Genting SP: An amazing run.

Genting SP has amazed me with its continuing upward move in price. Many punters must have made good money here.  Congratulations!

Volume has expanded for three straight sessions as price pushed higher.  The volume, although higher, is not dramatically so and there is, therefore, a suggestion that price could be rising from a lack of sellers and not because of an abundance of buyers. The MFI has just joined the RSI in overbought territory and the risk of going long at this point in time is surely higher. OBV shows consistent accumulation and it seems that the party could continue for a bit more but when would it come to an end as all parties do? No one knows and I would advise caution.

Related post:
Genting SP: Twin spinning tops.

Genting Singapore rises to record on earnings outlook
Wednesday, 01 September 2010

© 2010 - The Edge Singapore

SPH: Another white candle.

My favourite blue chip is in top form and has been advancing for several days in a row.  Today, another white candle was formed as price closed at the high of $4.13.  Could we see a retest of $4.20?

Some analysts are saying that there could be a bumper dividend and that is driving accumulation.  Some people are saying that it is just quarterly window dressing and that it is just a blip.  Which camp is right?  I don't know but volume has been pretty high in the last two sessions as MACD formed a bullish crossover and rose in positive territory. The MFI has formed an almost straight line up and seems set to cross into overbought territory in the next session. RSI has already peeked into overbought territory.  OBV, although rising, does not show very strong accumulation activity.

What would I do? If SPH does retest $4.20, I expect that to be a strong resistance as many who missed selling then would sell now.  So, I would sell some at $4.20 and buy back if price retraces to the 20dMA.  Good luck to fellow shareholders.

Related post:
SPH: Doji at $4.00.

SPH +0.7%; More upside as bumper dividend eyed: UOB
Wednesday, 01 September 2010

© 2010 - The Edge Singapore

Golden Agriculture: Breaking out.

Yesterday, I mentioned Golden Agriculture's "next resistance is at 57c. This is where we find the declining 20dMA and the downtrend line." Today, it broke this resistance level in a most convincing manner as volume expanded significantly.  Price touched a high of 58.5c before closing at 58c.

58.5c is a many times tested resistance level and one wonders if this could be taken out as we eye 62c, the longer term resistance which I said could possibly be tested.

Technically, chances are good with both the MFI and RSI rising strongly. Being at around 50%, they are nowhere near overbought and they could go much higher.  The OBV shows accumulation.  The MACD seems ready for a bullish crossover.  Most importantly, volume is the fuel that drives rallies and this has been increasing nicely.  Let us see if this continues to be the case.

Related post:
Golden Agriculture: Moving higher?

China Hongxing: Immediate target in sight?

On 27 August, I mentioned that "China Hongxing's volume expanded today as it retested resistance at 17c. Unlike in early August, the technicals are now looking much stronger and China Hongxing's share price could break 17c this time round."  Today, China Hongxing closed at 18c on high volume.

The MACD has completed a bullish crossover in positive territory. The MFI is rising, forming higher lows, suggesting strong demand and it is nowhere near overbought yet. OBV shows no sign of distribution and accumulation is powering ahead. RSI is just peeking into overbought. Overall, the immediate target of 19.5c identified on 27 August seems attainable.

Related post:
China Hongxing: Retesting resistance.

Saizen REIT: More insider moves.

A substantial shareholder of Saizen REIT, V-Nee Yeh, increased deemed interest in Saizen REIT from 20.201 % to 21.976 % (209,572,352 units).  This is a consequence of the open market purchase of units by ASM Hudson River Fund,  ASM Asia Recovery (Master) Fund and HC Capital Limited.

AND

Chang Sean Pey, CEO of Saizen REIT, converted 842,000 warrants into 842,000 new units.  He now holds 2,200,000 units of Saizen REIT.  This is 0.23% of total issued capital.

The percentage figure of issued share capital (after the transaction) was calculated based on Saizen REIT’s total issued 956,304,205 units as at 30 August 2010. It should also be noted that Saizen REIT had 490,053,212 warrants outstanding as at 30 August 2010.

Related post: 
Saizen REIT: Insiders buy.

Healthway Medical: A low of 16c.

On 17 August, I mentioned that "there is a chance price could decline further.  If it happens, the next support is at 16c." Price touched a low of 16c today on moderate volume.  16c is also where we find the rising 200dMA today. Could this support hold?

The MFI has formed lower highs which suggests weakening demand but it recently emerged from the oversold territory which suggests the return of some demand, although weak.  The OBV does not show any drastic distribution activity while the RSI continues to decline in oversold territory, suggesting that the selling might be overdone.  Lacking in positive catalyst, this counter's price could, however, trade lower.

