The email address in "Contact AK: Ads and more" above will vanish from November 2018.

PRIVACY POLICY

FAKE ASSI AK71 IN HWZ.

Featured blog.

1M50 CPF millionaire in 2021!

Ever since the CPFB introduced a colorful pie chart of our CPF savings a few years ago, I would look forward to mine every year like a teena...

Past blog posts now load week by week. The old style created a problem for some as the system would load 50 blog posts each time. Hope the new style is better. Search archives in box below.

Archives

"E-book" by AK

Second "e-book".

Another free "e-book".

4th free "e-book".

Pageviews since Dec'09

Financially free and Facebook free!

Recent Comments

ASSI's Guest bloggers

STI: What now?

Saturday, January 30, 2010

In reply to a question from a visitor to my blog, Anthony, on whether the decline in the STI is the beginnings of another bear market, I said, "We will have to pay attention to the trend. The STI, despite its current weakness, is still trading above the channel support. The uptrend is intact. The market is just going through a much needed correction."


I have drawn the channel resistance and support in brown color here.  We see how the price action yesterday formed a white spinning top with the high of the day resisted by the 100dMA.  Index movement stayed within the confines of the up channel.  We now have to see if the reversal signal is confirmed next week.  MFI is still declining, indicating a weakening buying momentum and the index seems poised to enter oversold territory as a new low is inevitably formed.

If the STI does break down, there is some way to fall and I expect the rising 200dMA to provide some support.  That is at 2,550 thereabouts next week.  I have also identified two support levels in red based on candlesticks support and resistance.  Let us hope we never have to test those levels.  Then again, Mr. Market pays scant attention to our hopes.

Healthway Medical: Dwindling volume.

Friday, January 29, 2010

Healthway Medical closed at 16.5c after touching a low of 16c on the back of reduced volume.   Without any significant expansion in trading volume, any upward movement in price is likely to be unsustainable.  In fact, the chances of a downward drift in price is a more likely scenario when volume dries up.

The interest in Healthway Medical's rights also hit a low note today as the price touched an intra day low of 7.5c.  This is a far cry from the first day of trading when it traded as high as 9.5c!  This also means that the purchasers of these rights would be able to own more Healthway Medical's shares at only 15c after paying another 7.5c by 9 Feb 2010, the deadline for the acceptance and payment of the rights.  Why buy the mother share at 16.5c then?

Personally, I see 15c as an important XR support level, followed by 14c.  For anyone who is interested in owning more Healthway Medical's shares at this point in time, buying the rights at 7.5c seems like a better idea than buying the mother share.

DMG and Partners, who initiated coverage of Healthway Medical earlier this month and issued a buy call with a target of 28c has issued a new lower target of 21c yesterday.  They cited the enlarged capital base due to the new shares from the rights issue as well as a share placement exercise as the reasons for lowering the target price.  It may be coincidental but this gels with my XR eventual target price of 21.5c compared with my CR eventual target price of 24c earlier.

Golden Agriculture: Oversold.

Golden Agriculture closed above the 50dMA at 52c, almost forming a dragonfly doji, which is usually a bullish sign.  The MFI declined and dipped into oversold territory today.  We have the conditions for a possible reversal.  Any downside should be restricted by the 100dMA at 48c while initial upside resistance is provided by the 20dMA at 56c.  With all the longer term MAs still rising, although gently, the downside risk for Golden Agriculture seems limited for now.

With recent upgrades of the prospects of crude palm oil (CPO) by RBS Asia Securities and BNP Paribas for 2010, with the former going so far as to say that Golden Agriculture has a fair value of 71c, a floor for the counter at 50c is not unreasonable.

A quick peek at the weekly chart shows an imminent golden cross between the rising 20wMA and the descending 100wMA.  Spotting a probable reversal is always exciting and Golden Agriculture is making my heart beat a little faster.

Saizen REIT: Positive newsflow.

Saizen REIT's CEO bought another 100 lots at 16c yesterday.  Persistent insider buying is a hallmark of this REIT.  A positive development on its loan for YK Keizan has also eliminated the need to draw on a bridging loan which would have entailed considerable interest expense.  YK Keizan's loan would be fully repaid using only internal resources by April.

