CapitaMalls Asia: Broke out of downtrend but still at resistance.

A white spinning top was formed on low volume in the last session. Closing at $1.93 is exactly at resistance provided by the declining 50dMA as identified in my last blog post on the counter.

The MACD has just completed a bullish crossover with the signal line but it is still in negative territory. Could we see it crossing into positive territory soon? The MFI's uptrend is intact as the trendline support was tested again. We will need to see price or volume (or both) improving in the next session to send the MFI bouncing higher.

Although the bias is for price to weaken, in case of a breakout, the next resistance levels to watch are the high of $1.97 touched on 17 Jan, $2.00 candlestick resistance and $2.04 which is likely to be a strong resistance as that is where the declining 100dMA would approximate soon. Price could also go higher because it has, once again, broken out of its downtrend, although on low volume.

Fundamentally strong but technically weak, taking profit as the counter experiences a rebound could be a good idea. I would reduce by selling some as resistance levels are tested and keep the rest just in case price does go higher.

Related post:
CapitaMalls Asia: Testing resistance.

Tea with AK71: A fishy CNY tale.

I went to my favourite malls again today. Parked at MBLM. Ate at Din Tai Fung, got complimentary parking for 4 hours and took a walk to MBS. A well planned outing is a happy outing.

Some were tossing raw fish (Yu Sheng) to usher in good luck and prosperity for the Chinese New Year,

while some followed the example of the Lord Buddha by feeding bits of themselves to some hungry fish. ;-p

祝大家新年吉祥!

First REIT: Buying more?

Some readers would remember that I announced a fair value of 80c per unit for First REIT. This was on 1 Dec 10.  In that blog post, I made the following comments and also did some calculations:

A friend called me yesterday and said he might buy into First REIT with a view of getting more excess rights. I gave him my full support and told him he is likely to make money in this exercise. It turned out that he didn't get any yesterday.

Assuming that he had bought 4 lots at 98.5c /unit, his average price including rights units would be:

98.5 x 4 + 50c x 5  /9 = 71.55c /unit

At the estimated annualised DPU of 6.4c for 2011, it would mean a yield of 8.94%.  Not bad.  If he managed to get 1 lot of excess rights later on, the average price would be 69.4c which means a yield of 9.22%! I like this.

Now, for people who divested their stake during CR when First REIT's price closed in on its then NAV/unit, is buying back at the current price of 76c silly? It would seem so as not selling their stake then would mean a lower average price now in the region of 70c to 71.5c per unit.  They would also have been eligible for excess rights which would have lowered their average price further.

Of course, buying more, increasing their long position, when the counter's unit price plunged to 66c XR would have been doubly rewarding.

However, recognising the strength of this REIT and believing that it is undervalued even at 76c, it might be a good move for some to invest in the REIT once more or to increase their exposure, whichever the case may be. This is from a purely FA perspective, of course.

Personally, I am not adding to my long position. Why? I have a sizeable exposure to this REIT with costs ranging from 42c to 96.5c. 42c? Yup, those I bought during the last bear market. 96.5c are those I bought when the counter went CR which are really 70.67c after taking into account the rights. So, unless the price is at a very attractive level, I have no compelling reason to buy more.

Now, I am going to look at the technicals which are looking interesting.

On the daily chart, right away, we see that the Bollinger Bands are squeezing. An imminent change in direction after a period of low volatility? Which way would it go? The MACD has been falling as a bearish crossover was completed sessions ago. Momentum is weakening. Immediate support is at 75c.

I turn to the weekly charge to look at the longer term technicals. A white spinning top 4 weeks ago was followed by a doji which was in turn followed by a hangman. All possible reversal signals. Certainly, price action has been pushing the upper band and seems to have grown tired. Lower highs on the MFI confirms the tiring longer term demand. Although 75c has been identified as the immediate support in the daily chart, see how the weekly chart suggests that strong support is at 72c? This is where the rising 20wMA would be approximating soon. Caution is advised. There could possibly be a better time to buy more.

I continue to believe in the strong fundamentals of First REIT but at 76c, given the current technicals, I am not a buyer.