Taking a look at the weekly chart, we see the 50dMA at 15.5c and this would be a stronger support.

Related post:
Healthway Medical: 17c support.

Golden Agriculture: Moving higher?

The fundamentals of CPO remain good and the recent price weakness in Golden Agriculture was accompanied by rather light volumes. Price broke resistance at 55.5c in today's session and closed at 56c.  55.5c is where we find the 50dMA.  Next resistance is at 57c. This is where we find the declining 20dMA and the downtrend line.  If this resistance level is taken out, we could possibly see the longer term resistance at 62c retested.

The MFI is rebounding from a low while the RSI has risen out of the oversold region. The MACD's decline in negative territory has halted and it is pointing slightly upwards.

Aug 31: Golden Agri, Kim Eng, Yangzijiang, Ezra. Crude palm oil for November delivery increased 1.1% in Kuala Lumpur yesterday, extending its three-day advance to 3.4%.
Tuesday, 31 August 2010

© 2010 - The Edge Singapore

Related post:
Golden Agriculture: Breaking the 200dMA.

Saizen REIT: Insiders buy.

Mr. Raymond Wong Kin Jeon, a director of Saizen REIT, made open market purchases of 2,584,000 units which bumps up his deemed stake from 1,262,100 units to 3,846,100 units. The units are held under HSBC (Singapore) Nominees Pte. Ltd.

A substantial shareholder, Argyle Street Management Limited, made open market purchases which increased its deemed stake from 166,340,912 units to 175,048,912 units.  Kin Chan, who is the beneficial holder of more than 20% of the issued share capital of Argyle Street Management, increased the stake further to 177,469,217 units.  This is 18.609 % of the issued capital of the REIT.

The percentage figure (after the transaction) is calculated based on Saizen REIT’s total issued 953,657,355 Units as at 27 August 2010. It should also be noted that Saizen REIT has 492,700,062 warrants in issue as at 27 August 2010.

Related post:
Saizen REIT: Better than expected DPU.

Tea with AK71: Bought an iPhone 4, almost.

I am an techno dinosaur.  Till today, I do not know how to use Excel.  When a reader asked if I would consider starting a Tweeter account, I couldn't figure out the reason why I should start one. At a recent visit to a customer's shop, one person asked how many in the room had an iPhone and I was the only one who did not answer in the affirmative. Why an iPhone? Maybe, I am an endangered species.

A few weeks ago, I read that people were selling their iPhone 4s at $1,300 to $1,400 at Sim Lim Square! They would re-contract, get their iPhone 4s and sell them for a quick buck.  Does it really work? Recently, my contract came to an end and remembering what I read, I went to Singtel to see if I could get an iPhone 4 and, perhaps, make a quick buck in the process too.

Here's the deal: I had to pay $480 for a new iPhone 4 and upgrade my plan which means paying an additional $20 per month.  I did some math. It worked out to be $480 + $20*24 = $960.  I figured if I could sell the phone for $1,300, I would make $340 right away!  That's not bad.  So, I told the salesman I would take the iPhone 4. 

The salesman gave me a look, that kind that suggested he had seen my type before. Was I that obvious? Maybe, I took too long to do my mental sums.  He asked in a voice that sounded rather bored if I had made a reservation.  A reservation?  Yes, apparently, we had to make a reservation to get an iPhone 4 as there was a long line of people waiting! 

Wow!  Apple is definitely rolling in the dough.  This is the best kind of business to be in, goods are presold and no stocking is required.  A HTC or a Samsung and I would not have to wait.  Nokia only came to mind belatedly.

Anyway, I went ahead and made the reservation after being advised that it would take about 3 weeks before I could get the phone.  I then found out that evening that the price of the iPhone 4 had fallen to $1,080 in Sim Lim Square.  Apparently, the price was very high weeks ago because of shortages.  The supply is not so tight now.  I was too slow. 

I could still make $120 at $1,080 but the price could drop more in another 3 weeks while I waited for my phone. Sheesh! So much work for so little profit plus lots of uncertainty thrown in.  I will stick to a free phone.

Invest in Asian equities and inflation is here to stay.

Invest in Asian equities and forget US Government bonds (Marc Faber on CNBC, 16 Aug 10):



Inflation in Asia is here to stay.  0.125% per annum in interest payment from savings accounts in Singapore banks will erode your wealth:



Related post:
Grow your wealth and beat inflation.

Marc Faber is right again.

"More quantitative easing by the US Fed in September or October", Faber predicted in July, 2010:



It seems that Dr. Doom is right again and it is probably good news for equities:



The Fed "will do all that it can" to support the economy, he said, including "provide additional monetary accommodation through unconventional measures if its proves necessary."

