PSEi July 2, 2010

In my previous entry, I mentioned that the PSEi was forming a higher-low, which was a bullish signal. The index continued to form another higher-low on the way to form an ascending triangle pattern, which is also a bullish pattern. Unfortunately, poor economic data abroard, China's slow down, European debt issues and global equities sell-off weigh down our market as well, making the ascending triangle pattern invalid (breakdown of the thick red line). :( However, we're nearing the blue uptrend support line. Could we possibly form another ascending triangle albeit with a lesser uptrend gradient (blue thick line)? I would really hope so.

Possible scenarios on what might transpire to our market in the next few weeks are in orange, turquoise and light green lines. My personal take is the turquoise line, although what worries me is the bearishness of the US markets. The Dow and S&P are showing head and shoulders breakdown pattern. But if many people are seeing the same pattern as I do, many would be in the sidelines rather than in the market. So who would sell down the market anymore? Could this negate the head and shoulders breakdown pattern? I hope it would.

PSEi June 18, 2010

The PSEi was trading on a broad rectangle (somewhat) for quite some time now (since April of this year until now) with 3,100 area as support and with 3,330 to 3,360 as resistances. The first trough within the rectangle (around mid-April) did a bounce even prior to support areas (both previous-highs-now-turned-support (3,130) and the 50-day moving average (maroon line)). However, the second and the third troughs (both in May) pierced through the above supports (both the 3,130 and the 50-day MA), but found some buyers towards the 100-day MA (green line). This was bearish because selling pressures were still prevalent even at previous supports so it needed to correct some more and find more buyers at lower prices, which was incidentally the 100-day MA.

But in June, as market tried to correct again, we found supports now raised higher from 100-day to back to 50-day MA again as you can see in the picture above. This was a higher-low, which is a bullish signal. That means, more buyers are willing to take more risks at higher prices than before thinking that the market's correction is already enough even at that point. Could this propel us above the resistances? Both MACD and RSI confirms a higher-low. Could our market be trending again pretty soon? I think we will pretty soon. I have to admit that our market seems to be very resilient compared to other markets. Let's see next week!

If we do breakout soon, we could see our market hit possibly 3,500 to 3,600. If not, then possibly we'll consolidate some more within the range of 3,240 to 3,360 to gain a better and stronger base. Let's watch out for foreign activity.

Good to be back?!

Nine months! It had been such a long time already since my last entry. I was so busy and honestly it was a bit burdensome to write something here haha! The reason why I wanted to write again is because the market made me call May-day last May. January to April 2010 were good months for me as far as year-to-date returns are concerned. Unfortunately, a series of crisis in May bore a huge brunt in my YTD returns. 2/3 of my gains was lost. Oh great! At least I could still thank the Lord that I'm still positive overall YTD.

"Naked I came from my mother's womb, and naked I will depart. The LORD gave and the LORD has taken away; may the name of the LORD be praised" (Job 1:21 NIV).

Vegetable gardening - August 2009

I tried to venture into vegetable gardening last month. My first taste of veggie gardening was when I was still a kid. I cultivated a tomato plant before. And when it grew to about 2 feet tall, I clumsily hit it with a ball. It died eventually of course. :(

Then last month, I decided to give veggie gardening a shot again. Our barangay (local barrio) gave out free seedlings of 5 different vegetable plants. I only knew 2 of them by looking at the leaves: ampalaya (bitter gourd) and Chinese kangkong (a variety of water spinach). The other 3 seedlings is a toss up among eggplant, green beans and cucumber (I guess). Funny, the barangay guy didn't know them too. :(

Some pictures I have taken since I transplanted them into bigger pots:

Ampalaya (bitter gourd) with make-shift trellis:



Chinese kangkong (water spinach variety):



Could this be green beans? Anybody who would know?


I don't know what's this (yet):

*Edited to add: This looks like a young Okra upon thorough research.

Appreciate who would know these plants. Thanks! :)

There are still others left to be transplanted. Hopefully I can find some time and good soil.