Saizen REIT closed at 15.5c today.  I might get my wish next week to buy more at this price.  If I am lucky, I might even get to buy more at the 100dMA.  This coincides with a longer term 38.2% Fibo line and is likely to be a strong support.  That's at 15c.

Saizen REIT will be presenting its results on 11 Feb, just before the Chinese New Year.  That gels with my chart reading on a probable breakout timing on the upside.  A narrowing of the Bollinger bands gives some credence to this reading as well.  Initial breakout targets remain at 19c and 21c for now.

Golden Agriculture: Reversal confirmed.

Thursday, January 28, 2010


Golden Agriculture closed at 52.5c, confirming the reversal signal given by the inverted hammer yesterday. The critical support at 50c held.  The MACD has a buy signal today with a green histogram after more than 2 weeks' worth of red ones.  MFI is at 29% and this leaves much room for its price to move up if indeed that's the direction in the next few sessions.

A new set of Fibo lines show resistance at 56c (38.2%) which happens to coincide with the 20dMA, 58c (50%) and 59.5c (61.8%).

I did not manage to get any at 50c, the critical support level, but that's ok as I have been accumulating shares of Golden Agriculture as its price moved downwards this and last week.

The fundamentals for crude palm oil remains compelling and I would accumulate shares of Golden Agriculture if its price weakens to supports instead of moving up in the near future.

Healthway Medical: Waiting for a pullback.

Healthway Medical closed at 17c on low volume and a declining MFI.  We can see from the line I've drawn on the MFI that the buying momentum did not bounce off the line which would have meant a strong follow through in the buying momentum.  Let us see if the rising 20dMA could push the price higher as the Bollinger bands begin to squeeze.

Trading volume has been on a downward trend since peaking in the first week of trading in 2010 on 7 Jan.  Conventional wisdom is that if volume does not expand meaningfully, any price movement upwards is unlikely to be durable, especially for a counter with a huge float such as this one.



Looking at the weekly chart gives a more sobering picture.  Healthway Medical's recent candlesticks are largely beyond the upper limits of the Bollinger bands and the MFI is firmly entrenched in the overbought region.  In fact, it is getting more overbought by the week.  I will wait for a pullback before accumulating more shares of this company.

Saizen REIT: Still accumulating



I am back in Singapore.  It's nice to have access to the internet without paying more.  It's also nice to be surfing the net with my big LCD screen.  Happy!

My overnight buy queue for Saizen REIT at 16c was filled today.  I would have liked to buy at 15.5c and I still have a queue at that price level.  However, I rationalised that it's only 0.5c.  No big deal.  I am still some way from the target I've set for myself in terms of the number of Saizen REIT units I want to have in my portfolio.  I'll buy in slowly at 16c.  If Saizen REIT does not revisit 15.5c, I would still be accumulating.

Saizen REIT's price action formed a graveston doji today.  I won't be too worried since there was only one trade done at 16.5c and only 7 lots were transacted.  16.5c is now resistance provided by the rising 20dMA.  The flat 100dMA provides support at 15c.  With the MFI forming a higher low, it shows the buying momentum, though weakened, is very much alive.

4 counters

Wednesday, January 27, 2010

Another down day for the STI as it closed just a few points above the 2,700 support.

Golden Agriculture closed at 50c which I've identified earlier as a critical support.  The black candle day took place with lower volume compared to the last session.  Price action formed a black inverted hammer which, together with the white inverted hammer, are considered possible reversal signals.  This has to take place after a series of down days which is the case here.  We will need confirmation tomorrow.  If the decline continues, the rising 100dMA provides near term support at 48c.

Healthway Medical closed at 17c, forming a dragonfly doji which is usually interpreted as a bullish candlestick.  However, this took place on the back of much reduced volume and a declining MFI which hit 50% today.  The buying momentum is broken but the declining MFI also gives more room for price to move upwards in the event of a reversal.

Q&M Dental is seeing its price retreat, closing at 49.5c, down from the lofty 60c not so long ago on the first trading day of 2010.  It should retreat.  I am not even looking at the charts.  Fundamentally, at 49.5c, it is still very expensive.

