31 August 2011

Goodbye Ghost Month, Hello Mooncake Festival!

Today was a classic case of “Marking the Close” for a lot of stocks. Trading opened with a nice little gap up, from 4,305.56 to 4,319.06. Thereafter, the PSEi went straight to the day’s high at 4,351.57 before trending lower to near the opening level. There was huge buying right at the close, bringing the index back to 4,348.50. Congrats to the tsupiteros who punted this correctly!

Depending on how you look at things, this is the 2nd or 3rd bounce off of the 4,290 level. This short-term support level has persisted so far.

The PSEi appears to be going sideways. It’s neither pushing past 4,550.53, nor breaking below 4,157.03. It’s just been ranging well within this medium-term range.

Incoming PSEi stocks continued to climb, with BEL (+16.34%), CEB (+1.62%), SMC (+0.81%), SCC (+3.42%) and SMDC (+4.25%) all extending gains. That said, outgoing PSEi stocks FLI (+1.79%), LC (+1.9%) and SECB (+0.99%) went up as well. Other outgoing stocks, ABS (-2.17%), and FPH (-0.09%) declined. Holding the incoming 5 instead of the outgoing 5 PSEi stocks appears to be a good idea so far.

Volatility fans are spoilt for choice right now. Wide daily price ranges were evident in BHI (0.385 – 0.465), BEL (4.21 – 4.75), and MIC (5.63 – 6.24). BEL is pushing short term highs, while BHI and MIC are pushing long term highs. Many are saying BHI and MIC are parabolic already.

As I write this, the Dow Jones is up 0.7%. European markets were better, with most up 2% to 3% today. It will be interesting to see how our markets look like after the “window dressing” effect wears off.

Many of the movers in this market appear to have shifting fundamentals or are simply pump-and-dumps. It’s best you do your own due diligence to discern which is which. Caveat emptor. Good luck on your trades… and your dice games! 🙂

30-34. Heads.

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