Anecdote: You've had too much of stock trading when....

...you start to unknowingly use stock tickers to replace the real names of the companies during a conversation with your wife.

It did happen to me a few nights ago. I rendered OT work, and ate dinner at Jollibee. When I got home, my wife and I had a little conversation. She asked me "saan ka na nag dinner?" and I unknowingly answered her back, "sa JFC! ". And ofcourse I got a blank stare from her and she replied "saan? sa KFC?". =)

If you have your own anecdote to tell or if you have any other ideas on "You've had too much of stock trading when..." or "You've had too much of technical analysis when..." , do leave a comment to share. I'll post those stories or ideas next week, just for fun. =). Thanks!

StockWatch (Dec 17-21, 2007): PSEi, SMC, MWC, SMPH

PSEi (Chart: Daily Resistance: 3630 Support: 3500/3450)

After a great upward move breaking the resistance line, the index was unable to hold its position above the resistance line and fell below the line. The gains that was made the previous week was wiped out last week. The bearish move by the index was a surprise for me as I was very much expecting that the index would probably move sideways and consolidate further before moving upward considering the bullish signs that is has manifested. Looks like the general expectation that the index will reach 4000 level before the year end will not happen. We only have this week to consider as a normal trading week as the trading action on the last week of the year will probably be lethargic as some may be on holiday mode already. So it will be impossible for the index to rally 500 points in just 1 week. The index may still reach the 3520 level next week before moving either sideways or upward in between 3600-3700

SMC(Chart: Daily Resistance: 60.50/62 Support: 58/55)

SMC and SMCB had a very bullish move last week breaking several resistance lines with large volume. The stock went as high as 60.50 and may still continue to move probably reaching up to 62. However, looking at the 3 consecutive trading days where it made a wild run upwards, it has formed a “Three advancing white soldier” candle stick pattern, with the third candle stick showing signs of weakness as the body of the candle stick is smaller relative to the first and second candle sticks. I believe that the recent upward move is already a sufficient gain for those who have this stock, so it would be best to start cashing in on those gains. The stock is still bullish, so we can just buy back at later time, probably with in the level of 50-55. Don’t forget the ex-div date on Dec 18, if you get too complacent with the recent bullishness of the stock, you just might find yourself loosing some gains come ex-div date.

MWC( Chart: Daily Resistance: 18.50 Support: 17)

MWC is showing signs of divergence of MACD movement against price. Price has formed a higher high, while MACD seems to be having a hard time to establish a higher high. Price as seen on past movement, after a run up, the price action goes on sideways, so expect that price may move sideways with support at 17. Watch out if price moves below 17 with volume. If it does, we may see price to move towards 13.

SMPH (Chart: Daily Resistance: 10.75 Support: 10/9.30)

SMPH broke down from a support line of around 10.50 and with large volume. As of current the area pattern seems to be a head and shoulder or a symmetrical triangle. Either way, its downward target price is around 6.00. However, RSI is currently oversold, so there is a chance that a bounce may happen and hopefully that bounce would have volume that may counter the effects of the breakdown. If that bounce is able to counter the breakdown, then that is a very bullish action and may be considered as a failed head and shoulder. Assuming this becomes a failed head and shoulder, a good volume to support the action would be around 30M shares. Otherwise it’s just a futile attempt by the bulls to re-instate the price above the resistance line.

In Retrospect: COL, BPC, MIC

COL

COL retraced 60% of its recent short upward move placing the stock near the resistance line of the symmetrical triangle. As of current even with the recent downward move, the stock still displays some bullish signs. The MACD is still above the signal line, the MA’s are still in the proper order, and the volume on the downward move were not accompanied by volume as there was more volume on the days when it was bought up, than when it was sold down. If this stock is still bullish, it may be able to pull up above the 65day MA and hopefully consolidate and hold its position above the MA. Otherwise, if the stock has really turned bearish, we can confirm it if it breaks the 10.75 support.

