Miko's Blog for
July 31, 2010
would like to thank the PSE for correcting the foreign buying/selling
per stock on its daily quotation report last Thursday. Unfortunately,
they have yet to upload the daily quotation report for Friday. Sorry
Tsupiteros but I will not be able to update this website nor will I be
able to write my newsletter without it (hayyy).
Plunge Protection Team (PPT) in the works last night on the Dow and even
with our own PLDT. Obviously, they know their technicals and they know
how critical those support levels are last night.
is finally over and we are now entering the most bearish month of the
calendar - August. Ghost month starts on Aug 10. I hope the markets can
of the day - Spiderman, Spiderman, Friendly Neighborhood Spiderman
July 29, 2010
lot of people are blaming the New Trading System for the condition of
the market right now but what some people don't understand is that it
isn't the system that is the problem, it's actually the state of the
market. Even the smaller fluctuations is not a problem. Prices will
trend when it wants to trend as what we saw in SLI (on the upside) or
PNB (on the downside).
Here's a nice quote I heard from one of the analysts that was being
interviewed in CNBC: "The market is not a bull nor a bear. It's just a
the PSE - Please check the foreign buying/selling per stock in the daily
quotation report. As of yesterday, the values are still erroneous. I
have absolutely no idea which stocks have foreign buying or selling
right now and I don't even know if the aggregate amounts on the whole
market is correct.
July 28, 2010
guess the whole market is now starting to get a hang of the New Trading
System already as value turnover returned to normal and some are
becoming aggressive already.
To the PSE - The foreign buying and
selling per stock in the daily quotation report last Monday and
yesterday were still erroneous.
To COL - The data for Monday from the
broker information page is still erroneous.
Let's get back to the market:
After declaring a tender offer at P75, SMC has decided to offer shares
at P75 once again....and I thought I was the only one who was selling at
"same price" (haha).
on the other hand, has denied that it is for sale. I'm actually
surprised that it's still trading at 41.40 up to now. Take note, a
merger will not require that the stock trade above par. The drop in PNB
has also given a reason to the holders of the other high-flying banks to
finally take some money off the table.
wonder what's up with FLI. Strong earnings maybe? Or, are they going
into REIT perhaps?
July 27, 2010
Still more birth pains for the New Trading System today. Although most
people are a lot more careful with their transactions this morning, I
suspect that were still a lot of error trades today. I only learned this
morning that the market was down by 2 points yesterday on around P1.6
billion value turnover.
saw the PSE upload their daily quotation report this morning but, when I
checked again afterlunch, it was gone. I guess they still needed to edit
it for errors. I hope they can fix that as soon as possible as I cannot
trade properly without that report, which I use to update my charts.
Citiseconline, on the other hand, had most of their functions up and
running already but their broker information pages are still filled with
errors. A friend of mine also told me that, when she sold her
securities, she could no longer use the cash to purchase another
thing people don't realize is that the brokers are having a tough time
right now because everybody is using a completely different software and
to say that it's unuser-friendly is an understatement. Imagine, I
couldn't even look for such simple information as the opening price of a
stock. One of the bugs that I encountered this morning was that I only
had 1 screen instead of the 5 screens that I should normally be able to
access. If I wanted to access such simple information as the top gainers
or top losers in a different screen, I wouldn't know how to do it cause
it's not in the menu (arrggg). As an improvement from yesterday, I
already know what the market did today. Unless that value was erroneous,
the market was up by 20 points today. However, I still don't know what
the value turnover was for the day.
Overall though, I think the New Trading System is fine but will still
probably need a some tweaking. It would be great if the PSE could
re-educate the brokers on the software's complex functionality. I know
brokers like me ought to have learned and studied the software since
months ago but, the thing is, I only realized what the real problems are
when one gets to use the software in real-life trading. So far, I
haven't had any problems in execution and data monitoring. My problem is
more of how to access information in my software.
