Category Archives: Properties

KLCI: The Big Crash

CRASH!!! 32.94 points down for our local bourse as foreign funds continue to liquidate their investment in Malaysia, creating panic among the local investment comunities. This massive selldown did not come without any signal. If you are sensitive enough, you would have notice that from the beginning of August, despite gainers outnumbered losers for 9 consecutive days (This is considered extremely bullish as a winning streak of more than 6 days is very rare in Malaysia), the market merely rallied by about 30 points, which was about 3.33 points a day on average. The lack of strength in buying tells us that the sentiment was actually pretty weak. There was no follow through buying. On the 7th of August, divergence in the true sentiment of the market (under Sentiment Analysis) indicated that the uptrend is about to end. Also, since last Tuesday, penny stocks have been dominating the top volume list. As was mentioned in the facebook fanpage, when it’s not the year of pennies and yet they dominate the top volume list, it’s an indication that the market is overheated. Any uptrend is bound to end soon.

klci (6)

Stock-to-Watch: UEMS [5148]

A bad ending it was for the month of July as the market extended its losses by another 22.46 points, after Fitch’s revision of Malaysia’s outlook prompted foreign investors to liquidate their holdings in Malaysia. To-date, the market had suffered a blow of around 40 points since 24th of July, the day our market closed at a high of 1810. This is the perfect opportunities for us to grab some of the fundamentally good stocks at favorable price, so don’t fret.

klci (6)

Stock to Watch: Malton [6181]

To be able to profit consistently from the market, one must not only be aware of  the recent happenings but also understand the consequences of the recent price development towards the possible changes in the big picture and be flexible enough to alter his view accordingly. Let’s look at Malton, a property share which by looking at it’s recent price development, has a good chance of going above RM1 within a few weeks. To grasp a clearer picture, we have to begin our analysis from the 25th of June.

malton (1)

Stocks to Watch: Benalec, Cliq, GOB, Malton, Tuneins, Ytlland

Despite distribution activities happening in a few index-linked stocks, the market sentiment was pretty good today, with a huge number of shares breaking above their short-term swing high after ‘testing the supply” (VSA methodology). In case you don’t understand, it means BULLISH, BULLISH, BULLISH! Let’s skip the talking and look straight at the chart of some of these counters.

benalecBenalec – Closed above RM1.37, forming a Double Bottom.

Stock to Watch: Glomac [5020]

Opportunities for day trading are getting scarcer. With foreign funds began to offload their massive holdings since last week, coupled with the weak performance of the regional markets, our local bourse is expected to move sideway/lower in the near-term. The 1765 support is a crucial level to watch for as a breach will lead the composite index lower, which will definitely cause a round of sentiment-based selling across all shares. While most shares are gradually reversing, some are consolidating and are waiting for the right moment to move to higher grounds. Glomac [5020] could be one with such upside potential.

glomac

Stock to Watch: Uemland [5148]

Our index rose and tested the all-time high today but the overall sentiment remained bearish with losers outnumbered the gainers by more than 150 shares. Such a divergence in the index movement and true sentiment that happened in an uptrend tells us to stay away from the market if possible as the bears are still conquering the market. Having said that, there are still opportunities to profit, especially from the extreme movements of some shares. While most KLCI constituents are in green today, Uemland [5148] fail to stay strong as it slid by 13cents, putting the counter in the top 10 losers list.

uemland (1) (1)

Stocks to Watch: CCM [2879], Tebrau [1589]

The market is extremely bullish today. The index rose by a staggering 17.39 points, with gainers outnumbered the losers by 298 shares. Some of the shares had managed to create new highs (UOADev, Tenaga, Pwroot) and are definitely worth the look as they may continue their rise tomorrow. But let’s not discuss about these shares because despite their possibility of continuing their upward movement tomorrow, the risk-reward ratio will rise slowly as price increases, making any trades in these shares to be increasingly dangerous. We are more interested in finding out shares that have yet to join the hype and are preparing to surge. We shall begin our analysis with CCM [2879].

CCM

The Hot and Sizzling Property Sector

Property shares have been in the limelight for almost a quarter and most have sky-rocketed to a very dangerous level. At this stage, the risk-to-reward ratio is definitely at the high side and we should not chase after these stocks. Having said that, there are still plenty of opportunities to profit from the swings. We shall look at the current situation of a few property stocks from the technical point of view and see how we can attempt to profit from them in the near future at low risk. Let’s start our analysis with Tebrau [1589].

tebrau
After moving within an upward channel for close to 2 months, Tebrau’s share price managed to break above the the ascending broadening wedge with high volume on the 15th of March, sending the share sky-high in subsequent days. Despite supported by volume, its share price has moved too much in too short a period (an average of 7% a day for the past 5 days), making a correction very likely in the near term. The correction that follows should be one of high magnitude since a parabolic movement can be clearly seen in Tebrau’s share price. Reflexivity is obviously at work and any slight uncertainty will trigger the first batch of selling, which will create fears in others to take profit or to cut loss, thereby reinforcing the downward movement. The uptrend could continue for a day or two, but at this juncture the risk is much higher than its reward and thus interested party that are looking to take a long position should refrain themselves from joining the herd in the next 2 days. Remember, losing the opportunity is always better than losing the money. Do not bet on overbought shares, thinking that they would the next big thing. The best strategy now would be to enter only after the share price has retrace to a much lower level, possibly at the 50% retracement level of the most recent up wave, or at RM1.05, a major support level. Next, we take a look at KSL [5038].

Stock to Watch: KSL [5038]

KSL

Why is it that KSL is attractive on the 13th of March when it is trading at such a high price compared to the past few months? In making our analysis on this property company, we shall employ day-to-day bar analysis as well as candlestick pattern. We start from 7th of March, when price shot up and closed above RM1.75 with high volume, indicating bullishness. The day after, a doji with long tail is formed, reflecting a possible reversal. For a reversal to be confirmed, the share price must close below the immediate support of RM1.75 in the next few days. On the 11th of March, the share price opened higher and closed lower at the immediate resistance, making the reversal very likely. At this point we should be expecting another black candlestick on the next day that will bring the share lower and thus confirm the downtrend. But instead of moving down, it moved up and managed to close near the high on the 12th of March. This price development that went against the expectation signaled a possible continuation of trend. The bullishness is further supported by its ability to not just stay above the immediate support of RM1.75 but also closed near its high on the 13th of March, when the broad market shed more than 10 points. Let’s check its relative volume density (RVD) as well.

Stocks to Watch: Pwroot [7237], Spsetia [8664]

Pwroot

pwroot
This is pretty straight forward. After a consolidation of 2 months, Pwroot is poised to move again. RM1.27 is the level to watch closely as a break/ close above would send the stocks fly. If you are a fan of Bollinger Band (BB), the first buy signal would have appear on the 18th of February, when the share closed above its middle band. Today, a further buy signal can be seen as it closed above the upper band of the BB. The support is at RM1.22/ RM1.20.

Spsetia

Spsetia

Watch Spsetia closely as well as it is forming a pennant. Using the flagpole as an estimate, the stocks could shoot up by around 40cents and stop at around its previous high of RM3.78 in the event of a break-above. Immediate support is at RM3.39.