stock has been moving higher for the past 3 weeks, but the RSI has not gained a higher high.

Although the stock still has the potential to move higher, I believe it might not be able to move higher than 15 if the stock continued to lose volume on bullish days.

For next week, observe the volume accompanied by next week’s trading. If the volume on black candle days increases while volume on white candle days decreases, start selling your position.

StockWatch (Mar 7-11, 2011): PSEi, FGEN, LR, LPZ

PSEi –Weekly Chart

PSEi (Chart: Daily Resistance: 3950/3980 Support: 3705/3605)

The index made good progress last week starting the trading week with a white candle accompanied with large value turnover. The confirmation of the bullish start of the week came only on Thursday as the index was able to move higher with large value turnover compared to last week.

Looking at the weekly chart we can also see bullish engulfing pattern, where the white candle created last week engulfs the black candle created the previous week. The bullish engulfing pattern was also accompanied by large value turnover. They are bullish signs of reversal, but a confirmation is still needed.

For the coming week, there is a certainty that the index would continue its upward movement. However there is an upcoming resistance near the area of 3950 and 3980; these are areas from the resistance line stretching from Feb 2010. The same resistance line has been tested last Feb 18 but was unsuccessful at moving beyond that line. If the index is able to move beyond that line with large value turnover, this might be a sign that we might have a fighting chance to break above the standing downward channel; the resistance line since the start of the bearish trend last Nov 2010. We are still not out of the woods yet even if that happens, because there is still another major resistance near 4400, but at least we are gaining positive movements.

FGEN (Chart: Daily Resistance: 12.20/12.50 Support: 11.60/11.20)

FGEN broke out of a falling wedge formation accompanied with very large volume last Wed. At the same time the recent run up also broke above the 65 day MA. The target price for the breakout is around 13-13.50.

There is an upcoming resistance at 12.20 which is the 130 day MA. For the coming week, there is a high possibility for the stock to move sideways for the mean time. It is possible that the stock would just move in a range between 65 day MA (red) and 130 day MA (orange). As long as the downward movement does not have large volume, it is safe to assume that the sideways movement is just a pause before the stock further moves upward.

LR (Chart: Daily Resistance: 8.80 Support: 7.00/6.60)

LR also broke out of a falling wedge with large volume last Thursday. The target price for the formation is at 9.00. Upcoming resistance is near 8.80 which is the previous high.

LPZ (Chart: Daily Resistance: 6.00/6.60 Support: 5.00/4.40)

LPZ broke out of a sideways channel last Friday, accompanied with large volume. Target price for the channel breakout is at 6.80. There is however an upcoming resistance near 6.00. It is possible that the stock may move in range between 5.60 and 6.00 as the RSI is very much overbought. As always, if the volume on the downward movement is larger than the upward movement, that may be an indication of a bull trap.

StockWatch (Nov 9-13, 2009): PSEi, BPC, FGEN

PSEi (Chart: Daily Resistance: 2970/3000 Support: 2905/2850)

The index is still on a sideways movement for the past two weeks and the break of the 3000 that I was expecting did not happen. As of current the index is moving within a small range of 2905 and 2970. The MACD seems to suggest an impending crossover from the signal line and this we’d have to wait and see if it will bring more buying in the market to nudge the index from always moving sideways.


BPC (Chart: Daily Resistance: 4.20/ 4.90 Support: 3.70)

BPC had a breakout from a symmetrical triangle. Target price for this stock is around 4.90/5.00. There was large volume on the breakout, but it was followed by a sell down the following day also with significant volume. There was a lack of follow through buying which is quite bothering. MACD is bullishly opening upwards, but the RSI suggests overbought condition. It is possible that this stock may move down to sideways next week. As long as the stock does not go below support at 3.70, this stock is still good to play.

FGEN (Chart :Daily Resistance: 19 Support: 16.75)

FGEN also brokeout from a symmetrical triangle with a very large volume. Target price for the stock is around 23. Watchout for upcoming resistance at 19.00 which is a previous high.

