Animal Menagerie, week ahead.  

Posted by Book Eater in , , ,

First of all, I have been quite messy with my trades, my time tables, and in fact even with posting here in my trading blog. Here are some resolutions I am planning to do.

-------> Creating a format and time: Will upload ideas before 7:30pm (if post is not available, check it the next day before 9am) just so things will be predictable with me.

Format: PSEI daily/weekly (on mondays) + stocklist
Updates on any recommendations before
Interesting stuff found from everywhere + rants + opinions etc.

When do i start this format? hmm... i'll try to start it today, tell me if it works.

Some segways:
Drank lots of alcohol for my sister's party, threw up, slept late, watched movie atonement, been a sloth. Still went to church, ate more, bought books, played basket and won.woohoo. sloth after then thought about money matters. and writing ......after chatting and doing lots of unproductive stuffs.

A. PSEI Weekly Outlook

- PSEI is biased downwards and still has 130 pts more downside from its present 3080 closing price last Friday to test support of 2953 (previous low last Jan 22, 2008)
- still in the negative MACD region, don't fool yourself thinking we can be more bullish because of the rally of the DOW last friday. Even if DOW closes high when my eyes close tonight, if it's not more than 1%, I wouldn't believe it.
-RSI has further downside. Volume still thin

Last Friday's market action especially with the heavy selling of MEG, GLO, RLC , AC just to name the few blue chips that were really hammered is to me just an appetizer, to what's coming ahead. I like to analogize the market's action similar to a game of chess. Weaker pawns are sacrificed first, the king/queens will be the last to fall to confirm that the kingdom is lost.

Anyway, I didn't want to be so metaphorical about it but TEL (king of our PSEI with the highest market cap) is still at 2840. If you think we're bottoming out, we're not. Perhaps when TEL moves back to around 2500-2600 levels, then maybe, but we still don't know. If you look at the bishops and queens, they're quite getting there. GLO is going back to its support of 1450 or maybe 1405? for the bigger triangle?, RLC going back to its support of 11.25 (which i think is prone to be broken, cross fingers.). AC going back to 430/415. MEG either stays afloat in the 2.20 to 2.44 range or floors down to 1.95 support.

My opinion: if you're in cash, good for you. Place a watch list on the blue chips. Buy gradually and cautiously. Go for defensive natures. I like TEL @ 2585, GLO @ 1405/1450, AC @ 430. Wait for a successful bounce before entering.

If you're in a position- look at charts, do ur own homework. Check if your trades are weak and have to be lightened. If you think they are ones that can be bought more (once it bounces from support.) by all means, do so. For me, there's a distinction between averaging down a losing stock , which you clearly know is losing, and a stock that has shown a reversal. It's just that we tend to notice our favorite stocks doing the reversals.

My belief: Sell the rallies. I read Jensen's weekly on psei and he (from has a chart drawing that shows PSEI might be entering a head and shoulders bottom which is bullish. To me, it's quite too early to tell. I'd wait things out to play its own pattern for a while. I won't want to enter too soon. Though I don't think he is recommending any buys for the moment, the drawing is left to be a guide that things may go up from a technical bounce of the support. I believe this is the case when TEL and the heavy weights bounce from support.

For tomorrow: I think if DOW closes positive tomorrow, take advantage of market strength to exit positions. Raise cash and buy the dips which I think can come anytime this week.


Selected Stocks: TEL, AC, GLO

Rationale: I want to concentrate on the big blue chips. Just my personal view on betting on the strong ones. Inspiration comes from this simple quote:

"The race is not always to the swift, nor the battle to the strong, but that's the way to bet."- Damon Runyon

If there is a technical bounce, then i'm gonna bet on what I perceive to be the strong ones in PSEI. I've had it with basura stocks haha. - I sound so bitter. I'll update on the basura Angping stocks nextime. oks?

1.) TEL - box pattern
Entry: Successful bounce from Jan 22 lows, around 2500-2585
Cut loss- intraday penetration on Jan 22 lows or a close below Jan 22 closing price.
Target: 3000/2800
Potential upside: whopping 12.5% to 25%
Observations: Expectations of another voltes V

2.) GLO - box pattern
Entry: Successful bounce lows, either around 1405 or 1450?
Cut loss- intraday penetration on lows
Target: 1605
Potential upside: More than 10%
Observations: Expectations of another technical bounce

3.) AC- MACD Bullish Divergence

Buy: Accumulate at 415 to 430 levels
TP: 530 ( di ako nakainteractive charts kaya di exact)
Cutloss - as much as possible, I think you only cut loss when it falls lower than the support made last August 17. I recommend though not to cut. This can be seen as either a short term / medium term position entry.

Potential upside: For short term: could be around 20%, For medium term, greater than 20% - prone to volatility though.


I wanted to share more on the "animal menagerie" that i saw in a book. Kwento ko tomorrow inaantok ako tas early gising eh. byee

sneak peak :

Bulls earn money, Bears earn money, Pigs get slaughtered.

Lesson of the story: Greedy pigs die in the market. But greed is we will introduce the wolf in this animal menagerie tomorrow. see ya.

- Nix

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