StockWatch (Apr 28-May 2, 2008): PSEi, AT

PSEi (Chart: Daily Resistance: 3050 Support: 2777)

The index is still very much volatile as the index moved lower last week reaching a possible support at 2777. The trough that formed last week did not hold and index also penetrated the trend line from Feb 2008. There is a possibility of a double bottom if support at 2777 holds. Otherwise we may see the index move towards another possible support near 2660, which is the trend line connecting the troughs from 2003. There is a possibility of a rally next week.

AT (Chart : Daily Resistance: 14 Support: 12)

AT has been amazingly making good upward progress for the past 2 weeks. There seem to have formed a double bottom area pattern for AT with the neckline at 12. Last Thursday that neckline was broken reaching to the highest of 12.75. The breakout volume was also significantly large. Other good thing to note about the chart: A.) The MACD is now above the center line which is a bullish indication. B.) The price is now also above the trendline connecting the peaks from May 2007 which means that the stock is possibly out of the downward trend. C.) Price was able to move above the 65 and 130 day Moving Average. The not so good about the chart is that the RSI is now on the overbought area. The target price for the double bottom formation is at 14.50. This stock is currently a buy because of the breakout from the double bottom. But still be cautious in trading the stock, as it has been moving upward for the past 2 weeks and the RSI is now overbought. Trading last Friday saw the stock being sold down to the support at 12. This selling was accompanied by large volume, which is nearly half of the breakout volume. There is still a possibility of a bull trap for this stock if it breaks the support at 12

StockWatch (Apr 21-25, 2008): PSEi

PSEi (Chart: Daily Resistance: 3050 Support: 2900/2880)

With last week’s price action, it looks like the index is trying to establish an upward trend. As of current, the index has established a higher low, which is a good sign that price aren’t likely to head south again for the mean time. Other good things to note: A.) the MACD is still above the signal line in spite of the successive downward action in the index. B.) Both RSI and MACD are oscillating near the 50 level and center line respectively. Things to watch out: A.) MACD crossing the centerline might trigger some buying action in the market. B.) Upcoming resistance at 3000 which is the resistance line forming from Dec 2007. If price is able to move above this resistance, this will be another victory for the bulls and might help propel the index towards the next resistance at 3200. In general, the market is now out of the bearish dive and is consolidating. Trading strategy would either be to still stay liquid or trade the range. For the risk averse, probably the safe time to get in and start buying would be when the index crosses the center line.

StockWatch (Apr 14-18, 2008): PSEi, LCB

PSEi (Chart: Daily Resistance: 3050 Support: 2880/2870/ 2770)

The index dropped to as low as 2931 last week and retraced more than 38.2% of its rally the previous weeks. Some positive things to note, the index is still above the support line of Feb 2008 and MACD is still above the signal line. What we want to hopefully see is the MACD to oscillate near the zero line, while RSI to oscillate near the 50 level. Otherwise if MACD went lower than its recent low and RSI brokedown from the 30 level, then this is a signal that the downtrend is likely to continue. Next support for the index is at 2880-2870, which is also the 61.8% retracement. With the US market again closing lower last Friday amidst further recession jitters, the PSEi will most likely follow its move this coming week.

LCB (Chart: Daily Resistance: 0.39 Support: 0.30)

LCB is showing signs of a bullish divergence, both RSI and MACD forming a higher low, while price forming a lower low. What’s also good to note about LCB is that the MACD is oscillating near center line. Hopefully, it would be able to move above the center line. Aside from those, there is also a possibility of an inverse head and shoulder formation, the left shoulder and head already formed, while the trough of the right shoulder is still being formed. We can confirm if this is a valid inverse h&s formation if it is able to break 0.39 with volume. As of now, it is better to just observe the stock.

StockWatch (Apr 7-11, 2008): PSEi,AC

PSEi (Chart: Daily Resistance 3050/3200 Support: 2930/2770)

The index had a continuation of the previous week’s rally with the index moving beyond 3000 level and reaching 3050 as its highest last week. If one would ask if this is a sign of better things to come, well I hope so. But what the charts are telling us at the moment is that we are still inside a bearish phase. If one would observe the RSI and MACD on the bullish phase, both RSI and MACD are oscillating above the 50 RSI level and MACD center line. As compared to what we have currently where the RSI and MACD are oscillating below those lines. It is most likely that the RSI and MACD will oscillate below those lines for a couple more weeks and hopefully this would pave the way for consolidation in preparation for another bullish phase. But ofcourse the bullish phase is still too far in the future. Another item to observe though is a probable inverse Head and Shoulder formation. With the left shoulder that formed last January and the head currently forming. Assuming that the dip in the index last March 17 is the tip of the head, we could probably guess that the head would be completely formed by near end of April. Ofcourse this is still for observation. Trading strategy would still be to stay liquid or if one would take advantage of the currently volatility in the market, trading strategy would be to hold for the short term only. We might see some dips in the index for the coming week, it would be best to protect any gains from the recent rally.

AC (Chart: Daily Resistance: 422.50/430/450 Support: 400)

AC is showing good signs of recovery from the recent downward movement. First good thing to note is that a bullish divergence can now be seen from the RSI and as well as the MACD. Second item to note is that the recent run up that happened last April 2 was able to break above the downward channel that formed since December 2007. The breakout was accompanied by good volume. For the coming week, price would probably trade between 450-382.50. As long as the price does not go back inside the downward channel, AC will still be promising. There is still no reversal area pattern formed, but watch closely as the recent low of the stock at 382.50 might be part of a double bottom formation.

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.