July 8 trades

OK. What I find so liberating in the market today was that Liberty Telecom (LIB) stockholders are finally liberated (all puns intended)! From the previous price of just 0.20 about 3 years ago, this stock opened at 1.50 and devouring every single seller mercilessly up to 3.05 in just about 10 minutes from the opening before closing at 2.95. Most of the trades were done around 2.85 to 2.95. We should take special note of the block trade at 3.25 amounting to some Php1.9 billion, bringing LIB all the way to the top of the most active stocks of the day. (Thinking out loud: Where did the 50% ceiling go? This stock shot up by MORE THAN 1000% today!)

Aside from LIB stealing the limelight, it has been a pretty boring day. PSEi went down by 10 points on a measly Php1.5 billion turnover (sans the LIB block trade). I guess it was just that many are on a "wait and see" mode these days. Below is my technical analysis of PSEi (click to enlarge):



PSEi is hugging the uptrend support line for a few days already. With diminishing volume, I'm really wary about this. Resistance is still pegged at 2500, while support is at around 2,440. If we'll see a convincing breakout soon, I expect this market to test 2,626 again. If it will breakdown, we can see some ample support below at 2,350 (previous low), 2,300 (38.1% retracement), and 2,200 (50% retracement and 65-day moving average).

I can't accurately say where we're heading moving forward, but taking cue from the US markets, especially the Dow Jones Industrial Average (DJIA), which broke down from the neckline (at 8,200) of the head and shoulders pattern last night, I'm a bit bearish now. You can refer to the the intraday charts of DJIA on the right part of this blog. Moreover, RSI of PSEi is now below (and testing) the 60 mark, which was also once a resistance.

Due to my bearish mood, I sold all my positions today, except for the odd-lot stocks I have. Odd-lot stocks are those stocks below the normal number of shares required for trading, so I can't sell it (for now). I sold all my PX at 7.5 only to see it go higher towards the end of the day. :( Anyway, a profit is still a profit. Got rid of PAX as well at 2.42. Admittedly I got whipsawed here. I thought it's going to breakdown already by the movement of the price (refer to my analysis on my previous post). But just to give me a peace of mind, I decided to sell even though pennant is still intact not taking into consideration the trip down to 2.36 at some point of the day. Let's see tomorrow what will happen. PAX hit a high of 2.48 on measly volume before closing unchanged at 2.44.

I'm dumbfounded at MER today. It seems that it's not respecting its resistance (closed at 169 today). There must be something brewing with MER and other Lopez stocks. I didn't enter this again. Hopefully I won't regret it tomorrow. :)

Composition:
Odd-lot stocks = 4%

Cash: 96%


** By the way, heard that Semirara Mining Corp. (SCC) won the Calaca Power Plant bidding over Banpu today. Tune in for the news!