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Miko's Blog for
Feb 2011
February 28, 2011 (3:00 p.m.)
Market is acting very, very strange . You see stocks
like AEV going to the roof yet there are also stocks like PX, which
appears to have fallen from a cliff. Fund managers rebalancing their
portfolios maybe? ATR Kim-Eng and Philippine Equity Partners selling
everything and going all-in in AEV?
If we took out AEV from the index, market would still
be down by 24 points at the close. AEV is now the second most heavily
weighted stock in the PSEi index. Could it be that they are using the
stock to prop up the whole market? That use to be the role of TEL but
telecommunications isn't the "in thing" anymore. Foreign funds were net
buyers by P1.5 billion today but if we removed the net buying from AEV,
foreign funds would still be net sellers today by roughly P500 million.
I am shocked by AEV. I knew it was still going up but
47.00? Medyo nasobrahan yata. Congratulations to all those who were able
to buy it 44.00 when DBP-Daiwa sold it down.
RSA stocks were on the move again today led by PCOR.
Let's hope there is something more to this than just a one to two day
rally.
Market appears to have finally bottomed-out today in
the short-term but I don't expect a big uptrend to occur yet. I'm glad
February is over. March can't be any worse than this.....right?!!
February 26, 2011 (8:15 p.m.)
MA failed to hold on to its gains and appears to have
peaked at the 0.036 level. I saw Mr. Bennett sell 400 million shares at
0.034. Although his last purchase at 0.035 was sold with a one fluc
loss, he was simply trying to protect his gains. Overall, he was still
able to make money. Mr. Bennett definitely knows how to trade.
Congratulations Mr. Bennett!
Foreign funds bought P340 million worth of AEV today
but they were only net buyers by P7 million in AP. Is there really
something special with AEV compared with AP, or, did its inclusion to
the MSCI index simply saved the day for AEV?
For those of you who would like to trade the price of
Oil, you do not trade stocks like OV or OPM. Instead, what you can trade
is CEB. If Oil spikes up, CEB will come plunging down, but, if Oil drops
back down, CEB should climb back up. By the way, I heard that there was
a sale in Cebu Pacific right now.
The market still sucks but I hope we can start rebounding
by next week. I don't know if you noticed but some Asean markets like
Jakarta and Singapore have rebounded quite a bit already last week.
The Dow was up by 61 points last night but the Dow
isn't exactly showing the true picture of the markets. Both the S&P and
the Nasdaq were up by more than 1%. Europe as well were up by more than
1%. A 1% climb in the Dow is 120 points. Maybe I should start looking at
the S&P instead.
February 24, 2011 (9:45 p.m.)
There are only two stocks in the market right now,
AEV and MA. The rest are living dead.
So far, it is AEV which is pulling AP from its rout
but will this get sustained? From Feb 1, 2011, foreign funds bought P823
million worth of AP and P943 million worth of AEV. These humongous
foreign buying may be both bullish and bearish. It's bullish because, if
they are willing to bet that much money into those stocks, then, those
stocks must have great prospects in the future. But this may also be
bearish because, if the market turns from bad to worse, they may be the
ones who will bring these stocks down as they reverse their positions
from being a buyer to a seller.
Tsupiteros though are not really minding the
Aboitizes but are now concentrating on the only play in town, Manila
Mining. I'm quite amazed with Mr. Bennett. He bought 200 million shares
at 0.031, sold it at 0.033 and bought everything back at 0.035. Wow!
Either he's fuckin' genius or he's damn greedy. Whatever happens though,
I have to give him five stars for courage. Sorry Mr. Bennett, can't help
but notice you. :-)
The market is just teetering above its support at
3700. Will it hold? I'm no longer quite sure. The main difference
between this current crisis and the one that we have had in the past is
that we are dealing with several countries here, in which some of them
could disrupt the supply side of Oil. Let's hope for the best but,
somehow, I don't think this crisis will go away that easily. From the
way I see it, they are like ticking time bombs, which could blow anytime
and could disrupt the financial markets from time to time. Of course,
once this crisis ends, you can be sure that the stock market will come
running back up.
February 23, 2011 (9:30 p.m.)
Market has obviously formed a short-term bottom today
but....
I'm curious about the Aboitizes. AEV looks like it
has just held above its support and is ready to trend back up. AP, on
the other hand, is bearishly consolidating at its lows and looks like is
getting ready to break down. I wonder which is going to pull which?
Watch that 26.00 level in AP. If that level breaks, I'm going to bet,
most of those foreign funds buying that stock in the last few weeks will
start to reverse and sell that stock down. Of course, AEV might actually
be the leader and may pull AP up. So confusing!