Saizen REIT closed at 15.5c, the support level provided by the 50dMA.  Both yesterday and todays' black candles were accompanied by relatively low volume. Rising 100dMA at 15c should limit downside.  15c is also a many times tested candlestick support and resistance level.  I have put in my buy queues.

STI and 3 counters

Tuesday, January 26, 2010

Asian markets made huge retreats today. HSI and STI are down by 2.38% and 2.54% respectively. The Shanghai Composite is down 2.42% while Taiwan is down by a whopping 3.48%! European markets are all in the red right at this moment.

Where are the supports for the STI? I identified two levels of support for the STI in a previous post. With today's close at 2,740, we are sitting right on the first level of support. Please see:. STI: How low can it go?

With the retreat in the STI happening with such magnitude and strength today, as could be seen in the high trading volume, the next support which is a band between 2,680 to 2,700 could be tested next.

Healthway Medical started the day at 18c only to touch a low of 16.5c before closing at 17c. MFI is declining which suggests that buying momentum is weakening. Price action is directionless at the moment at best.

Golden Agriculture closed at 50.5c as it crashed through the supports at 51.5c and 51c. My overnight buy queues at those levels were filled. The next support level is at 50c, a many times tested candlestick resistance turned support. This support level is critical. . We might see a whipsaw if this support level holds. The rising 100dMA is at 48c.

Saizen REIT's price action formed a solid black candle as it closed at 16c, below the rising 20dMA. My overnight buy queue at 16c was filled. The rising 50dMA will provide near term support at 15.5c next. The pullback is on relatively low volume with. the MFI declining to 50%. The fundamentals have not changed and I will accumulate at the next support level.

Healthway Medical, Golden Agriculture and Saizen REIT.

This is going to be a quick look at Healthway Medical, Golden Agriculture and Saizen REIT.  A quick look is all I might be able to do in the next couple of days as I am on vacation and the internet connection at the hotel is rather pricey. I am writing this after midnight after a nice night out.  I hope I am still writing coherently.

Healthway Medical closed at 17.5c on Monday, the same as the previous session last week.  It is showing resilience as expected.  However, the price moved to touch a high of 18.5c before closing lower.  This formed a candle with a long wick on top.  If you have been following my blog, you might remember that I dislike such candles.  Price is unable to close higher on a day with much higher volume.  Not too positive, you might agree.  OBV and MFI are flat, suggesting a lack of conviction either way.  The MFI is hovering under the overbought region and that suggests that any upside in the immediate term might not be very durable.  Fundamentally, I am not convinced that Healthway Medical should trade at anything higher than 18.5c which is what it is worth, post rights, if it trades at the same valuation as Raffles Medical Group, both in terms of PE ratio as well as P/B value.

Golden Agriculture's bullish reversal candle in the last session was not confirmed on Monday.  It has also formed a candle with a long wick on top which I dislike.  Price closed lower today at 53.5c.  However, unlike Healthway Medical, volume was much reduced yesterday with MFI declining to the 50% level.  At this level, there is more room for price to move higher if a reversal comes along.  Of course, MFI could continue to move lower and if the price decline stalls or moderates as this happens, it is actually a positive. OBV continues to decline but more gently, suggesting that distribution might be moderating. I would accumulate Golden Agriculture at the next support levels I identified in earlier posts.

Saizen REIT's price closed unchanged and it seems that the rising 20dMA is providing some support at this point in time.  Volume shrank while MFI continued its decline.  OBV has flattened.  What is interesting is the declining MFI.  This suggests a lack of buying momentum but if this continues to lower without any corresponding decline in price, it is actually a positive.  I would keep an eye on this.  Saizen REIT is still a counter I will continue to accumulate at supports.  This REIT, I firmly believe, is going to be re-rated upwards in time and when that happens, the market will recognise its value in the usual way.

Have a good Tuesday, everyone.

Grow your wealth and beat inflation

Sunday, January 24, 2010

In some interviews earlier in the year, Marc Faber said that the meteoric rise in global stock markets in 2009 was a once in a lifetime opportunity to make a lot of money and that 2010 should be a year of capital preservation (ie. not to lose money). Marc also said that, on average, it is still possible to get about 10% gain from the stockmarket this year.

