For those who weren’t able to make it to the Absolute Traders event “BULL pa ba or BEAR na ba???” last Friday, here are the stock picks I presented just to keep you posted.
Before anything else, LaidTrades want to congratulate Absolute Traders for organizing the event, the speakers who presented their outlook in the financial markets and everyone who joined. Cheers to the very helpful insights, great food and awesome people!
Anyway, let’s begin with my technical analysis on the 7 Philippine stocks I chose. Let’s do this alphabetically…
DMCI Holdings Inc. (DMC)
I’ve heard many people say that DMC stocks are too expensive at the current level. That may be true but I somehow disagree with it as far as my technical perspective is concerned. As you can see, its 1-year uptrend is well intact and as long as the stocks move this way, I’d stay bullish on this. However, if the uptrend breaks then that’s a different story. On the side note, there could actually be a possible cup and handle pattern forming and a break above the neckline could move the stocks to the PHP48.00 price mark. I got that target by adding the cup’s height to the possible breakout point. However, it’s just the cup we’re seeing right now and no signs of the handle yet. In that case, I’d stay on my toes and wait for the handle before making a trading decision.
Energy Development Corporation (EDC)
I already had an analysis on EDC before it broke out from the symmetrical triangle pattern (kindly check this). For last Friday night’s event, I just had to point out that the current price could be a strategic entry if you’re the type of trader who likes going for the “return move strategy”. Well basically, one way of applying this is by buying at the resistance-turned-support from stocks that broke out. In EDC’s case, it broke out from a symmetrical triangle and went back down just sitting right at the resistance-turned-support of the triangle. EDC closed last Friday’s trading session with a white candle and this could be a good buy signal. In case I’d enter around PHP6.00-6.10, I’ll place my stop loss below PHP5.95.
Manila Electric Company (MER)
Meralco last Friday broke out from a 2-month double bottom formation with its 8.2% gain as if the 0.25 interest hike in the Central Bank of the Philippines never occurred. The higlight for this stock pick is the possible large cup and handle pattern forming. We can clearly see the cup but we’re still waiting for the handle to be made. If the stocks break above the possible cup and handle’s neckline, I’m seeing PHP420.00 as the target price. In case I’d enter now, my stop loss is placed below the 4-month uptrend.
Metro Pacific Investments Corporation (MPI)
MPI could be consolidating to a cup and handle pattern as well. However, before it gets confirmed, we need to see this break above the neckline of the said pattern. In case it does, a PHP6.5 target price is achievable. If I am to enter now, my stop loss is placed below the 1-year support.
NiHao Mineral Resources International, Inc. (NI)
I included NI on the list as the current price could be a strategic entry. If you notice, NI is right at the support of the 1-year trading range. If you’re the type of trader who likes buying on supports or bounces then this could be a good one for you. In case I’d enter this, I’ll place my stop loss below the support of the trading range because if the stocks go below it, that’s more likely a breakdown and I don’t want to be riding that so I might as well just cut right away.
Philex Mining Corporation (PX)
PX hasn’t been hitting the spotlight recently as it’s just moving sideways. But in the process, it could be consolidating for huge upside. There could be a 7-month symmetrical triangle forming that could serve as the handle of a 1-year cup and handle looking pattern. A breakout from the triangle’s resistance could propel PX to my target price of PHP19 but if you’re looking at the cup and handle, a break above its neckline could shoot the price up to the PHP24.00 target price if you’d ask me.
TKC Steel Corporation (T)
TKC Steel Corporation is the publicly listed company I’m really watching out for. After its initial public offering (IPO) last 2007, the stocks slid then moved sideways for 3 years to which could be big symmetrical triangle, triple bottom, inverted head and shoulders or whatever pattern you may want it to be. The main concern here is, if the 3-year resistance breaks, then we can see a huge upside. If we add the height of the consolidation’s base to the possible breakout point, I’m seeing the PHP8.00 price mark as the target. At the same time, its volume has been picking for the past 4 months and the stocks have been trying to breach the PHP4.50 resistance of a possible triangle setup. If that hurdle breaks then the march towards the PHP8.00 target will follow up next.
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