NOL: That sinking feeling.

NOL is definitely not for the faint hearted. Today's black candlestick with price closing at $1.93 was formed on the back of very high volume and it looks like the downward momentum is strong as the MACD formed a lower high in negative territory. The MFI is also on its way to form a lower low.

Technically, NOL is still in a downtrend which started on 5 Jan 2011. A continuing downward movement in price could see the channel support at $1.84 tested or, in very bearish situation, the lower limits of the MA envelope tested. Any attempt to move higher would meet with resistance at $2.02, a recent thrice tested resistance level. Good luck to all vested.

Olam: Channel trading?

Olam could be seeing the early days of trading within a channel. Continuing weakness in price could see support at $2.68 tested.

ADX has been declining and the downtrend has weakened. The MFI and RSI could both test 50% for support soon. The MACD continues to rise, although in negative territory. Underlying momentum is strong and there is demand. To verify this, today's black candle day was on the back of relatively low volume.

See if a picture of low volume pullback should continue. Buying at supports could be very rewarding if this were the case.

CapitaMalls Asia: Dual listing failed to excite.

News of the proposed dual listing in Hong Kong didn't send its share price higher. In fact, it closed lower at $1.74 after closing the gap at $1.72.

The ADX continues to decline and the downtrend has definitely weakened. This does not automatically mean that the share price is going higher. We could be seeing the start of rangebound trading too. So, is it time to buy more? The volume for half a day's worth of trading is quite high and I would not be surprised if there should be more downside. Immediate support in the next session is at $1.70.

I will see how the share price moves in the next few days. If a higher low in share price should be formed and if the technicals are supportive of a move up, I could possibly increase my exposure to this counter. There could be some near term weakness in this counter's share price but over a longer term, the prospects could be more benign.

Related post:
CapitaMalls Asia: Proposed dual listing in Hong Kong.

CapitaMalls Asia: Proposed dual listing in Hong Kong.

CapitaMalls Asia's trading halt early this morning made me wonder if the rumours of dual listing in Hong Kong for this company are true. I just checked SGX's website and have confirmation.

"CapitaMalls Asia wishes to announce its intention to explore a secondary listing in Hong Kong to complement CapitaMalls Asia's growth strategy in China. China currently accounts for approximately 37%1 and 70%1 of CapitaMalls Asia’s total property portfolio by property value and Gross Floor Area respectively. Given the growing importance of CapitaMalls Asia's China business going forward, the Directors believe that the Listing will complement CapitaMalls Asia’s expansion in the country and achieve its longer-term strategic objectives." Read announcement here.

Like with all dual listing announcements, it is reasonable to expect a spike in buying interest in this counter. The fervour could dissipate after some time but I would expect some positive movement initially. Resistance levels could possibly weaken and higher highs could be formed.

See slides proposing secondary listing here.

Related post:
CapitaMalls Asia: Moving higher.

AIMS AMP Capital Industrial REIT: Lower gearing.

AIMS AMP Capital Industrial REIT will see a lower gearing of 32% very soon. This is because their Japanese property has been successfully divested for a sum of JPY1.483 billion or about S$23m. Read announcement here.

Just two days ago, I suggested that at 20c/unit, this is a value proposition. Although, technically, the malaise is quite obvious, I went ahead and bought more at 20c and 19.5c as its price declined in the last two weeks. Fundamentally, as a cash flow generator for the next two years, it is almost bullet proof.

I am very much tempted to add to my position but my investment in this REIT has already surpassed Saizen REIT to become the largest investment in my portfolio by market value now. So, unless its price weakens further to a more compelling level, the prudent thing would be to refrain from adding exposure to it.

For others who are thinking of initiating a position in this REIT, well, evaluate the facts and see for yourself. See if you agree with me.

Related post:
AIMS AMP Capital Industrial REIT: Still bottoming?

Capitaland: To sell or to buy?

I read an article in The EDGE with interest as JP Morgan "upgraded the Singapore property sector from underweight to overweight largely because it believes the market is discounting physical market price declines of 12-40% which are too bearish." At the top of its buy list are Capitaland and CDL.