Related post:
First REIT: XR and fair value.

Cache Logistics Trust: Weakness after XD.

Cache Logistics Trust went XD and the price gapped down, forming a big black candle, rebounding a tad as it hit support at 97c provided by 2 longer term MAs, the 100d and the 200d MAs. This is a familiar pattern. If we look at the candlestick of 3 Nov 10, it was the same story of weakness after XD. Could we see the unit price fall further? Quite likely. I have been waiting for a nice entry price for some time now. When to buy?

On 23 October 10, I said, "On 29 July, CLT was trading at $1.01 per share. This would give a yield of 6.77% based on an annualised DPU of 6.84c. Its unit price is now 98.5c, not much lower. That's unattractive for me although I recognise that it is a relatively safe investment." Read blog post here.

On 16 December 10, I went on to say, "With an annualised DPU of 7.76c, at today's closing price of 94c, the distribution yield would be 8.26%. Still not attractive enough for me but I recognise its strong numbers which would convince me to start a small long position if price would decline to test its historical low of 91.5c for a yield of 8.48%." Read blog post here.

Technically and on hindsight, 94c would have been a great entry price as price touched a low of 93.5c on 16 Dec and went on to touch a high of S$1 on 28 Jan. Fundamentally, I notice the annualised DPU increased from 6.84c to 7.76c. This is a strong passive income generator and the numbers show it. More than ever, I want a slice of the pie.

Now, 94c would stay in the heads of market participants. People like myself who were waiting for a retest of 91.5c would now wait for a retest of 94c instead before entering. Judging from past data, price could continue to weaken for the next 4 to 6 weeks. I am going to watch this as I definitely like this REIT for its strong numbers which justify the lower distribution yield.

The MACD in the last session completed a bearish crossover with the signal line while the RSI broke its trendline support as it falls further from the overbought territory. OBV is rather flat but definitely lower than  2H2010. Signs suggest that people currently vested in this Trust are strong holders investing for income. However, momentum is suffering as some are selling after the counter went XD. I shall wait and see.

Gearing: 23.7%
NAV/unit: 89c
Annualised DPU: 7.76c
Interest cover ratio: 9.3x

It is important to note that Cache Logistics Trust is currently paying out 100% of its income and this would come to an end in December 2011. From 2012, it would pay out at least 90% of its income. As an aside, AIMS AMP Capital Industrial REIT is paying out 97.1% of its income on 15 March (3Q FY2011).

See 4Q2010 presentation slides here.

Tea with AK71: Lucky 4D from ASSI.

In a blog post many moons ago, I asked if gambling was a bad thing. In that post, I said "From a money management standpoint once more, if we budget a small sum of money for entertainment and classify gambling as one form of entertainment, as long as we stay within what is budgeted, gambling would not become financially crippling and it might even be rewarding.  The Chinese people have a saying, "mai ge xi wang", or "buying a hope".  This, I feel, is not a bad thing." Read blog post here.

I have a habit of buying a few BIG SWEEP tickets every month. I would also try my luck at TOTO if the prize money is big enough such as the recent $5m TOTO.

Now, with the Chinese New Year coming up, perhaps I should try my luck once more! If we look at our telephones, we would realise that we could dial ASSI and the numbers are 2774. Could these be the lucky numbers for betting at 4D in the first week of the Chinese New Year?

Wishing all Chinese readers a Happy and Prosperous Chinese New Year! GONG XI FA CAI!

Just found this on YouTube. Not one of the traditional Chinese New Year songs. A mixture of new, old and funky! I like:

AIMS AMP Capital Industrial REIT: Buy at 21c.

I am still in the queue to buy more of this REIT at 21c. With an annualised DPU of 2.04c, buying at 21c would give an attractive yield of 9.71%. Technically, 21c seems like a strong support as well, underpinned by the 200dMA.

I like to use the MFI as a measurement of demand and it is heartening to see that the uptrend is intact although attempts by the index to rise have been resisted several times at 50% since 21 Jan. An expansion in volume as price pushes higher would see the index move higher as well. When would this happen? Your guess is as good as mine. Bear in mind that the index could weaken to retest its trendline support as well and this could happen if volume or price weakens, or both.