At the top of Bernanke's ‘tool box' are "additional purchases of longer-term securities," including Treasuries and mortgage-backed securities. 

Posted Aug 27, 2010 01:35pm EDT by Aaron Task


Oh, stay away from long term US Government Bonds and buy some gold and silver (Marc Faber on CNBC, 16 Aug 10):




Related post:
Marc Faber: S&P will not fall below 1,010.
Gold: To buy or not to buy.

Hock Lian Seng: Steady accumulation.

Hock Lian Seng's share price retested resistance at 30c. That a gravestone doji was formed in the process suggests that there are many willing sellers at the current level. However, look at the OBV and we see a picture of steady accumulation.  The MFI has formed higher lows which suggests strengthening demand.  So, the sellers at 30c will probably be taken out in good time.

The 20dMA continues to rise and could provide immediate support at 29c.  Breaking 30c resistance would give an immediate target of 31.5c.

SPH: Doji at $4.00.

SPH's price action formed a doji, closing at the $4 resistance level. With the 20dMA still declining and the MACD in negative territory, there is a chance that price could continue lower in the next week.

The MFI has been forming lower highs and the recent uptick in price could be a weak rebound, therefore. For sure, OBV is lacklustre and does not suggest any accumulation activity. Immediate support is found at $3.92, as provided by the 100dMA although a stronger support is at $3.80 or so, which is where we find the 200dMA.  Judging from the high of $4.20 on 30 July and the current resistance of $4.00, $3.80 is also a technical downside target in case of a continuing decline in price.

Feeling the stress in Singapore?

"Singapore, one of the world's richest cities, has a land area of just 710 square kilometres (274 square miles) but until recent years, it had avoided the congested feeling of places like Hong Kong and Tokyo.

"Widely acclaimed as one of the world's most "liveable" cities, Singapore is now experiencing urban growth woes as it moves to expand its population to 6.5 million in 20 years, up 30 percent from the current level of five million."

Some facts:

1.  Tourist arrivals surpassed the one million mark in a single month for the first time in July 2010.

2.  Despite increased train frequency during peak demand periods, trains were more cramped than before.

3.  As of July, there were 936,311 vehicles plying the roads of Singapore, with cars accounting for 61.5 percent of the total, compared to 755,000 vehicles just five years ago.

4.  Demand for homes in Singapore's public housing blocks, where 80 percent of the population reside, is also straining supply. Foreigners who enjoy permanent residency and are eligible to purchase public housing totalled 533,000 in 2009, a 37.8 percent increase from 2005.

Read the full article here.
Singapore shows signs of urban stress.
AFP, Wednesday, 25 August 2010.

Raffles Education: Downtrend in force.

Raffles Education's downtrend continues. Distressed shareholders must be wondering if there is any end in sight. 29.5c is where we find the merged 20d and 50d MAs. This level was previously a support and is now resistance. Volume expanded as price drew to a close at 27.5c in the last session.

The MACD is declining in negative territory.  Momentum is clearly negative. After enjoying a brief period of accumulation from 26 July, distribution activity which started on 11 August has wiped out all gains in the OBV by the end of the last session.  Traders who were nimble enough to offload at 31c before the distribution activity took hold would have made a gain assuming they bought in at 29.5c.

Raffles Education's downtrend is in force and it would take a brave punter to try and make money trading this counter. Selling on rebounds is the strategy to adopt here, at least until there are clearer longer term reversal signals.

Related post:
Charts in brief: 16 Jul 10 (Part 3).

Genting SP: Twin spinning tops.

No matter how bullish analysts might still be about Genting SP, I believe that taking some profit off the table for anyone who is still vested is the prudent thing to do.  Yes, the MFI is still uptrending and OBV shows accumulation.  However, take note that the RSI is in overbought territory and has formed a lower high.  This suggests that the buying momentum is weakening and being overbought, it has to be corrected in time.

The MACD is still rising above the signal line in positive territory but notice how the distance between the two lines is narrowing. Another cautionary signal could be found in the candlesticks formed.  We have twin spinning tops formed in the last two sessions, a sign of indecision and doubly so.  Indecision in an uptrend?  Doesn't sound positive, does it?  Also, notice the huge decline in volume as the counter tries to hang on to its gains.

Genting SP's price seems to have support at $1.50 but gaps are more often than not filled.  So, we could see price touching $1.46 in case of weakness.  From the chart, it is clear that the top of the base formation could be found at $1.30 and this is also where the rising 50dMA would approximate soon.  In case of a dramatic decline, expect strong support at $1.30, therefore.

China Hongxing: Retesting resistance.

On 13 August, I suggested that the immediate support was at 14.5c and anyone who bought some in the sessions which saw a low of 14.5c would be laughing to the bank right now.