Sayang lang as we couldn't take advantage of the Dow's strength right
Doesn't this make you wonder of the similar errors we may have had in
the last elections?
July 26, 2010
guess everybody was quite culture-shocked by the New Trading System this
morning. I pity all those brokers who had error trades at the opening
like those who sold MER at 165.00 or those who sold SM at 357.50 or
those who sold AMC at 10.00. I think the only person who was having fun
this morning was Chucky. :-) It will probably take at least this whole
week for the market to adjust to this new system. The broker information
in Citiseconline is still missing right now, the daily stock quotes of
the PSE hasn't been uploaded yet up to now, and, I don't even have any
idea whether the PSEi was up or down and what its value turnover is for
the day. I particularly love the pre-closing period as manipulators can
no longer artificially make their stocks strong at the end of the day.
This change is definitely a good thing. Although everybody hates change,
I do believe that this change is for the better.
July 25, 2010
may want to take note of the following changes in the board lots and
fluctuations in the table below for tomorrow's start of the New Trading
Expect volume and volatility to decrease significantly by tomorrow as
everybody tries to get a feel for the New Trading System. Day-traders
and Tsupiteros will most likely be absent. I'm not sure if the new types
of orders like "Iceberg", "Fill and Kill", "Sliding Validity" and Stop
loss orders will already be effected by tomorrow. Do check with your
broker. Another thing that will be new with everybody will be the
"pre-closing" period at 11:57 p.m. Hopefully, with these new feature,
force closings will now be a thing of the past. Lastly, be patient with
your broker as he will most likely be very, very slow in executing your
order by tomorrow in order not to make any mistakes. I'm guessing, the
whole market will probably need one week to adjust to this new platform.
July 22, 2010
Despite the index hardly moving, I had a very, very busy trading day
highlight of the day was APX/APXB as news came out yesterday that the
company had struck Gold at its Maco Mine in Compostela Valley. I would
like to congratulate Mr. KingsPower on this one. I hardly know anyone
who is as patient as you. The buyers of the B shares this morning have a
lot to smile about right now as they now have a sure 30 cents in their
Another highlight of the day was ANI as news came out today that the
company is going to conduct a 1:1 stock rights offering at P2.50 per
share. The attraction of this one isn't exactly the low offering price
but rather, subscribers of the rights shall be entitled to free
warrants at a ratio of 1 warrant for every 2 shares acquired by the
stockholder. The company pegged the strike price of the warrant at
P10.00 per share. This will be another new playground for the Tsupiteros.
the last couple of weeks, DGTL has been quite weak due to the huge
foreign selling order in the stock. Today, something quite interesting
happened - Macquarie crossed 65 million shares at P1.44 per share 9
minutes before today's close. The question now is, could this be the
last batch of selling from the foreign funds?
my position in AMC too early today. Oh well, "wala pa ring tatalo sa
more trading day before the New Trading System of the PSE goes online.
It will be a whole new different ballgame come Monday.
July 21, 2010
saw a lot of movement in the market today but the index itself did not
move a lot. I guess, without the run-up in ALI today, the market would
have been almost unchanged. The problem with trading this market right
now is, you need to anticipate what's going to move. If you buy after
you see the move, you're already too late and you may already be buying
at the highs. If you get ahead and buy too early, you might be buying
something that will not move. I'm playing this market very cautiously. I
think both our market and the Dow is directionless right now.
wonder what the fuzz was all about in MPI. I think a lot may have been
whipsawed in that stock today. Could the stock actually have formed a
major bottom already today at 2.48?
Finally! I think we've seen the peak in RFM and VLL.
really wonder why broker 110 is buying and selling so much shares in ORE
at almost the same prices everyday. JAP, pag hindi ka na galit sa'kin, I
hope you can explain it to me someday. :-)
two trading days to go before "all hell breaks lose" (hehe).
the way, here's an interesting excerpt from this week's newsletter of
is a financial astrology website:
are entering a time band of perhaps the most powerful geocosmics
signatures of a lifetime. We’ve never seen anything quite like what we
are about to witness in the next month.