PSEi chart

I'm a bit bearish with our market right now on the basis of this technical analysis above. The Shanghai composite index was down by 6.7% today after a former Morgan Stanley Asian economist said that China stocks are "in deep bubble," and may fall another whopping 25%! Dow Jones down almost 1% as of this writing.

I'm glad to be able to liquidate most of my stocks last week. I'm holding only CMT and Vista Land and Lifescapes (VLL) now. Month-on-month, I'm a bit dissatisfied with my net return (+8%) versus PSEi (+5%) because of some stupid trades and non-trades. I was not able to participate the huge rally last Monday as well, where PSEi rocketed up by 5%, due to some technical problems with my online broker.

Portfolio invested: 33%
Cash: 67%

Mushrooms

Mom bought a home-growing edible mushrooms from a food expo last month at World Trade Center. She got it quite cheap for only Php20 each! Each one can grow mushrooms quite a bountiful of times based on our experience.

Before watering (I know, my phone camera sucks!):



Sprouting stage:


Ready-for-consumption stage:



It takes normally less than a week from sprouting before it can reach full maturity. It's tasteless in my opinion. So you need to season to taste. It's a wonderful experience to be able to harvest our own food from our backyard. I'm trying to do some vegetable growing this time. Hopefully it'll work. :)

August 20, 24 and 25 trades

I sold all my PAX at 3.4 average as it seems to be going nowhere for now. I'll try to bottom fish this one for a change. My system is always been momentum trading, but I'll try something different. Let's see if it will work. I expect this to consolidate within the range of 3.20 to 3.70. Strong resistance is very evident in the area of 3.60-3.70 as we saw a while ago. :)

I got some Philippine Stock Exchange (PSE) stock at 330. I chased this one up after it's breakout of 300 and seeing DW Capital's relentless buying. But I sold too early at 335 after forgetting to cancel my GTC sell order. :(

I averaged down on CMT at 1.04. I know that I shouldn't be breaking my cardinal rule of not to average down. But I can't help it seeing bargains after CLSA dumped much last week. Pattern is still intact towards the target of 1.40. :)

CMT daily:


Yesterday, I was really pissed at my online broker as they had encountered some technical issues with the platform. I called them twice, but tried to remain as calm as possible to dictate to them my orders but unfortunately my orders weren't matched. So I missed the very BIG upside of the market yesterday. :( I realized that my trading system will not work if I have a human broker because I place and cancel orders many times during a trading day. I'll miss much opportunity (or piss off my human broker) if I have to call up and wait on the phone line just for a human broker to post my orders or cancellations. Hehe. Online trading works for me very well. I do hope that they'll do things much better next time.

Anyway, I caught up on yesterday's property sector frenzy by buying FLI and MEG at 0.95 and 1.52, respectively, today. Foreign buying is still very much alive in the property sector especially on MEG. Chartwise, inverse head and shoulders pattern in FLI is still intact with target set at 1.40. My analysis on MEG is a bit unclear. It broke out of 1.48 today with volume and quickly hit a high of 1.54, but it closed back to 1.48. And apparently, 1.60 would pose a hindrance to the ascent (TP of cup and handle).

FLI Daily:

MEG Daily:


Portfolio invested: 55%
Cash: 45%

August 17 to 19 trades

I cut many of my holdings to taper off the massacre in the market. I cut SINO at 0.245, CYBR at 0.71, half of my CMT at 0.97 (which proved to be a mistake), and APC at 0.38. Technically, it seems that SINO and APC both broke down from its support that's why I got rid of them.

Yesterday, I made a boo-boo in Benpres Holdings (BPC). I tried to position first at the bid price of 3.05 while market price was doing 3.10. I was being too conservative! So I missed this ride, only to get it at the ask price of 3.35, which was a resistance. I feared that this will not pierce this resistance, so I cut BPC a fluctuation lower. I was just being jittery in this kind of market. Man, this proved me wrong! BPC pierced this resistance on very good volume and I ended up buying this stock up at 3.55! Wakhonga! Good thing that the momentum was there till today. I sold my BPC at 3.85 today. I should be content. :) Rumor mill says that BPC will sell it's stake in Digitel (DGTL). DGTL flew today as well! Hmm...