StockWatch (Mar 16-20, 2009): PSEi, TUNA, EDC, FGEN

PSEi (Chart: Daily Resistance: 1940 Support: 1800)

Just as I was jubilant that market had already reacted positively 2 weeks ago, the market action last week doused my joy and we’re now back below the 65 day MA. We’re still in the long standing sideways movement of the market and for the following week expect that this sideways to downward movement will continue.

Most are waiting for the market capitulation, and in my opinion, the chart is giving us mixed signs on this. As can be seen in the chart, the market has been on a sideways movement since October of last year, and eversince the low of October 2008, the market has not gone back to that low, which suggests that there is very strong support. With that strong support, there is lesser probability of a market capitulation. However, we’ve been on a sideways movement for nearly 5 months and we are not sure up until when the support will last to prevent market capitulation. This long standing sideways movement is probably contributing to a possible market capitulation with players slowly loosing interest with the sideways movement of the market. We are also seeing shorter rallies as observed from the chart, which might also be contributing to a possible market capitualtion. So as you can see, the current market activity is not pointing to a market capitulation, but the current activity is probably contributing to that possibility. But ofcourse who knows? We’ll probably only know we’re in market capitulation if we realize that we ourselves are also part of selling panic.

TUNA (Chart: Daily Resistance: 1.30 Support: 1.26)

TUNA moved more than what I was expecting. I was just expecting for TUNA to just move and stop just above the resistance line, but it went further to a high of 1.40. The amazing thing was that the move towards 1.40 was accompanied with volume. This is definitely a breakout of falling wedge, but I can’t really say if this is the reversal of the long standing downward trend of the stock or a continuation of the recent shorter upward trend from Jul of 2008. Target price for the falling wedge pattern is at 1.70. As of current,there is a possibility that this stock is also forming a pennant formation with a target price of 1.55. If you plan on getting this stock, buy near support at 1.26. Observe the volume on breakout, there has to be a large volume on the pennant pattern breakout. If you buy at 1.30, cutloss when the stock moves below 1.30. Sell for profit near 1.50. Watch out for the moving averages at around 1.45. If the stock shows signs of weakness at that level, like large volumes on sell down, better sell for a small profit for the mean time.

Note: I have made a mistake last week of positng the TUNA chart for the PSEi analysis and the PSEi chart for the TUNA analysis.

EDC (Chart: Daily Resistance: 3.25 Support: 2.50)

EDC is showing a big smile: characteristics of a rounding bottom pattern. However, I’m not seeing a breakout of this pattern anytime soon because the stock is very much overbought. However, this pattern may still transform into a cup and handle pattern in the future, so watchout for this stock.

FGEN (Chart: Daily Resistance: 21.50 Support: 19.50)

FGEN also showing patterns of a rounding bottom and may have already broken-out of this formation. There is good build-up of volume as the stock pushed beyond the resistance line. Looking also at the weekly and monthly charts, both are also displaying a very good picture of the strength for this stock. FGEN is one of the very few stocks that made it near the 260 day MA(green line). Looking at the MACD, this is a candidate stock to hold for the long haul as long as the MACD stays above the center line. However, the stock is already overbought, so expect some further selling to happen. Target price for the rounding bottom pattern is at 28. If you buy at 20, cutloss is at 19.00 if the stock turns sour.

StockWatch (Sept 29-Oct 03, 2008): PSEi, JFC, FGEN, EDC, SPH

PSEi (Chart: Daily Resistance: 2630/2685/2700/2780 Support: 2468/2342)

The island reversal that showed up in the PSEi chart delivered on its promise with the index moving higher. The index had a little bit of a wobbly start for last week and ended with a bang. The last 3 trading days we saw successive days with the index closing higher. It is worth noting that the index’s advance broke the 65 day MA resistance with high volume, which is a very good break. The next question is whether the index can sustain this bullishness this coming week. The 3 day advance that happened last week maybe showing us signs that we should be protecting our gains. The 3 white candles are similar to the three advancing soldiers’ formation in the Candlestick charting technique. The formation is most of the time pointing to a warning sign that recent upward movement may start to encounter problems on its further bid for its way up. A visible sign for this is that the third day of advance has a shorter white body and longer wicker than the first 2. It opened higher, tried to move higher in the middle of the trading, but just wasn’t strong enough to hold its position, it receded, was not able to recover and closed just higher than the opening price leaving a longer wicker. Again this is just a warning sign, so suggested action maybe to move your stops higher just incase the market went sour you can immediately trigger a sell or for the risk averse, selling some of your positions might be a better idea. Watch out for the upcoming resistances: 2630, which is the previous support line of the descending triangle; 2685, which is the 130 day MA; and 2700, the resistance line extending from May 2008. The RSI may also be posing a resistance for the index as it is near the 50 level.
Again as pointed before, this is still not the time to go long on your positions, the MACD is still below the zero line but is currently showing good signs of a possible cross above the signal line.