People who know me would know that I have a lot of respect for Marc and I take his advice to heart. However, I believe that if we use fundamental analysis and choose to invest in companies with strong fundamentals that are still below their intrinsic value, coupled with technical analysis to determine fair entry and exit points, we could make more than 10% capital gain this year.
Stockmarket analysts.

Does this mean that we have to take on risk? Of course, there are risks involved. There is no free lunch in this world. Risk has to be managed, not feared. Easier said than done? After all, it's only human to feel fear.
Risks and rewards: TA and FA

Then, let this be an inspiration: "The rich would act in spite of fear. The poor would let fear stop them." I read this in a book while browsing in a bookshop recently. I cannot remember the title now. If we are petrified by fear, we would never do anything in times of adversity.  At the height of the bear market when the VIX was making new highs, when everyone was fearful of buying more shares, that would have been the best time to gradually accumulate shares of good companies.
Bungee jumping, anyone?

Convinced?  So, what do we do?  There are many suggestions by financial analysts on what to do with your money depending on your risk appetite and how to get better returns than fixed deposits in the banks. Frankly, to get better returns than fixed deposits is quite easy. A one year fixed deposit now pays as much as 0.8% per annum, the last time I check. There are also suggestions to leave our money in money market funds which pay 1.3% per annum, thereabouts. Lower risk than equities and higher returns than fixed deposits, though not guaranteed.

For me, the more important thing is how to get better returns that will protect us from the wealth erosion effect of inflation! A rather benign inflation rate could be about 3% per annum. So, if we leave our money in the bank, more than the contingency cash required for six months of expenses in case our regular source of income is terminated, we are doing ourselves a grave injustice with an interest of only 0.125% per annum in the banks. If we leave our money in a fixed deposit or a money market fund, our wealth is still shrinking as the returns lag inflation.
Be a pragmatist and prosper in 2010.

I wrote about capital gains and high yields in various articles in this blog.  I have shared my thoughts on inflation and investments in gold and real estate too.  On a daily basis, barring the days I'm away from home, I've shared my analyses on price movements of certain counters.  These analyses would hopefully contribute to capital gains.  It seems that I'm neglecting high yields.  After all, the theme of my blog is: "Have a more secure financial future in an uncertain world by creating a stream of reliable passive income with high yields." 
High yield portfolio.
Real estate as hedge against inflation.
Gold as an insurance against inflation.

I guess why I'm not writing as much about high yields is because they don't really have to be actively managed as much.  I am receiving dividends from a portfolio of high yields at this time on a quarterly, half-yearly and yearly basis, depending on the stock.  This is something which people who are relatively risk averse, who want to grow their wealth, fearing the effects of inflation could consider.

My portfolio of high yields at this moment include:
SPH
ST Engineering
Cambridge Industrial Trust
CitySpring
First REIT
FSL Trust
K-REIT
LMIR
AIMS AMP Cap Ind REIT
MIIF
Suntec REIT
HWT
Frasers Commercial Trust
Saizen REIT

These high yields are not all created equal and some were bought at prices I would rather forget.  Many, however, I am happy to say, I have purchased at much lower prices in the last twelve months.  The constant passive income they have provided me with makes me happier.

The profits I made from trading in the stockmarket, I make it a point to apportion some of it towards accumulating high yields.  The high yields I have been accumulating in the last few months were SPH, AIMS AMP Cap Ind REIT and Saizen REIT.  I have written extensively about these high yields.  So, I shan't say more here.
Passive income with high yields - Saizen REIT.
AIMS AMP Cap Ind REIT.
 
We have a responsibility to ourselves and the people we care for to have a secure financial future.  This is something we have to consciously work towards.  It is the responsible thing to do.  The journey is likely to be filled with obstacles but treat each one as a learning experience and grow with each step.  A good dose of luck doesn't hurt as well.  Good luck to us all.


Monthly Popular Blog Posts

All time ASSI most popular!

 
 
Bloggy Award