Informed by FA, I would simply accumulate on weakness. This was something written by OCBC Research a couple of months ago:

The industrial sector typically lags the office sector by a few quarters. With the upbeat momentum in the office space, Industrial REITs stand to capitalise on the spillovers to business parks, high-tech and light industrial buildings. In terms of forward yields, Industrial REITs also trade at a premium of 70 basis points to the broader sector. We are bullish on the industrial sector recovery and now have an OVERWEIGHT rating for the Industrial REITs subsector. 

Related post:
AIMS AMP Capital Industrial REIT: 21c at XD.

CapitaMalls Asia: Testing resistance.

Although volume was lower than the previous session, price managed to overcome both resistance levels at $1.88 and $1.90. We could see the resistance provided by the descending 50dMA at $1.93 challenged next. Indeed, it could be argued at price is now at resistance provided by a trendline resistance at $1.92. Overcoming this resistance could see a retest of $1.97, the high of 17 Jan.

The RSI has broken out of 50% and is rising higher while the MFI is now testing 50% as resistance. So, initial observation suggests that although buying momentum is recovering, demand is not very strong. This is a fragile condition which could see things go either way. However, drawing a trendline support yields a very interesting picture. The MFI's uptrend is actually intact!

That $1.83 is now a support of some strength is indisputable. Market participants would remember it as the support which did not break. If this were to be tested once more, I am willing to bet that more buyers would emerge. So, although the longer term MAs are still in decline, the gently rising 20dMA tells a story of possible reversal. Although I am not adding to my long position, I am not a seller either.

Related post:
CapitaMalls Asia: Support at $1.83.

CapitaMalls Asia: Support at $1.83.

CapitaMalls Asia gapped down, tested $1.83 support today and bounced off to close unchanged at $1.87. Although volume is pretty decent, it is lower than the previous session which was a black candle day.  The intra-day high of $1.88 was a many times tested support earlier this month and even if it should be taken out, the next resistance at $1.90 was also a many times tested support. This counter will have to climb a wall of worries, indeed, as supports are now resistance.

Although fundamentally strong, this counter remains technically weak as the MACD has just completed a bearish crossover with the signal line in negative territory. The MFI has also broken the 50% support to trend lower while the RSI is now resisted by the 50% line. Breaking resistance at $1.88 and $1.90 on high volume would give the counter a chance to retest resistance provided by the descending 50dMA.

Since breaking its nascent uptrend after breaking out of its multi-month downtrend, things are looking iffy. I am not adding to my long position until the technicals show that the uptrend is recaptured or a new one is formed.

Related post:
CapitaMalls Asia: Black hammer day.

Golden Agriculture: Resistance at 100dMA.

Golden Agriculture enjoyed a white candle day as price traded below the resistance provided by the 100dMA for most of the day. This white candle could be most misleading. In the previous session, although a black candle was formed, price closed at the 100dMA which acted as support.

So, am I saying that the share price would continue its fall in the next session? There is a good chance of this. However, due to the very steep fall in price in recent weeks, we could see the price moving higher to touch the trendline resistance which should be in the region of 73c in the next session or two.

TA is not about having a crystal ball and knowing exactly what would happen but TA is useful in that we would know exactly what to do if something happened.  So, in case price moved higher to 73c, I would reduce my long position. In case price moved lower, I would wait for it to go closer to the 200dMA at 63c before adding to my long position. That's my plan.

Related post:
Golden Agriculture: Testing 100dMA support.

STI off 1.3%; 3,090 worst case consolidation - DBS Vickers.

It adds, “equities remain one of the more attractive investment asset classes...in addition, the STI is not that far away from levels seen as attractive and where firm support lies.”

Monday, 31 January 2011

© 2011 - The Edge Singapore

Raffles Education: Correction?

The fanfare that pushed up the share price of Raffles Education to touch a many months high of 35c came suddenly and provided the counter with a sugar rush which is now dissipating. The trendline support was broken four sessions ago and it now remains to be seen if the gentler trendline support below the 20dMA would be tested next. This is at 30c.

