StockWatch (Oct 13-17, 2008): PSEi, TEL

PSEi (Chart: Daily Resistance: 2270/2360 Support: 2036/1900)

Last week has been one of the biggest drop in the market since Aug of 2007 when the current credit crisis started to become a buzzword. The index shed 400 points and broke the support at around 2350, which is the support line of the symmetrical triangle formation. Possible target price for the drop is around 1900. Next support is at 2036, which was the previous low of June 2006.

The question probably in everyone’s mind is when will the selling end? Well from the chart, it seems that we are about to see a rebound from the lows of last week. The RSI is pointing to a very oversold market and it is possible that next week will be bargain hunting week for those who still have the money and the guts to get in the market.
The MACD is still in the bearish territory, so trading strategy would be to hold only for the short term. There are still no signs of reversal, so watchout for this. It is possible that an island reversal or a double bottom may form as a reversal for the short term downward trend.

TEL (Chart: Daily Resistance: 2350/2425/2550 Support: 2245/2000)

TEL broke the support line at 2500. Possible downward target price is at 2000. With RSI at a very oversold level, it is highly probably that a rally will first happen for this stock before either proceeding towards the target price or if the bulls are able to take control, this stock may be able to move above the previous support line. Price levels at 2400 -2500 are critical as these are resistance levels for the possible rally.

If the support at the current level holds, then there might be a possibility of a double bottom formation for this stock. But this is still too early to confirm. If your are to take advantage of the rally, hold on to this stock for the short term only. Sell if it is unable to break above the previous support line.

In Retrospect: EEI, TEL

EEI

EEI continued to move sideways for the past week. However there seems to be a small light of hope last Friday with the stock gaining around 3% and volume of around 4.8M shares traded. If the stock is able to gap up with more than 4M shares traded, this is a sign of strength for the stock and a formation of an island reversal.

TEL

TEL was able to significantly create another gap up on the second day of trading last week and as expected, resistance at 2900-3000 level was encountered. There will probably be profit taking for the coming week. If the support at 2905 holds for next week, then the stock might be good for another climb probably towards 3200 level.

StockWatch (Jan 28-Feb 01, 2008): PSEi, EEI, TEL

PSEi Weekly Chart
PSEi (Chart: Daily Resistance: 3330 Support: 2980)

The index has reached the downward TP of the channel from where it broke down. Currently an island reversal has been formed confirming the action for the past 3 trading days. The island reversal is an indication that the index is now on its way to retrace the previous action, however, this is not a guarantee that we will be out of the downward moving action. We still have a couple of resistances on the way up, one of which is the support-turned-resistance line at around 3330. Also, we have been successively gapping up for the past 3 days, forming a break away gap and a run away gap. We have yet to see an exhaustion gap, so we may see cautious trading towards the end of next week. . Looking at the MACD for the daily and weekly chart, we can see that we are still in bearish territory despite the 3 successive up days, so the appropriate strategy would be just to take short positions until probably all notable resistances are taken out.

EEI (Chart : Daily Resistance: 2.50 Support: 2.36)

EEI looks promising as volume for the past 2 days has been exceptionally large and has the potential of retracing its previous downward move. It has currently established support at around 2.36 and has been trading sideways. However, this stock hasn’t been responding positively with the recent 3 day upward move by the index. So buying at this time is too much of a risk. A good buy signal is probably when the stock gaps up with volume of around 3M.

TEL (Chart: Daily Resistance: 2900/3000 Support: 2740)

TEL has already reached its downward TP and has surpassed it. Currently, the trading last Friday has created an island reversal, a confirmation that the recent downward move has ended. Upcoming resistances are previous highs of 2900 and 3000.

In Retrospect : URC, MWC, TEL, PCOR

URC
URC broke the support at 18.50 and went to as low as 18 before closing at 18.25. Recommendation: Observe, price may either move sideways or down.

MWC
Broke out of a falling wedge, but it still needs to break out from the 65 day MA at 9.40. Target price is at 11. Recommendation: Buy, but be on the look out for the resistance at 9.40

TEL
TEL challenged the support at 2610 and went as low as 2570. Price may still go to as low as the next support at 2550. But price may bounce up from support within the week.
Recommendation: Buy near 2550, sell if it goes below support

PCOR
PCOR went to as high as 4.70 with very high volume. If this is a continuation of the break out last Jan 17, then the 4.70 target price has been reached.

StockWatch (Jan 29 – Feb 2, 2007): URC, MWC, TEL, PCOR

URC (Chart: Daily Resistance: 19/19.50 Support: 18.50)

URC could either be a descending triangle or a symmetrical triangle. If it is a symmetrical triangle, it needs to takeout the 3 MA’s before breaking out. Recommendation: Buy near support. If price goes below support, sell

MWC ( Chart: Daily Resistance: 9.00/9.50 Support: 8.80/8.60)

MWC seems to be forming a falling wedge. At current, it is still too early to tell as price may still bounce at 8.80 and may distort the falling wedge formation. Recommendation: Wait and observe, check if support will hold. If support holds and is accompanied by volume of around 10M and above, buy.


TEL ( Chart: Daily Resistance: 2720 Support: 2600/2550)

TEL gapped down with little volume, which might be a good indicator that there are still a lot of traders holding on to the stock. At this point price may still move down or sideways, probably testing support at 2600. What is promising about TEL is that is has now broken its sideways movement and the trading last week has had the price moving above the resistance of 2610 with price going above 2800. This may be a start of an upward channel. Recommendation: The stock is a candidate for range trading. Buy near support and sell at 2800 and beyond. If it goes below 2550, sell.

PCOR ( Chart Daily Resistance: 4.20/4.35 Support: 4.10)

PCOR broke out of a small channel last Jan 17 and was accompanied by 20M volume. I personally thought that the breakout would somehow be able to sustain the momentum and break the resistance that formed since August. But to my dismay, the price went down and went back inside the channel. But analyzing the volume on the downward movement, there was far less volume on the downward move, which is good sign that a lot are still holding on to the stock. Add the increase in volume in the recent trading, which could indicate that there is accumulation going on at 4.10-4.20 level. A break above 4.20 is imminent this week if the volume still picks up. Recommendation: Buy at 4.10-4.20. Sell if price goes below 4.10.