So we don’t really know what to expect, except the unexpected. Normally
we might think the Saturn-Uranus opposition would be a crash, and it
might be. The previous four times in this series, it has correlated with
a crest (not a trough), and after three of those times, the DJIA fell
over 1500 points within the next 3-6 weeks. If you want to trade, you
have to be nimble and ready to reverse quickly, perhaps on an almost
daily schedule. If you cannot handle the stress of risk, stay out and
watch this cosmically historical pattern unfold, and watch with
amazement at the types of human activities and financial market
movements that will likely unfold – assuming they don’t do the
unexpected and absolutely nothing of note happens."
July 20, 2010
drops by 261 points and our market dropped by just 18 points. Dow climbs
up by 56 points and our market still drops by 18 points. Talk about a
very confused market! I don't think I even want to make a guess what the
market is going to do by tomorrow.
been under-estimating the strength of RFM and VLL for the last few days.
Admittedly, I've been calling a "take profits" on these stocks since
last Friday, yet, prices just continue to climb higher. I guess bears
like me will be correct one of these days (haha). If you remember, I
recommended buying VLL as early as the 1.60s levels while no one was
buying it. I figured that the stock was erroneously sold down simply
because Villar lost the elections. There is one stock right now that
appears to me is in the same situation as VLL when it was at the 1.60s
levels. It was also sold down aggressively simply because Noynoy won the
elections. I bought a small position in this stock today. By the way,
good luck on your RFM Mr. Jaka! :-)
was the strongest stock in the market today. Given the way it behaved
today, this should begin to trend up already. The key word here is
continued to be relatively strong today. Curiously though, despite the
huge buying orders from CLSA, Deutsche Regis and Macquarie, foreign
funds were net sellers today in PNB. Hmmm...
July 19, 2010
drops by 261 points and what did our market do? It drops by a mere 18
points with even a lot of issues going higher. Prices isn't trending up,
yet, it ain't dropping either. So, what do we do? One thing I noticed
though is, I make more money when the Dow drops a lot compared when it
goes up a lot. Hmmm
like to congratulate CLSA and Macquarie in VLL. I wonder if those were
foreign funds or Mr. Villar himself.
the first time in a long time, we finally got a taste of a stock that
went to the ceiling price by way of MED. Could this be the start of some
"ceiling plays" once again? I really miss those days. Good luck Mr. Jaka!
was also very strong today on news that it was going to do a rights
offering at P1.00. I could be a buyer of the stock this morning but I'll
be a seller at P1.00.
Another highlight of the day was PNB. I heard rumors this morning that
PNB is no longer a "merger play" but may actually be a buyout? Maybe El
Kapitan is slowly preparing for retirement perhaps?
July 16, 2010
experience in the market today made me contemplate on the state of this
market. Yesterday, there were only three stocks that looked very strong:
JGS, RFM and VLL. I don't like to trade RFM because it's just too
choppy. I didn't like VLL either because I find it too high already. So,
I chose to trade JGS. The stock moved very strong for the first time in
one month, closed at a new high and had foreign participation. Today,
there were just a complete absence of buyers. It's as if everyone who
wanted to buy the stock have already bought and there was just no one
else left who was willing to bid it up anymore. I decided to sell my
position at cost today.
complexion of this market has changed a lot in the last two months. It
has just been a slow grinding up and very selective market. To make
money, you not only have to be very, very patient, you also need to buy
the right stocks. Tsupiteros like me are not making much in this
environment. It is those people who buy low and wait that make money.