BPC

BPC was unable to hold its position above the resistance-turned-support line and went back in the triangle on the last trading day. This stock may still move further downwards probably reaching 3.80.

MIC

MIC did not break out from the symmetrical triangle last week. Instead it consolidated further. The price action is now near the apex of the symmetrical triangle, there is a higher possibility that we may have to redraw our triangle. What this stock currently needs is for it to consolidate in between 7.30 -7.80, the price levels of the previous gap down last October so as to eliminate resistance coming from those still holding position at those levels. For the coming week, this stock will probably move down to sideways. Watch out for support at 6.10

StockWatch (Dec 10-14, 2007): PSEi, COL, BPC, MIC

PSEi (Chart: Daily Resistance : 3770/3810/3890 Support: 3680)

The index showed further bullishness as it was able to open higher on the first trading day last week. This bullishness was further supported by the 4 other actions by the index. First is the gap up that happened on Thursday, which led to the second action which is the breaking of resistance line established from the recent downward trend. The third is the closing of the gap from the first week of November and fourth is the MACD crossing above the signal line. The breakout from the resistance line is just a confirmation of the recent upward move, however it is still not a breakout from an area pattern as we do not have a valid area pattern for now. For the coming week, we may see the index consolidate in a sideward movement and may also re-test the resistance-turned-support line. The sideways consolidation is what is best for the index as it has now recovered 60% of the recent downward move from October and it still has not consolidated. Any further upward move might place the index in levels where the bulls might not be able to support.

COL (Chart: Daily Resistance: 14.50 Support: 10.50)

This stock was featured by Bonner at the Absolute Traders website. It has formed a symmetrical triangle with resistance at 14.50. Possible upside target price of 22. For those doing range trading, you can buy at 12.50, sell at 14.50, cutloss at 11.75. As of current the stock is now bullish as it has gone past the 65 day MA and MACD is now above the signal line. Average volume is around 1M, a good break out volume should be above 4M

BPC (Chart: Daily Resistance: 4.65/4.85 Support: 4.35)

BPC seems to have broken out of a symmetrical triangle formation, however I am not quite sure about the volume on breakout. It was accompanied by large volume, but I am not sure whether it is sufficient. The stock is currently re-testing the support line. What we need to see is for the volume to pickup for the coming days. Also what is noticeable in the chart is a head and shoulder formation that did not push thru. However it cannot be considered as a failed head and shoulder as it did not break down, so it is currently more of a symmetrical triangle. Target price for the triangle is around 7. MACD is bullish, but RSI is near overbought, so there might be some further re-testing of support for the coming days.

MIC (Chart: Daily Resistance: 7.50 Support: 6.80/ 5.60)

MIC is also a candidate for a symmetrical triangle. Breakout point is 7.50 Target price is 15. MACD is currently bullish and RSI is just halfway from being oversold. Average volume is around 4M, a good breakout volume is around 20M shares.

In Retrospect: SMC, JFC

SMC

SMC had tough time last week. The bears were successful last week of preventing the price from moving further as trading was always closing lower than the opening price. During the bearish trading last week, it was somehow able to form a support at 50. However, a resistance was also formed at 51.50. So we could say that it is currently consolidating and moving side ways. Checking on the indicators, the MACD has crossed above the signal line, which is bullish. The RSI on the other hand still looks good as it is still below the centerline of 50, which means the recent bearish week is not yet the end for this stock and that it is just taking a breather from the recent upward move.

JFC

JFC had a very bullish start last week with the stock opening higher than its previous week’s close, reaching 52 before closing at 51.50. The rest of the week was characterized by bearish action topping with a sign of indecision on the last day as price opened and closed on the same level. The stock may further consolidate next week, as it is currently in between the 65 and 130 day MA. Sideways consolidation is actually good for the stock at this point as a breather from the recent upward move. Still watch out for the possible inverse head and shoulder formation with resistance at 54.