China Hongxing's volume expanded today as it retested resistance at 17c. Unlike in early August, the technicals are now looking much stronger and China Hongxing's share price could break 17c this time round.

The MACD has turned up and is poised to form a bullish crossover with the signal line in positive territory. Unlike in early August, the MFI is not in overbought territory now and, this coupled with the higher low formed, bodes well for the counter.  Look at the OBV and we see a picture of gradual accumulation.

Overcoming resistance at 17c gives us an immediate target of 19.5c.  Good luck to readers who are vested.

Related post:
Charts in brief: 13 Aug 10 (Part 1).

Golden Agriculture: Breaking the 200dMA.

CPO at RM2,543 and Golden Agriculture's share price is at 53.5c. The 200dMA is at 54c and closing below this MA is bearish.  The question to ask is could this bearishness be short term in nature.

Although the MFI's dramatic decline has continued, signalling a rapid fall in demand, it is bordering on oversold.  The RSI has, in fact, plunged into oversold territory, suggesting that the strong selling pressure might be overdone.  Looking at the OBV, we do not spot any heavy distribution activities.  This suggests that the selling could be by weaker holders.  In fact, look at the volume and we realise that, although higher than the previous three sessions, it is not dramatic.

Drawing upon the gentlest of uptrend lines from the low of 25 May, we find the next support at 52.5c.  Look at the weekly chart and 52.5c is where we find the 50wMA and this has proven to be a reliable support before.  Very interestingly, look at the MFI and RSI in the weekly chart. They are rising and as price fell in the last three weeks, the MFI continued rising. If price bounces off 52.5c, we could have a reversal on hand.


"Palm oil prices must rise to around MYR3,000 ($955) a metric ton to curtail demand for exports, as bouts of bad weather have limited palm production growth in Indonesia and Malaysia, the world’s top palm oil producers, leading vegetable oils analyst Dorab Mistry said Thursday evening. 

"Global consumption of vegetable oils for food and biofuels will likely grow by 6 million tons during the year to March 2011, while growth in supply of those oils will likely be a dismal 2.3 million tons due to adverse weather around the world, Mistry said in a speech prepared for an industry conference in Belem, Brazil."

-By Shie-Lynn Lim, Dow Jones Newswires;
August 26, 2010 09:00 ET (13:00 GMT)

Saizen REIT: Better than expected DPU.

Saizen REIT reported full year results this morning and declared a DPU of 0.26c, payable on 29 September 2010.  This is better than expected as the REIT did not have a full quarter to accumulate cash for distribution.  They also refinanced GK Choan and had to pay some fees as well as amortise that loan.  Read about it here. 

So, I was expecting a smallish cash distribution of about 0.1c in September.  Instead, a DPU of 0.26c in September, given the difficult conditions, bodes well for the next DPU in December which would have a whole quarter to accumulate cash for distribution to unit holders.  I estimate the DPU in December to be between 0.4 to 0.5c.  Assuming it is 0.4c, that would give an annualised DPU of 1.6c and an annualised yield of 10% at the current unit price of 16c.

Some key numbers from the reports:

1.  Annual valuation of properties (161 Freehold buildings in Japan) declined 4% from a year ago from JPY42,051.1m to JPY40,381.7m.  The rate of decline has slowed and this is in line with the general view that real estate prices in Japan are bottoming.  Read valuation report here.

2.  NAV is still at 40c per unit given the strong JPY.  The JPY is likely to stay strong, given the concerns of weak recoveries in heavily indebted western economies.

3.  NPI yield at 6.7%.  This is above the average of 5% that is required by most pension funds.

4  Gearing level at 36.9%.  This is quite comfortable.

5. Occupancy rate at 91.3%.  This is Saizen REIT's strength as it was able to maintain an occupancy rate of above 90% even through the recession.

Read full report here.

The one last thorn in the sides of Saizen REIT is the CMBS for YK Shintoku.  A punitive interest rate of 7.07% is still being paid to the bondholders.  Successfully refinancing this CMBS with a conventional bank loan at a more reasonable interest rate of about 4% would bring about substantial cost savings and could bump up DPU significantly.  This would be a major positive catalyst for Saizen REIT's unit price to be revalued upwards when it happens.

Discussions with a financial institution on the terms and timing of a loan, which will potentially enable the loan of YK Shintoku to be refinanced, have commenced. Currently, the main impact of the maturity default is the increase in interest rate on the outstanding loan amount from 3.07% per annum to a default interest rate of 7.07% per annum.

I am happy with Saizen REIT's results and look forward to a higher DPU in December.

Saizen REIT's slides presentation here.

Related posts:
Saizen REIT: 3Q FY2010 results.