Dow dropped by 178 points last night. It's the first
big drop in the Dow for quite a while. The big question now is, is that
just a correction and prices will trend back up, or, is that the start
of a much bigger correction? Your guess is as good as mine.
February 22, 2011 (8:30 p.m.)
Just one week ago, I was quite certain that the
market has found a bottom already. Now, I'm no longer quite sure as we
are back here to where we started just one week ago. The rally a couple
of days looked, smelled and felt like a dead-cat bounce. There wasn't
volume and it wasn't broad-based. The big question now is, are we going
to break below that major support at 3723? Maybe not yet, or rather, I
hope not.
I think we can survive a crisis in Libya but, one
thing I'm sure of, if the crisis suddenly spreads to Saudi Arabia, all
bets on the long side are off. Take note, if Saudi Arabia gets affected,
it isn't just oil that will will be affected but our overseas
remittances as well.
Is there any light at the end of the tunnel? The only
light I can see is that the market is quite oversold already and a lot
are already quite bearish and are probably in cash. I haven't ruled out
the bulls yet but the cavalry needs to arrive soon, otherwise, all the
bulls will get slaughtered by the bears.
February 21, 2011 (7:30 p.m.)
Could that have been the rally already? My guess is
no but who knows?
Did you make money in this last rally of the market?
Because, admittedly, I didn't. I bought a couple of issues when the
market was trading at 3750 to 3800 but, unfortunately, I bought the
wrong stocks and they hardly moved. Out of 5 stocks that I bought, only
1 made money. Three hardly moved and I even got killed in 1 of those 5
stocks. This is not a good sign for the bulls because for the market to
climb higher, people need to be enticed to trade. How can you entice
people to trade if they don't make money. Furthermore, if I bought at
the bottom and I didn't make money, what more for those who are
currently stuck at higher prices? For the market to trend up, those who
got stuck must be able to get out. Otherwise, there will always be an
overhang whenever prices start to rally.
I'm looking at the chart and my mind is telling me
that we've made a low already but, somehow, this market is not giving me
much evidences that we did make a low already. Is everybody bearish? I'm
not quite sure of that too cause I myself am looking for a bottom.
As much as my left brain is telling me to just stay
in the sidelines, my right brain is telling me to keep on trying because
we are at the bottom (arrrggg).
February 20, 2011 (12:00 a.m.)
Miko's Fearless Forecasts:
1. Gold will reach 1500.
2. Dollar index will dive to 70 while Peso-dollar
will soar 41.50 soon.
3. PSEi has formed a major bottom at 3723 and will
climb back up to 4500.
4. Asean markets have bottomed-out too.
5. Dow may hit 12500 to 12750 but will have a correction soon afterwards.
6. Piolo will admit that he's gay (joke) :-)
There will be a point wherein foreign funds will sell
US equities and will flow back in to Asean markets. Otherwise, they will
lose just on the exchange rate alone.
(Please take these with a grain of salt. No one can
predict the markets 100%)
February 17, 2011 (6:30 p.m.)
Finally! The market has rallied! The only problem is,
were you able to buy the right stock? Among the more liquid issues,
there were only 10 stocks that went up by 3% or more. All the other
issues were either almost unchanged or were even down. I guess it's
still going to take a while before the market's confidence gets back to
what it was one month ago. Right now, people are still just trying to
recuperate from their losses.
ELI, which performed very well when the market was
falling, was the weakest stock in the entire market today (with the help
of Mr. Bennett). This is the problem for traders right now - the market
just so inconsistent. What may be strong today, may be weak tomorrow,
and, what may be weak today, may be strong tomorrow.
News came out that SMC was going to postpone is
secondary offering to next quarter. I guess even the mightiest will need
to bow down to the forces of the market. It would be interesting to see
how Megawide would perform tomorrow.
February 16, 2011 (8:00 p.m.)
So far, so good for the bulls. For the first time in
a long time, the PSEi went up despite the Dow dropping last night.
Today's behavior also told me that no one was holding positions anymore,
which is why the market no longer went down. Also, for the first time in
a long while, the market registered net foreign buying. Although foreign
funds were just net buyers by P48 million for the day, it would seem
that their selling is starting to taper off. I'm hoping that we could
make a run towards the 4000 level in the next few days. :-)
My litmus test, PCOR, initially appeared to have
failed but, by the end of the day, was able to eke out a gain. Did you
notice that a lot of people have begun to bid up prices once again
today?
My last indicator to tell me that we are at or near
the bottom already is TEL. It looks extremely oversold to me. I bought
tons of this one today. Value turnover for TEL was a massive P843
million. It seems to me like there is some serious accumulation going on
there. Will just wait for the annual P130 cash dividend come mid-Mar.