JFC (Chart: Daily Resistance: 57.50/59 Support: 44.50)

JFC, just like a dormant volcano, blew its top off sky high, consecutively moving higher for the 5 trading days last week. The bullish move broke the 260 day MA and also the resistance of the downward channel established since April 2007 all with large volume. Possible target price for this stock is at 57.50. I’m not sure what’s going on financially with this stock, but whatever it is, looks like investor confidence came in by the truckloads. Following the Elliot wave pattern, we may now be in the 3rd wave on a small scale with the first and second wave formed from July to Sept 2008. Looking on a larger scale, we may now also be on the 3rd wave with the first and second wave formed from 2004 to 2008. Looking at other indicators, we have the MACD still above the center line, so this means we can now go long on this stock, especially in the light of the recent breakout. Although for the RSI, the stock might be on the overbought level so this means a possible correction is near. This may give us a chance to jump in on the stock when it moves lower. Watchout for support at 44.50, as long as the stock does not go below this level on its correction phase, we are still safe. As the stock moves higher, the MA’s will further confirm this bullishness with crossovers.

FGEN (Chart: Daily Resistance: 25/27/31 Support: 15.25)

FGEN traded last week with large volume. There is no visible area pattern from which a breakout might have happened. The indication of a large volume makes this stock viable for a short term hold. A good signal to start buying would be if the MACD crossed above the signal line. Watchout for the following resistance: 25, which is the 65 day MA; 27 which is the resistance line formed from April 2008; 31 which is the previous high.

EDC (Chart: Daily Resistance: 4.20/4.50/4.70 Support: 2.95)

EDC had a very good bullish rally last week accompanied with large volume. A gap was formed also with good volume. Watch out for further gaps happening in this stock. This stock is good to hold for the short term only. We have the MACD crossing over the signal line, but still below the center line indicating a short term bullishness. The stock currently stopped short of breaking the resistance at 4.20 which is the resistance line formed from Jan 2008. Also watch out for other resistance levels at 4.50 which is the 65 day MA and 4.70 which is the resistance line formed from October 2007. If resistance line from Oct 2007 is broken, there is a possible of stock reaching target price of 6.50.

SPH (Chart: Daily Resistance: 5.40 Support: 4.40)

SPH closed successively higher for the past 2 weeks, breaking a possible sideways channel formation. Target price for this channel is at 5.40. Current level is at 5.20 and is not a good entry level, especially looking at the RSI which is very much overbought. The MACD on the other hand, is indicating a long term hold, so if you are to get in on this stock for the long term hold, wait for the correction before buying.

StockWatch (Mar 31 – Apr 4, 2008): PSEi, FGEN, FPH

PSEi (Chart: Daily Resistance: 2970/3000/3200 Support: 2870/2770)

The index had a rally last week, a respite from the continuous selling that has been the general sentiment since February. The index bounced from the low of around 2770 and proceeded to move up until around 2950. As of last Friday’s trading, a long white candle has formed which indicates bullishness. But the question is how long can this bullishness last? Last Friday’s trading for DJIA saw the US index closing lower on further fears of recession. Will the PSEi follow? In my opinion, with last Friday’s trading, there is still a possibility that the rally may extend for this coming week. The index still has room to move a little higher in the very short term before possibly being stopped by a resistance. The index is currently 20 points away from a possible resistance at 2970 which is the short term trend line from Feb 2008 and 50 points away from 3000 which is another short term trend line connecting the troughs of Aug 2007 and Jan 2008. If the index is able to successfully take out the 3000 level, then we may be able to see the index go higher to around 3200-3300. There is still no sign of a reversal, and the downward trend since Feb is still intact so it would still be best to be cautious and stay liquid for now. If the index is able to successfully take out the 3000 level, then probably it would be a buy for the short term hold only.