The problem I have is, I'm certainly not willing to change my strategy
at this point in the game with the market already up by so much since
the Mar 2009 low. So, what do I do? JAP and Chucky are certainly not
giving anything for free. The speculative issues are in a coma and the
high-flyers are, well, already too high. Let me know if you have any
Looking at the market from a bigger perspective, I would tend to think
that we are now in the last phase of this bull market, which began last
Mar 2009. The markets are still strong because they are expecting good
2nd quarter reports. However, there will be a slowdown in the 2nd half
and up to next year because the effects of the stimulus packages would
have worn out already. So, will the markets "sell on the news" once the
2nd quarter reports come out? We have three weeks to play 'til ghost
month begins on Aug 10. We better make the most out of this next couple
July 15, 2010
market has only been forgiving for those who know how to follow the
trend. For those who are trying to pick bottoms, they are probably not
making very much right now.
has been up by for seven consecutive days in a row. Could it be toppish
in the short-term right now? I'll be quite surprised if the Dow
continues to climb up by tonight. Of course, I think everybody has been
expecting the Dow to drop since a few days ago. Eventually, the bears
will be correct. :-)
race between DGTL and VLL has been overwhelmingly won by VLL. However,
at current levels of both issues, could it be time to shift from VLL to
DGTL once again?
think some property issues peaked in the short-term either yesterday or
today but they are definitely trending up.
July 14, 2010
haven't been writing in my blog cause I've been quite busy. I was
suppose to write something last night but power got cut-off in our house
because of the storm.
Anyway, our market has obviously broken out convincingly above its
13-week consolidation and may already be on its way to my original
target of 3600. I don't know if you've noticed though but, although the
market is now in a trending phase, it is trending up in slow motion. Is
this behavior bullish or bearish? I would like to think that it is
bullish because, with this kind of behavior, some are selling
pre-maturely and could potentially buy higher. Nevertheless, it is still
a very, very selective market, especially if you go to the 3rd line
Since yesterday, it would appear that the darling right now are the
property issues. I don't know what the foreign funds ate but they
suddenly developed a huge appetite to buy property issues like ALI and
MEG. RLC and SMPH are a bit lagging at the moment compared with ALI and
MEG but I would tend to think that these two will eventually play catch
up as these two issues are the main plays on the REIT law. If I'm not
mistaken, they are simply waiting for the implementing rules and
regulations from the BIR to jump-start this law. I expect a "breakout"
on these two issues soon. FLI seems to be in middle of these two groups.
VLL has gone up quite a lot already so that might consolidate first for
now. ETON is a double-bladed sword as it is not only a property play but
also an El Kapitan play. The weirdest property stock for me right now is
SMDC but I'm still bullish on this one as well. I'm not touching LND but
ELI, in my opinion, could be a dark horse.
Let's just hope the Dow doesn't spoil the party.
July 10, 2010
had a great time in the party last night. I approached JAP and shook his
hands and he was sport enough to shake my hands as well (I'm quite
relieved that he didn't punch me in the face). I listened to his speech
and one of a couple of things that I remembered that he said were: that
we are all Filipinos and we should work together, and, one should learn
to buy when no one else is buying and sell when everyone is buying. I
totally agree with him on these issues. I also remember him saying that
he made mistakes in GEO and other issues. One thing that he mentioned
that I disagreed, of course, was that he downplayed that use of
Technical Analysis in the markets. Well, to each his own on that one but
I would presume that he uses Technical Analysis too but he just doesn't
know it. There were some company presentations and, of course, there was
a company presentation on ORE. I listened but, of course, I'm a skeptic
as people probably know by now that I am a skeptic on everything under
the sun. In my opinion, it is very difficult to turn a company that is
currently "nothing" into "something" but, to be fair with JAP, I'm
giving him the benefit of the doubt. I sincerely wish him good luck that
he will be able to turn this company around and that he will make a lot
of stakeholders very, very happy in the future.
I was not the one that force closed ORE at 2.70 yesterday.
have a date Danny Go - Jan 9, 2011.