:-)
Although I'm quite confident about the overall
direction of the market, what I'm having a hard time is, which horse to
pick. Hopefully, one of these days, stock-picking won't be a problem
anymore, that is, if the whole market goes up.
February 15, 2011 (8:00 p.m.)
The market continued to behave today as if this
downtrend will continue. I don't know if you noticed but India was up
once again today. Some Asian bourses were close today but, let's see,
this could be the start of something, I hope. :-)
What this market needs now is a leader to pull
everything up. For the last few days, everytime something goes up
strong, it tends to drop again the following day because no one wants to
bid up prices. There was one particular stock today, which could be the
litmus test for the whole market - PCOR.
Ironically, the best that this market can hope for is
for the Dow to drop a lot so that the bears can really be tested.
Unfortunately, markets rarely drop in periods of low volatility, just
like what the Dow is doing right now.
Below is the chart of the PSEi with a completed A-B-C
corrective wave pattern. If my analysis is correct, the market may have
ended its corrective phase already and is now ready to trend up once
again. In the big picture, could it be that the market had just ended
its 4th wave and is now ready to begin its final 5th wave ascent? Only
time will tell.
February 14, 2011 (9:00 p.m.)
For the first time in a long while, all the regional
markets are up for the day. It seems that the PSEi has found a
short-term bottom at 3723. The question is, is it also a medium-term
bottom or is it just a dead-cat bounce? I'm trying to analyze myself
because we ourselves are a microcosm of what the whole market is
thinking. I am very cautious with my trading nowadays and I very much
under-positioned. Although I am open to the possibility that this market
may have already bottomed-out, my portfolio is telling me that I am
still bearish. If the whole market is also under-positioned like me,
then, we may already have formed a bottom or are already very close to a
bottom at 3723. Of course, if foreign funds continue to sell out of our
market, then, it is unlikely that we will go straight up from here.
The problem with this market now is, how to trade it?
Let's say, we are already presuming that the market has indeed formed a
bottom at 3723. If so, do we just buying anything and everything in
sight? Definitely not. I don't know if you've noticed but the market is
very, very selective. Quite a number of issues still went down today.
Obviously, momentum trading is not an option nowadays because there is
absolutely no momentum anywhere. Thus, we are only left with buying the
dips. The problem with buying the dips is that, unless you're lucky and
you are able to nail the exact bottom, it is very, very easy to get
shaken out if prices drop below your cost because you are always scared
that the whole market might continue to drop. A solution - Do your
homework and commit yourself to a position. Buy small
tranches in different prices by either averaging up or averaging down.
Of course, stops will still need to be placed but it needs to be a
fairly wide one in order to avoid getting whipsawed. Gung-ho, shoot
anything that moves type of trading will not work right now.
Of course, another option would be to just stop
trading and just come back when the market is trending up again. If you
decide to do that though, don't regret having missed a couple of hundred
points from the bottom. This market will only trend up if it is able to
break above the psychological 4000 level. Of course, if the market is
not able to trend up and prices drop below 3723, you will be one of the
happiest traders in the PSE.
At this point, the market may either be at the very
bottom of the pit or is just a couple of steps away from a cliff. Let's
just hope it's the former.
February 10, 2011 (2:30 p.m.)
The market is now in a free fall as it has now broken
below its 200-day moving average at 3750. Where is it headed? Your guess
is as good as mine. This would be fun if the Dow drops a lot tonight.
Those who are new to the markets and have just entered within the last
two years are only starting to realize that there lives an animal called
a Bear.
By the way, after what happened to Mr. Angelo Reyes,
could it be possible that the Generals are the ones selling out of the
market right now?
I'm watching carefully all those stocks that are
hardly dropping. Take note, I'm talking about the liquid issues only.
Those illiquid, speculative issues are simply not dropping because
sellers have no one to sell to.
AGI was not able to sustain its upward momentum as
foreign funds were not willing to bid up the stock. The local funds can
only do so much to push the stock higher but, if the foreign funds
aren't biting, the stock simply has nowhere to go in this environment.
MRC was one of a handful of issues that were up today
on news that its subsidiary will do an IPO. Who are they kidding? I
don't think even the Megawide IPO will survive.
One stock that I'm curiously looking at right now is
FDC. Summit Securities has been heavily buying into the issue but ATR
Kim-Eng has been heavily selling. Could these be real buyers and sellers
or could they just be passing it on to each other to attract buyers?
SMC's public relations officer is certainly very,
very busy nowadays. I don't know if you've noticed but, everyday, there
is a disclosure in the stock.
Don't worry Tsupiteros, there will be a light at the
end of the tunnel. Remember, there are always opportunities in times of
crisis. I just can't see the light yet (haha).
February 9, 2011 (3:30 p.m.)