If I were to hazard a guess, 30c is likely to be a strong support as that is the price which formed the top of a small bowl before a breakout took place. Market participants would remember the price: not buying then led to missing out on a nice gain in the following sessions.

The MFI and the RSI show that the overbought condition has been corrected. The RSI is actually declining towards 50% and it would be interesting to see if 50% would act as support. The MFI which takes into consideration volume on top of price has flatlined just below the overbought region. This suggests that demand, although weaker, is still strong. Look at the trading volume and we see a semblance of a low volume pull back taking place. Buy more?

For anyone who wants to go long on this counter, being patient and waiting to buy some at supports in an uptrend is a good idea. I never like chasing. I rather like waiting for things to come to me.

Related post:
Raffles Education: A new property play?

AIMS AMP Capital Industrial REIT: 21c at XD.

AIMS AMP Capital Industrial REIT went XD today. Price closed at 21c but if we look at the trade summary, 6,459 lots were bought up at 21.5c while only 197 lots were sold down at 21c. I believe that support is strong for this counter at 21c. Remember that 21c is also where we find the rising 200dMA, a longer term MA.

There is nothing fundamentally wrong with this REIT and I will accumulate on weakness. For now, I look forward to receiving the income distribution on 15 March 2010.

Related post:
AIMS AMP Capital Industrial REIT: 3QFY2011.

Singapore’s Straits Times Index dropped 1.6% to 3,179.72 at the close of trading, erasing this year’s advance. The gauge fell 0.3% this month. All but three stocks in the benchmark index of 30 companies fell.
Monday, 31 January 2011

© 2011 - The Edge Singapore

ASSI 2010 Annual Report.

I am somewhat late in doing this. Somehow, it slipped my mind. Someone reminded me and, well, this is the report of how my blog did last year as promised.

Page loads, unique visitors and returning visitors all formed new records in the month of December 2010. The numbers in the chart are kind of small as this is a full year report. Let's see:

Page Loads: 
52,493 (92.87% increase from January 2010)

Unique visitors: 
32,169 (166.98% increase from January 2010)

Returning visitors: 
15,643 (175.89% increase from January 2010)

I think there are many who would come in to check on what are my latest thoughts on a daily basis which probably explains the 175.89% increase in returning visitors as well as the more modest 92.87% increase in page loads. Most are regular readers who would probably have read my older posts.

Although I am sure my blog would never be as popular as Xiaxue's or Mr. Brown's, that the number of unique visitors increased 166.98% from January to December 2010 is very encouraging. 32,169 unique visitors in December means there were more than 1,000 unique visitors per day on average.

I have said this before but no matter how many times I say it, it would never be enough: I have no doubt that I have some very loyal readers who are spreading the word.  Your support is encouraging and you can bet that I will continue blogging!  Thank you. :)

Tea with AK71: First cheque from AdSense.

Not long after I started this blog in December 2009, I signed up with Google AdSense to serve ads in the hope of making some pocket money on the side. A few months later, I took down all the ad spaces. This was after hearing rather negative stuff about bloggers being "banned" with little chance of being reinstated. I didn't want to have the same experience. Could be quite depressing, I thought.

However, a couple of months ago, while chatting with a fellow blogger, I was advised to just put up the ad spaces for AdSense again and if I did get banned, then, too bad for me. If I got paid, it would be a bonus. Mentally prepared thus, I ventured forth with AdSense once more.

Today, as I was sorting through four days worth of mail, I found a cheque from Adsense! My first cheque from AdSense! It added some cheer to a wet Sunday. :)

Tea with AK71: What does a bundle of new notes look like?

What does a bundle of new notes look like? More specifically, what does a bundle of new S$2 notes worth a total of S$2,000 look like? Here are a few photos taken from different angles:

It was my first time seeing notes wrapped up in "MAS" plastic shrink wrap. Very official looking.

OK, how did it feel like? Felt like a brick, a heavy one too.

Maybe, I am just a mountain tortoise. ;-p