When I first commented on Capitaland on 10 Feb this year, I said that "A reader asked me if it was time for her to buy more Capitaland shares last evening. I told her I expect more downside today. In confirmation, the low of May 10 at $3.46 was taken out today without any hesitation by Mr. Market. The formation of three black crows now suggests that price could go lower. Some would say that it is more accurately described as two and a half black crows but I am sure the distinction is just academic.

"The next low to look at is $3.28 of July 09 and another reader today asked if it is time now to buy some especially if that low were tested. It would take someone very brave to buy in the current conditions, I feel. Could we see $3.28 taken out without hesitation by Mr. Market just like $3.46 was taken out today? Why not?" Read blog post here.

Price went on to touch a low of $3.08 on 17 March. However, anyone who bought some at the low of 17 March or thereabouts would be in the money now. The positive divergence on the MACD and share price is quite obvious: higher lows on the MACD and lower lows in share price. The ADX is also declining as the +DI crossed over the -DI on the upside: the downtrend is weakening.

For anyone still holding and for those who are thinking of entering, the question might be: "Would the price go higher?" I don't have the answer. I will say that the upward momentum seems to be weakening as long legged dojis were formed in the last two sessions. So, the downside risk is higher. The MACD, although rising, is still in negative territory and, so, we could just be seeing a rebound. Momentum is still negative.

If price should go higher, I see resistance at $3.40, a neckline. If that should break, I see a resistance band between $3.46 to $3.48. Beyond that? $3.56. If price should weaken? I see immediate support at $3.27, followed by $3.24.

I have only an academic interest in this counter (for now) but if I were to go long on this counter, I would do so on weakness as it retests supports. If I owned some shares bought at $3.08 thereabouts recently, I would sell some as it tests resistance at $3.40, if it should happen. If price goes higher, I would have more to sell. If price goes lower, I have the funds to buy more.

Cambridge Industrial Trust: Going for excess rights.

My entry into Cambridge Industrial Trust could not have been better timed. I became a unitholder again in the morning of 11 March at the price of 51c/unit. Of course, we know what happened in Japan on that day.

In my blog post that day, I said that "If the nil-paid rights should trade at 4c to 5c, it would be quite attractive ... Any price less than 4c would be a steal!" Well, the nil-paid rights are not trading below 4c and I didn't manage to "steal" any. Read blog post here.

I also missed the opportunity to accumulate at 47c/unit when the REIT was still trading CR. You might remember me saying this "What are my plans now? Buy more if its price weakens further? Looking at the daily chart, CIT is trading below the 200dMA. So, I look at the weekly chart for hints of the next support. The rising 100wMA is at 46.5c now and should provide relatively strong support. 46.5c? That is some way to fall from here! Yes, it is but remember that TA shows us where the supports are and not necessarily that they would be tested. If it should be tested while the counter is still CR, I would buy more.

"Buying 16 lots more at 46.5c would mean an average price of 46.11c... Of course, owning more units could possibly entitle me to more excess rights as well." Read blog post here. It never hit 46.5c where I was waiting and the lowest it went to was 47c. Tough luck.

So, since I got 17 lots at 51c, I would get 2,125 rights. I would, of course, round it up to 3,000 rights by applying for excess 875 rights. I will also apply for more excess rights in the hope of lowering my average price. With its unit price closing at 48.5c and hitting a high of 49c in the last session. This rights issue would be the first one I might not be making any money from in quite a while.

Would I stay invested? Well, the REIT's numbers have improved and should be a reliable passive income generator although I discovered something in small print and I replied to a reader on 19 March saying: "I looked at the announcement by CIT's manager again. We have to read the fine print. Tricky. 5.07c DPU would only kick in end of 2012 once the Extension Development Works are completed. Otherwise the DPU is 4.84c, post rights. So, to secure a 10% yield, buying at 48.5c per unit or lower would do it." See comments here. Yes, this was in fine print. Nothing wrong but it would have been better if the numbers were included in the table proper. I almost said something scathing when I read the announcement again.

So, although I am disappointed in more ways than one, I would probably stay vested unless I have a good reason to divest. Worst case scenario? A distribution yield of 9.7% for my investment.

First REIT: Accumulate on weakness.

On 21 March, I mentioned that "Technically, the REIT is still in a downtrend which started on 20 Jan 2011. The trend resistance is at 74c. If price is able to break 74c convincingly, by this I mean with higher volume, we could see old highs tested as the downtrend breaks." In the last session, the REIT touched 74c although it closed at 73.5c which is still within the downtrend. Volume was relatively thin.

Checking the ADX, we see the -DI declining while the +DI has turned up. In fact, the +DI is close to crossing the -DI on the upside. The ADX keeps declining which suggests that the downtrend, although intact, is weakening. So, waiting to accumulate at the 200dMA could be wishful thinking in the near future.

In a change of plan, I would increase exposure to this REIT on any weakness and this would be at 73c (100dMA), 72c (lower Bollinger) and 71.5c (the recent low of 17 Mar).

Related post:
First REIT: Rising on low volume.

CapitaMalls Asia: Moving higher.

CapitaMalls Asia's price action is most pleasing today. Momentum oscillators are all rising strongly, suggesting strong demand and accumulation. Volume has been rising for 3 days in a row as price moved higher.

I have said earlier that the former support at $1.83 would become the resistance to watch if price were to move higher. This is still valid. In fact, the declining 50dMA is approximating $1.83 as well. However, I decided to draw some Fibo retracement lines as well as to use Fibo fan lines to see if they agree on this. I hardly use fan lines although I had experimented with them many moons ago.

It is interesting that the Fibo fan lines suggest $1.80 (61.8%) as a strong resistance while the Fibo retracement lines suggest that $1.81 (50%) is a strong resistance. So, in the event of a continuation of upward movement in price, if these resistance levels are strong enough, we might not even see $1.83.

So, what would I do? I would queue to divest partially at $1.80 as a hedge. If $1.83 were to be tested, I would divest again. Good luck to fellow shareholders.

Related post:
CapitaMalls Asia: Downtrend broken.

Cache Logistics Trust: Downtrend intact.

After a brief two sessions of trading above the downtrend which started on 28 Jan, its unit price is once again within the downtrend. Fundamentally strong, this REIT's technicals are somewhat weak. The OBV suggests that distribution is ongoing.  

Could the divestment on 21 March by substantial shareholder, Morgan Stanley, have spooked investors? Morgan Stanley's stake in the REIT reduced from 7.1860 % to 6.9790 %.

With the chart spotting positive divergences and with the MFI suggesting some underlying demand, I expect the supports to hold up if retested. Unless distribution activities cease, it would be hard for price to move higher, however. So? This REIT could be bottoming too and, based on its strong fundamentals, I would accumulate on weakness, if any.


Related post:
Cache Logistics Trust: Mixed signals.

AIMS AMP Capital Industrial REIT: Still bottoming?

It is quite clear that this counter was in a downtrend until two sessions ago when price broke out of a steeper downtrend which started on 17 Feb 2011. Breaking out of the downtrend on very low volume could mean that the counter is starting a period of rangebound trading as it finds a bottom.  If this were true, we could see price trapped between 20c and 21c for a period of time.

Although the MACD histograms formed a higher low, the MACD itself did not although we could see it forming a higher high if the bouyant price action should continue. The higher lows on the MFI are quite obvious and the OBV has flattened in recent sessions. The mad selling down has ceased and the REIT has found support for now.

Fundamentally, it is a value proposition at 20c/unit as it would mean a distribution yield of 10%. With its loans not maturing until almost 3 years later and at a very low interest rate of 2.16%, there is very little risk in parking our funds here if we are looking for high yield investments. It is reasonable to assume, therefore, that its yield should lend support to its current unit price.

Related post:
AIMS AMP Capital Industrial REIT: Positive divergence.

CapitaMalls Asia: Downtrend broken.

Closing at $1.72 means that the short term downtrend is broken. Of course, if price were to go higher tomorrow, we would have confirmation. If price were to close below the trend resistance tomorrow, the break out would be a fake out.

With the -DI declining as the ADX falls, the downtrend is definitely weakening and the +DI is rising which is good news for people waiting for a possible trend reversal. The MACD has completed a bullish crossover with the signal line in negative territory and is pulling away. Momentum is encouraging. The MFI has formed a higher low suggesting that underlying demand is strong.

If price were to move higher, immediate resistance would be at $1.75. Eventually, if $1.75 were overcome, a test of resistance at $1.83 is probable in time.

Related post:
CapitaMalls Asia: Low volume retreat.

Saizen REIT: Update and sale of Johnan Building III.

We have more good news for Saizen REIT.  Firstly, Royal Hills Katagiri, which is located in Sendai, was viewed by the property manager today and was reported to be intact. This was the last of the 28 buildings which were reported as potentially affected by the earthquake and tsunami. "In the areas affected by the earthquake and tsunami, all 28 properties in Sendai, Morioka and Koriyama appear to have sustained only minor damage." Read announcement here.

Johnan Building III

Separately, the manager of the REIT reported the sale of another building today and this is really good news because it shows that investors' interest in Japanese residential properties is still very strong. This is especially remarkable given the recent disasters which shook the country.

The property divested is Johnan Building III. This is located in Fukuoka and is from the property portfolio of YK Shintoku. It was built in June 1983 and comprises 24 residential units, 6 commercial units and 21 car parking lots.

The property was sold to an independent private investor for a cash consideration of JPY 312,577,516 (S$4.9 million).  This was at a 0.5% discount to the property's valuation of JPY 314 million. Read announcement here.

Good news all round for Saizen REIT and we should see the REIT's unit price recovering gradually although to recover to the pre-crisis high of 18c could be difficult. Psychologically, there would be a shadow of doubt in the minds of investors. Although I have little doubt that gap close at 15c would happen, I believe that it might not be easy going beyond and that 15.5c and 16c would be formidable resistance levels.

Fundamentally, there would be some repair costs to contend with. It is also reasonable to assume that there could be some downward pressure when it comes to rental income for contracts which are up for renewal if the Japanese economy suffers a setback from the triple disaster. The Japanese Yen could stay strong in the short term but the longer term picture is clouded as the massive injection of liquidity by the Bank of Japan could weaken the Yen in time.

After taking into consideration the gloomier technical and fundamental pictures, it is still truly a relief that my worst case scenario of a total loss of the 28 buildings did not come to pass. Of course, the development at the Fukushima power plant needs monitoring as a meltdown which seems less likely with the passing of each day could impact the 3 buildings in Koriyama which are less than 60km away.

It could be too early to pop the champagne but the worst does seem to be over.

Cache Logistics Trust: Mixed signals.

Cache Logistics Trust's price action formed a hangman today, not a bullish signal, surely. However, closing at 94c is bullish since it is beyond the trend resistance. So, is the downtrend broken? It would seem so.

The momentum oscillators are encouraging and are still trending upwards with higher lows. A continuation of the upward movement would see immediate resistance at 96c which would be a good price to divest perhaps partially for a quick trade. Price could even touch 97c if sentiments are very bullish.

Related post:
Cache Logistics Trust and CapitaMalls Asia.

AIMS AMP Capital Industrial REIT: Positive divergence.

I am seeing positive divergence in the daily chart. Do you see it? Look at the higher low in the MFI which has just risen out of oversold territory. The upmove could see an immediate target of 21c and it could even test 21.5c before a pull back happens. Good for a trade, perhaps.

Related post:
AIMS AMP Capital Industrial REIT: More upside?

CapitaMalls Asia: Low volume retreat.

Although the stock touched a low of $1.57 in the recent sell down, the immediate support is still at $1.60. This is something I established sometime back using Fibo lines. If retested, $1.60 is likely to be a strong support as it has been tested twice since the low of $1.57 and held up successfully on both occasions.

Since the formation of a white spinning top three sessions ago, price has been retreating but on declining volume. The counter is not experiencing a massive sell down but a lack of buyers.

The MACD is rising again and we could be seeing a basing process for the stock. With the MACD still in negative territory, it is still too early to tell if the stock is going to emerge from its downtrend but the worst could be over. Buy more at $1.60 if support holds up? I just might do that.