November 16 Report

Market Commentary

I try to keep the market commentary short and sweet because you can read the recap in broadsheets or on their online editions anyway. What I seek to do with the market commentary is to highlight what caught my eye, and potentially, what we can make a profit out of on the next trading day.

I hate writing on Fridays because you have the weekend factor. Whatever recommendation I would say would be useless if the DOW crashes tonight and if something happens again over the weekend.

At this point, the DOW futures are flat and point to 13,160. The DOW will always be the barometer by which the local market will want to track its performance with.

The BSP, as expected, cut its overnight rates by 25bps. However, that failed to entice the market. This is probably a sell on news. The PSEi closed weaker today at 3,598, down by -73 points or -1.99%. The market started drifting lower at the 1030AM mark.

You can blame BPI, TEL, AC, MEG and MBT for the decline of the PSE. Just take a look at these large caps:

BPI 62.00 -6.77%
TEL 3,015.00 -1.15%
AC 580.00 -2.52%
MEG 3.95 -4.82%
MBT 53.50 -4.46%

Blue chips have become blue cheaps as of late (except TEL). But don't ask me to buy just yet. I planned to buy MBT today, but when I saw the heavy selling of them foreigners, and the chart looking butt ugly, I postponed my purchase.

Our market just tracked the big cap Asian indexes namely Japan and Hong Kong - they were also down by -1.81% and -3.87% respectively. Our market is so damn small that if the foreigners bail out of the market, the local traders, and 'investors' would probably follow suit.

The top gainer today was DFNN. I braved today's bad market and made a day trade with DFNN. Happiness :-D

Don't ask me for rumors as I am not a rumor mill. I don't have any contacts with anyone, I heavily rely on my Technistock subscription.

Aside from learning TA from Absolute Traders, my subscription to Technistock has been one of my best investments this year. It's my investment in the stock market that isn't working at this point, haha.

DFNN might have some follow through on Monday so I'll keep an eye on this one.

Last week I mentioned that we might have a correction, well it happened. Is this a sign of further correction? Or are we entering a sideways movement from henceforth? As I've said, I'd rather a consolidation period than a further correction. It makes people jittery and bearish.

Let's revisit the PSE chart as of today's close. When I look at the RSI, we might make a technical rebound next week. Of course, this could just be my wishful thinking, as we will still depend on the almighty DOW come Monday. As long as there are corporate earnings reports coming out, and less negative news, fewer political brouhahas, and Jinggoy shuts up, I think next week could be a better week than this week's.



Based on this weekly chart, out market is lying precariously above the 30day moving average. The good thing is that, even with our week-long seesaw, we still managed to be above that 30 day. The reason why I'm saying there could be a bounce is that based on RSI, the index bounces back from those points (touching the blue line I drew). With the exception of August-Sept.

STOCK

I was going to do that for MBT. Good thing I hesitated. Foreign houses like Deutsche, JPM, CLSA and Daiwa sold it like there was no tomorrow. Even MEG went back to 3.95, although there wasn't much foreign selling.

Try to look at the following next week:

APO
DFNN
PA is still strong despite the solid postings of more than a hundred millions shares on the sell side on 0.225, 0.23 and 0.2235
LC should still be a buy. Those who sold were merely taking the profits and making the pullback of gold price below 800 as an excuse. Remember, LC was a breakout Wednesday. There is no resistance (based from what I saw on the chart).

FOLKS DEUTSCHE IS STILL A NET BUYER TODAY. +112M
ABN-AMRO is also a net buyer. +168M

STUCK

Tagal Bagal Grabeng 'Intay (Ticker TBGI). With the market correcting again, it has succumbed, finally, to 2.80 (-3.45%). Volume is still minimal though.

SUCK

(Still) ATLAS MINING!!!!!! However, with APO leading the way, there could be upside with this Suck.

Foreign selling of other foreign brokerage houses.

Splash Corp. Traders usually do a FLIP on IPOs on the listing date. What Splash did was a FLOP.

Definitely not sucky - the weekend. Enjoy the weekend folks. Remember always look at the big picture. As long as the fundamental background of a good economy sticks, our stock market should weather this. It's just more difficult to make money for a trader during consolidation phases.