July 9, 2010
is the market a breakout or not? I guess this is still the question that
everybody is asking themselves right now. I don't know myself but I'm
staying defensive for now, just to be on the safe side.
quite amused by ORE right now. Could the play be over already? I'm
excited to meet the boss tonight. :-)
and BPC were one of the strongest stocks in the market today as FPH
announced a P6 billion buyback program. Congratulations to all those who
have this one!
would like to congratulate my officemate in HDI for being the very first
person I know who tried to day-trade Manila Bulletin. Nice try bro! (haha)
July 8, 2010
was kinda busy yesterday, which is why I wasn't able to write here in my
Anyway, finally, the Dow was able to rally from its lows. Now what? Time
to short-sell perhaps? It is interesting to note that Jakarta and Kuala
Lumpur, which have been very strong markets as of late along with our
market, were hardly up today. Did our market really breakout today or is
it a trap? Another thing worth noticing is that, even though the US
markets climbed up a whopping 3% last night, you would be very lucky
already if your position climbed up by 5% today.
day of SCC's rights offering is tomorrow. Time to take profits?
There will be a grand eyeball tomorrow between my friends at Absolute
Traders and my other friends at FinanceManila. JAP will be the special
guest of honor. I'm guessing that ORE will register at a new 52-week
high by tomorrow. This time, I can really congratulate you Mr. HE
July 6, 2010
the last couple of days, I was thinking that the market has broken down
already and will begin to trend down. Obviously, the market is still
alive but is still within the "calm before the storm". Notice that value
turnover has now dropped significantly from its average. I guess some
people (including myself) are still betting that the Dow will begin to
rebound either tonight or tomorrow night. I'm expecting a massive short
squeeze rally soon. The big question is, what happens after that? By the
way, if the Dow drops by 3 digits again tonight or tomorrow night, that
behavior would confirm that that market is now in a bear market.
was the top gainer in the market today. I heard some news that the
company was planning to drill some oil in Palawan this July. It's high
today though at 3.45 is a major resistance level. Will try to get more
info on this one. Congratulations to all who have SOC!
July 5, 2010
Today was probably one of the most boring days of the year as value
turnover was even less than P2 billion. Can the market still trend up
from here? While there may be buyers down below, there is obviously a
lack of buyers up above. I think the Dow can rally from here but I
really doubt if it can still climb back up towards 10600. Today is a
holiday in the US so we won't know the verdict until Tuesday night.
There's some activity in the Power sector today as the Aboitizes and EDC
were relatively strong. Be careful on some companies announcing that
they too are going into power. While they may say that they have plans
of entering the power business, some of these are merely stating such in
order to sell their shares in the market at a high price. This same
phenomenon happened when mining was the "in" thing and it too happened
when being in the BPO sector were the "in" thing.
highlight of the day was no other than Mr. JAP's ORE. I'm guessing that
this will be bullish until Friday. :-)
July 3, 2010
Is long-term value investing
Another Structural Change in the Markets?
of peak uncertainty, market participants tend to look at the bigger
picture for answers. I’m not talking about the big philosophical “whys”
of life (e.g., Why do I exist?), but the more market oriented questions:
What is causing this market behavior? Why is it happening? Can it
this discussion is taking place now that the markets are reaching nine
month lows. Pundits lament that corporate earnings are projected to be
very strong when second quarter numbers are rolled out. The bears point
out that state and local governments will have trouble balancing budgets
with current revenue shortfalls and bailout money fading. This will
lead to payroll cuts that directly affect consumption patterns and will
have trickle down effects on the economy.
As with most
macroeconomic analysis, it’s almost impossible to tell which point of
view will win in the intermediate term. We do know, however, that this
market downturn has added a significant element of fear back into the
market. Multiple media outlets report that Google searches for phrases
like “double dip recession” have increased in the last ten days. And,
as reported in
many professional money managers are moving more toward cash.
the most intriguing work that I’ve been looking at points to a
structural change taking place in market activity. Let me explain what
I mean by structural change and then we’ll look at what might be
The Nature of Structural Changes
argue that we have just entered another bear market phase in equities.
