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FSL Trust: That sinking feeling.

Thursday, May 20, 2010

FSL Trust's price is being battered for losing a big part of a 15% income from a long term charter.  If we think about it, proportionally, its unit price should not lose more than 15% as well. However, from a price of about 60c just before the news was made known, it has plunged to close at 44.5c today. At one point, it reached a low of 42.5c today.



MFI is in oversold territory.  OBV is still declining. However, the price decline in the last 13 sessions show clearly a pattern of low volume pullback.  The fundamentals notwithstanding, I sense an opportunity.  I would be very tempted to buy some at the 138.2% Fibo line which approximates 41.5c.  If the price should go as low as the 150% Fibo line which approximates 39c, I would probably get some.

Related post:
FSL Trust: A sinking ship?

4 comments:

Drizzt said...

buying opp?


drizzt

AK71 said...

Hi Drizzt,

Ideally, I would like to see it forming a base first or maybe recover and retrace, forming a higher low.

If I do buy at 41.5c and/or 39c, these would be a hedge based on a gut feeling that the selldown is overdone. This is riskier, of course. My purchase earlier this month at 52c was a hedge which didn't turn out well. ;p

Drizzt said...

judging by waht is happening now we might see more irrational pricing.

AK71 said...

Hi Drizzt,

I agree. Hopefully, we could profit from the irrational behaviour in the market. ;)

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