I sold the rest of my CMT at 1.06 at a minuscule profit as this was it's previous high. When CMT was trading in the range of 0.93-0.94 yesterday, which was the previous breakout point, now turned support, I hesitated to average down my holdings, thinking that I might just overexpose myself. So I ignored it. Instead I placed my bets on PAX again at 3.375 average. Stupid me! We know what happened to PAX and CMT today. :( I ended up buying the CMT I sold at 1.06 at a higher price of 1.12! My premise is that it broke 1.06 today convincingly. Target of 1.40 is still intact based on the technical analysis on my previous post below.

Market is still jittery. I viewed what happened to both PSEi and Dow today and yesterday, respectively, as a "dead-cat-bounce." Anyway, confirmation tonight and tomorrow is still needed to prove my theory correct. If it happens that our market goes down lower tomorrow, I might add some more CMT near 1.06. Let's see. Cement stocks are in the groove lately. Election play perhaps? :)

Portfolio invested: 44%
Cash: 56%

August 12 to 14 trades

Some blue chips were beaten black and blue, and second tiers and "basuras" (third liners) were set free! My hunch is that "basuras" will take the lime light this week.

PSEi Daily:


PSEi was showing some weakness lately especially on blue chips. Measured move to 2,900 resistance seems to have respected. MACD impending crossover may trigger more selling pressures next week.

---------------

I was experiencing some difficulties with my online trading platform as, probably, it got affected as well by the South East Asia-wide internet problem. So it would be prudent to cash in some gains, if any. But I bought a minuscule Geograce Resources (GEO) again after a long long time at 0.81 on Wednesday as it looked like a valid breakout from 0.79. Volume was exceptional as well. But on the hindsight, it was a whipsaw. It closed 0.79 on Friday. Is it mimicking TUNA after it breaks out of 1.60 then crashing to 1.50 a few days after? Uh oh. :(

GEO Daily:


I cut all my IP at 2.4 as it was just moving sideways. I also sold all my GMA7 at a profit at 7.3 (TOO EARLY!), because that was its previous high. I panicked to sell on this one because I don't want to be caught again by GMA7's one-day-wonder moves. Then a barrage of buying by Regis and BDO elevated the price to close at a day high of 7.8, but it crashed back down to 7.4 on Friday! Anyway, I'm happy with the profits; grateful of God's grace. :)

I sold all my PAX as well at 3.68 average for a profit after seeing it having difficulty going up past 3.75-3.80. :) Short-term players were going in out of this stock for now. I'll get back on this one again near support.

PAX Daily:


Last Friday, I was seeing funds exiting blue chips and rotating to some second liners and basuras. I sold CYBR at 0.72 because it was consolidating at it's lows and without any meaningful accumulation. It did go down to 0.66 (previous support) and some big buying ensued. I managed to ride again on this one, but at 0.73 already (a bit late though). But it still closed up strongly at its high of 0.75 showing a strong reversal. It looks like it will test 0.80's again come this week. :)

CYBR Daily:


I got into some minuscule basuras SINO and APC Group (APC) at 0.28 and 0.42, respectively. Big volumes were traded last Friday. I wonder what were these up to. APC is forming beautifully an inverse head and shoulders formation with potential target of 0.70. :)

APC Daily:


I got into South East Asia Cement (CMT) as well at 1.04 after it broke out of the 1.00 heavy resistance with convincing volume. Charts looks to point to the area of 1.40-ish as its target. :)

CMT Daily:


Composition:
CMT = 16%
GEO = 8%
CYBR = 6%
SINO = 3%
APC = 3%
Odd-lots = 2%

Portfolio invested: 38%
Cash: 62%

Sweet Delights for Everyone

Market is very boring lately and I got some "ipits" (stuck stocks) as well. :(

Anyway, I found an amusing email that I got long ago from my friend in my old and rarely used email account. It's just an eye-opener for all sweet-tooth folks. :P The white cubes are supposed to represent sugar. So more cubes mean sweeter delights (click to enlarge):





I can't believe that strawberries account only that little sugar. Hmm...