That is a change in market category or type. When I talk about
structural changes, I’m referring to fundamental changes in the way
markets operate over time. Any number of causes can produce this level
of change, but I’ll mention three of them today: technology, regulation,
and financial innovation.
technology, like the telephone in Jesse Livermore’s day or in the
Internet in ours, has certainly caused changes in how the markets behave
(among other effects, both of these technologies shortened the news
changes definitely have affected the way markets behave. When margin
requirements were raised from 10% to 50% after the 1929 crash, fewer
dollars were chasing the same amount of shares. The data reporting and
execution changes made in 1997 that made intraday trading possible for
retail traders ushered in a new order of magnitude of volume into the
market. Decimalization further reduced transaction costs and almost
completely killed one type of trading (retail market making became
instrument innovations have also led to structural market changes.
Mutual Funds allowed retail investors to participate in equities markets
on a scale never before seen. Derivatives allowed institutions to hedge
risk and/or take on huge leverage in ways that were not possible
A New Structure: The Same Investor
Psychology but Bigger and Faster
these changes led to different trading and investing dynamics. At their
core, however, market movements remain driven as always by the
cumulative effects of the market participants' fear and greed. We can
display the classic investor psychology market cycle of bottom, rise,
peak, fall on a chart as a sine wave.
though the forces that drive the markets remain the same, it fascinates
me that their expression is evolving. If you think about the cycle of a
sine curve, it moves up and down a certain amount and it repeats within
a certain time frame. Structural changes in the markets are altering
the characteristics of that cycle. It seems that the amplitude (the
level of highs and lows) is increasing while the frequency (time between
successive highs or lows) is getting shorter.
I saw the
chart below in a blog recently. This intriguing graphical display
depicts the expanding amplitude of the moves of the Dow over the past
crossed below the “12 year breakeven” line since this graphic was made
in May 2010 with the Dow closing at 9774 on Wednesday. But the reality
of the chart is stunning: bigger and faster climbs followed by bigger
and faster drops. And for the past 12 years or so, this led long term
investors on a road to nowhere.
visual is perhaps the best that I’ve seen that truly shows how buy and
hold is dead. Imagine the work involved holding onto investments for 12
years that included an Internet boom and a real estate boom and having
no gains to show for the effort in the end.
July 2, 2010
think the Dow may have bottomed-out already last night in the
short-term. I would be quite concerned for the short-sellers in the US
markets already right now but I would be more concerned for those who
are currently long here in the PSE if the short-sellers in the US
continue to make money. Actually, even if the short-sellers in the US
lose money, I am still quite concerned of those who are currently long
in the PSE. :-)
July 1, 2010 (pm)
have a trick question, what would happen if everybody was looking at
the same pattern and was looking at one direction? Below is a picture of
the S&P 500 with prices appearing to have already broken down below the
neckline of its head and shoulders pattern.
I'm not bullish but prices can certainly rebound from here. Obviously,
my "Dow 10900" has become invalidated already and maybe even my PSEi
3600. I'm beginning to see "ghosts" instead.
July 1, 2010 (am)
updated my Tsupitero index to give us a real sense of what the whole
market is doing.
removed the following issues from the index: EDC, FPH, TUNA, AGI, LIHC,
BRN, FLI, ISM, WEB, PAX and GEO.
added the following issues from the index: AP, ANI, JGS, BEL, CYBR, MRC,
SMDC, DGTL, APC, CPM and ORE.
index is currently up by 26.28% year to date as compared with the PSEi
which is up by 10.52% year to date. My previous Tsupitero index
was up by just 2% year to date. This just goes to show us that the
market has been highly selective in the last six months. For one to have
made money, you ought to have been in the right horse, so to speak. The
question now is, do we continue to buy what's strong, or, do we start
buying what's low? Anyway, here's how the index looks like right now: