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.

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: CMT, PAX, WIN

CMT

CMT move down to as low as 1.10 this week breaching the long term resistance line for the second time. Trading last Friday brought the price back above the resistance line. Price may move sideways to down next week. This is now a crucial part of the stock: if price is able to hold above the support line, this means there is strength in this stock. Otherwise, price may move to the next support levels 1.08 and 0.99.

PAX

PAX moved sideways this week. Fortunately the island reversal still holds, as the gap was not filled up, this means there is still strength in this stock. However, the price level at 15.25 which is also the resistance line connecting the peaks from year 2000 to 2006. This is a classic close quarter battle between the bulls and bears. The bulls are trying to hold the gap while the bears are preventing the price to move above the resistance line. For the coming week, price may move sideways. If the gap is closed, then this is definitely a sign of weakness of the stock.

WIN

WIN went to as low as 0.31 respecting the support line of the triangle for the 3rd time. This is a good sign for this stock. This could be the next Piso stock if we try to plot the target price of the triangle. However, as I have said before, it is still too early in its formation and anything can still happen. For range trading, getting in at 0.33 would still give a good profit considering a target price of 0.44 (65 day MA)

StockWatch (Sept 3-7, 2007): PSEi, CMT, PAX, WIN

PSEi (Chart: Daily Resistance: 3390/3460/3500 Support: 3317/3260)

The index has now formed a possible exhaustion gap. This looks like an early warning sign for the index. RSI seems to be contradicting the gaps formed as RSI is still halfway from reaching the 70 mark of being overbought, however considering we are on a bear market, usually the 50 level is already considered an overbought level (as 50 is sometimes the oversold level for a very bullish market) . The Dow closed 100+ pts higher last Friday, the local market may follow on Monday. This means we may reach near 3460 level (the 61.8% Fibonacci retracement), within the coming week. There is also the 65 day MA to watch out. Interestingly, if the 61.8% Fibonacci retracement would prove to be a resistance, this may somehow pave the way for the creation of a head and shoulders formation. The left shoulder and the head are already formed (marked as number 1 and 2). We are still waiting for the right shoulder and right neckline to be formed. It’s an exciting wait-and-see for the coming weeks if indeed a right shoulder will be formed. Now try to close your eyes and imagine the right neckline forming near 3460. See it? =) Now try to draw the target price for the H&S formation! Whoaoooo!!!!! Target price is around 4075 level (also the 127.2% Fib extension). Come to think about it, there maybe some possible technical truth to what analysts are predicting of reaching the 4T level by end of the year. Now slap your face! Wake up! This is just a hallucination for the moment. My analysis might be incorrect as the left shoulder might be too short to be a valid shoulder and it is still too early, anything could still happen! Hehehehe! =)

CMT (Chart: Daily Resistance: 1.40/1.55 Support: 1.24/1.08)

CMT has been moving with large volume for the whole week. This definitely is a very bullish sign for this stock. There is currently no area pattern for this stock except for a sideways channel. Current resistance is at 1.40 and 1.55 which are 50% and 61.8% retracement levels. MACD is now above signal line which is a bullish sign and RSI is half way to being overbought. The trading last Friday displayed a large upper shadow on the candle which indicates that bears are starting to move in. It is possible that sideways to downward movement may happen this coming week.

PAX (Chart: Daily Resistance: 15/16/17.50 Support: 14/13.25)

PAX may have formed an island reversal. The breakaway gap was accompanied by large volume. What would be good to see is that everyday trading volume would also increase to indicate that there really is momentum in this stock. As of current the large gaps on the downward move may be a cause of concern for traders as this translates to resistance. The stock may move sideways to downward for the coming week. What to look out for the following weeks is the possible formation of a runaway gap.

WIN (Chart: Daily Resistance: 0.37 Support: 0.30)

WIN is currently forming a symmetrical triangle. As of current it is still in its early stage of formation. The current level is a good buy level considering it is near the support line and that the target price for range trading at 0.45 is large enough to support a 1:3 risk to reward ratio. However price may still move down to 0.30. If you are able to get in at 0.33, cutloss if it goes below 0.29

In Retrospect: PCP, NI, JFC, GEO

PCP

PCP went to as high as 0.75 before moving down to as low as 0.53. Price movement for this week may either be side to down. Next support is 52/49/45

NI

NI went only as high as 27 and as low as 23. I was wrong on this one, neither a break out nor an upward move happened. Price continued to move downwards. I guess I was wrong at anticipating an MACD cross above the signal line to propel an upward move, which never happened.

JFC

JFC went to as low as 53 for the week. I was wrong again on the upward move, as price went down. Triangle is still intact so this is still a stock to watch.

GEO

Move down last week and somehow invalidated the ascending triangle. Looks like further downward move for this week.

StockWatch (July 16-20) : PCP, NI, JFC, GEO, PEP, WIN

PCP (Chart: Daily Resistance: 0.61 Support: 0.45)

PCP gapped up and brokeout from an upward biased channel (probably a weird looking symmetrical triangle) doubling the price in just 1 week. Target price for this pattern is 0.65. But looking at a larger picture below (PCP-Weekly chart), we can see that PCP has formed a rounding bottom with a target price of 1.14. But this rounding bottom may still have a possibility of moving sideways forming a cup and handle. PCP is definitely a buy.

PCP-Weekly Chart

NI (Chart: Daily Resistance: 30/28.50 Support: 22.50/19.75)

NI has formed a symmetrical triangle with a possible MACD cross above signal line. Price may still move higher this week. The current symmetrical has a target price of 44. But this symmetrical triangle may become an ascending triangle if the previous high of 30 will become a strong resistance. Current price of 26 is a buy considering a resistance of 30. It’s a wait-and-see if this week would be a breakout or just an ordinary continuation of the upward move probably up to resistance of 30.

JFC( Chart: Daily Resistance: 57/61 Support: 54/53)

JFC’s symmetrical triangle is still intact (see StockWatch and In Retrospect for Jul2-6). The price went to as low as 54. For the coming week, price movement is side to upward. Target price for the symmetrical triangle is 68.50. At current price of 54, this is considered a buy.

GEO (Chart: Daily Resistance: 3.05 Support: 2.70/2.50)

GEO has shown signs of divergence of the RSI and MACD against price. MACD and RSI has formed a lower low while price has formed a higher low. As of current, there is still room for further upward move. The pattern looks like a small ascending triangle, but the volume last July 5 seems to break the diminishing volume characteristic of an ascending triangle. If the ascending triangle is really valid and breaks out, target price will be at 3.70. With consideration of the divergence, it might be good to lighten your position at that level and buy back later.


PEP might move towards 0.98 possibly forming either a symmetrical or ascending triangle with possible MACD crossover

WIN might move toward 0.75 possibly forming either a symmetrical or ascending triangle, with possible MACD crossover