The Dow looks like is doing a parabolic rise and the
PSEi will do a parabolic drop? Jakarta currently down 2% as of this
writing. Last line of defense is at the 200-day moving average at 3750.
When the market becomes weak like it is right now,
only the most fundamentally sound issues with a story can survive. Those
jockeyed stocks, which were artificially pushed up during the bull
market, will naturally drop and find their true value as seasoned
jockeys know that they will not be able to fool anyone in this kind of
market. Take note, if the jockey is really good, he should have been
able to dispose his positions a few weeks back already when the market
was still strong. Of course, if the jockey was able to get out, the
public is now the one left holding the bag. It's a cruel game where only
the best traders will survive.
The big story of the day is AGI. I think the market
is gaining interest in the stock as it tries to anticipate better than
expected earnings for the 4th quarter of 2010. COL has been the big
pusher of the stock in the last few days but, the question still
remains, will it be able to breakout of its range and start to trend?
The foreign funds are the key but, so far, they are not biting. Let's
see if some will start chewing if the price can manage to climb above
12.50. You can do it Mr. Edward Lee!!!
February 8, 2011 (5:00 p.m.)
With the Dow climbing up by my favorite number last
night, I was hoping that the PSEi could finally start to get some
momentum going today. Unfortunately, that wasn't the case and the market
is still very weak. Notice that Jakarta and India were down a lot today.
I don't think the PSEi is out of the woods yet.
I find SMC weird. Everybody seems to agree that the
stock will go towards RSA's 250.00 level, yet, the stock just keeps on
climbing still. Normally, if everybody is bullish in a stock, the stock
no longer climbs because everybody who wanted to buy that stock has
already bought it. Or, maybe, everybody is thinking like me, which is
why it keeps on going higher. The worst thing that a trader can do is to
reverse psychology himself.
NIKL should be bearish right now because the big
buyer of this stock in the last few weeks, COL, has begun to sell since
yesterday already. I noticed something strange in the stock today though
- RSA buying? No way!
A friend of mine, who got quite disappointed with her
ELI today, noticed something peculiar about the stock. It closed at
0.69. Didn't the Dow go up by 69 points last night too? It must be a
sign!!!
February 7, 2011 (8:00 p.m.)
So far, there is just absolutely no signs of strength
in this market yet. Foreign selling have subsided since last Friday but
I have a bad feeling they just stopped selling because they couldn't
find any buyers anymore. Notice that value turnover is now just P3
billion a day. This low value turnover is both bullish and bearish. It
is bullish because it indicates a lack of sellers but it may also be
bearish because buyers are no where to be found. The big question is,
are most people stuck at high levels or have most people sold already.
The former may indicate that we are going to 3500 while the latter
should indicate that we are going back to 4400.
You are already doing a very good job if you are
still up in your portfolio year to date.
February 3, 2011 (8:00 p.m.)
One of the ironies of trading is that it is very,
very difficult to buy at the bottom. During bottoms, bad news are
everywhere (net foreign selling), the trend is clearly down and
sentiment is very bearish. Tendency of people is to just punt and trade
because prices might drop further. However, if one would just use common
sense, bottoms are areas in the chart where one actually needs to buy
and hold and not punt. The best traders are those who can buy when the
market is in a panic and sell when the market is in a euphoria.
Below is the current chart of the PSEi in a weekly
perspective. Notice that prices are now testing the 40-week moving
average. Notice also that the stochastic oscillator is at an oversold
level and looks like is about to turn up. The last time that the market
had this technical condition, prices ended up climbing by 58% after 8
months' time. I'm certainly not Nostradamus but I'm betting "up" from
here. Have we seen the bottom at 3830?
February 2, 2011 (5:30 p.m.)
Could we have already seen the bottom, or, is this
just another dead-cat bounce? My friend Elliott (wave) is telling me
that we may have already seen the bottom of this 3-month downtrend but
who knows?! The bulls are probably hoping and praying that Mubarak
finally steps down. :-)
Congratulations to all those who bottom-picked the
market yesterday! You could have easily made 5% today if you picked the
right stocks.
I wonder if the MVP rumors on MA are true this time
around or could it just be another one of Lolo's "merry-go-round".
I'm looking at AGI and, after four months of
consolidation, I believe the stock is now about to do something
completely different. :-)
February 1, 2011 (2:30 p.m.)
Sometimes, trading reaches a point wherein you say to
yourself, why am I doing this? Am I a masochist? ... This feeling is
especially true when you try to buck the trend and try to buy in a "long
only market", which is currently trending down.
The Dow appears to have already formed a bottom last
night or so it seems but, if the Dow suddenly forms a long black candle
tonight, we might see some blank stares in the PSE by tomorrow.
Watch the 200-day moving average!
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