FPH (Chart: Daily Resistance: 45-50 Support: 39.50/33)

FPH seems to have broken beyond the short term resistance line from Jan 2008. It is interesting to note that the volume on the way up is increasing which gives more credibility to the upward movement. We can probably consider the levels where there is increase in volume as a good support area later on. With the increase in volume on the upward move, there is still a possibility for the price to move higher, probably up to 45-50, level before encountering resistance at 47-50 levels which is the downward trend line from Dec 2008.

FGEN (Chart: Daily Resistance: 45-50 Support: 36.50/29)

FGEN like its parent company FPH also broke out from a short term resistance which is the downward trend line from Dec 2008. Volume is also notably increasing on the upward move. It is also possible that price may move towards 45-50 level before encountering resistance at near 50 which is the downward trend line from October 2008. From the charts there are also 3 successive notable long white candles that formed last week, the 3 advancing soldiers. This is a sign of strength for the stock especially because the pattern is found at the lower end of the price range. How long that strength can last is still not clear as the recent general sentiment of this stock is bearish so the stock will definitely encounter resistance along its way up.


General Note for FPH and FGEN:

Just like other stocks, FPH and FGEN suffered a beating by the bears, so it is not likely that the price will just shoot up to a new high one day. These stocks would still take time to consolidate and will definitely move with in a range. As of the moment, these stock are trading within a downward channel. For those who are willing to take the risk, you can trade that range for these stocks. However one should be cautious and aware that the general sentiment of the market is still bearish and that even if there are signs of strength for these stocks, this does not guarantee immunity from the ill-effects a of general bearish market sentiment.

In Retrospect : MBT, KPP, ALI, FGEN

MBT
Went beyond resistance level but was unable to sustain the move above it. Last Friday’s trading day saw another effort by the bulls to push the price above resistance level. This coming week would be a wait and see if the bears still have some more strength to pull the price down. Price may move side to downward before pushing above resistance. Recommendation: Hold

KPP
The last 2 trading days was accompanied by very high volume and price went up to as high as 0.59, very much breaking the resistance. Next resistance would be 0.59-0.6. Recommendation: Hold.

ALI
Instead of providing a strong support at 15.75, it became a resistance as price went down and tried to go beyond 15.75. Though there were many sellers that sold down and cashed in at 15.25-15.75 levels , the buyers still had the upper hand as closing price was kept near opening price. Last Friday’s trading saw the resurgence of volume. Hopefully this will be the continuation of the upward move.
Recommendation: Hold

FGEN
The price did move down near support level. Price is now poised for an upward move. This is a good opportunity to capture a P3 move for the short term.Recommendation: Buy at 53-53.50 Sell at 56-56.50

StockWatch (Jan 8 – 12, 2007) MBT, KPP, ALI, FGEN

MBT (Chart: Daily Resistance: 53 Support: 49)

MBT is forming an ascending triangle with resistance at 53. If resistance is broken with volume, price can go up to 61. Recommendation: Buy near the support level, sell if it goes below support with volume.

KPP (Chart: Daily Resistance: 0.54 Support: 0.45)

KPP does not have any area pattern forming, but the unusual volume that accompanied last Friday’s trading and the MACD has brought a positive side to this stock. If the succeeding trading days will be accompanied by substantial volume of 6M and above, there will be a higher probability that this may try to reach the previous high of 0.68 Recommendation: Buy

ALI (Chart: Daily Resistance: 16/16.50/17 Support: 15.50)

Last Friday’s trading saw ALI’s volume sky rocket to 118M. This makes the 15.75-16 level a strong level of support. It also broke the ascending triangle that formed from October –December. Price may go as high as 17.50. But a couple of resistance will be encountered at 16.50 and 17 as these are previous highs. Recommendation: Buy.


FGEN (Chart: Daily Resistance: 56.50 Support: 54)

FGEN is forming an ascending triangle. A possibility of P5 move upwards. But at this point it is still to early. Price may still go near support level. Recommendation: Buy near support