CapitaMalls Asia: A late reversal?

I spent a few hours in Ion Orchard today shopping with a friend who just moved into his new home.  Always nice to shop for things for a new home and watching someone else spend money.  It's a very therapeutic experience without any real damage to my own wallet.  What was an eye opener was the crowd at Ion Orchard.  The place was CROWDED!


I have a knack for catching bits of conversations of passers by and I must say I was amazed by how many foreigners there were.  There were Koreans, Chinese, Indonesians and Japanese.  Of course, there were Caucasians too.  These foreigners are now an important part of our domestic economy.  Their consumption contributes to a healthier GDP for Singapore, I have no doubt.  More importantly for me, CapitaMalls Asia owns 50% of Ion Orchard.  That makes me happy.

Fundamentally, CapitaMalls Asia is a company with solid numbers and technically, it seems as if it has started a reversal process having hit $2.26 two sessions ago.  The OBV shows that no distribution is taking place.  The Stochastics is now in oversold region.  The MFI still shows a slowing buying momentum.  The MACD has flattened while the signal line continues to fall, suggesting a possible bullish crossover in the making.

Price action formed a white candle in the previous session and actually broke resistance provided by the 20dMA at $2.31 at one stage, hitting a high of $2.33 before closing the session at $2.30.  All these after I suggested that the inverted black hammer in the preceding session was a possible reversal signal.  A reversal is confirmed... again.  Why again?  Well, you would remember an earlier reversal signal was confirmed but there was no follow through.  The problem? Anaemic volume.

It is quite obvious when we look at the Bollinger bands that CapitaMalls Asia has entered a consolidation phase.  There really isn't any trend per se.  So, I would like to draw your attention to the Stochastics.  In the reversal signal which did not follow through successfully, the Stochastics was not oversold but now, it is.  The chances of a successful reversal is now higher.

It is quite obvious to me that the top of this basing process is at $2.41.  However, getting there is going to take some time given the falling buying momentum as suggested by the declining MFI.  However, the lack of distribution as suggested by the OBV precludes any drastic downward movement in price.  Thus, the low of $2.19 is likely to be a strong support if any further downside presents itself.

My reading: Limited downside at $2.19.  Immediate resistance at $2.31 provided by the 20dMA and this is followed by $2.41, the top of the base formation.  Eventual target is at $2.55, a many times tested candlestick resistance.  If price continues basing with an upward bias as per my expectations, what we might see forming would be a double bottom formation.  Important: Volume has to expand with any move to the upside and this would see the MFI reversing its decline.  Vested.

Related posts:
Replies from AK71: CapitaMalls Asia.
CapitaMalls Asia: Reversal confirmed.

Golden Agriculture: Further divestment at 60c.

I hope Golden Agriculture made many happy today as the reversal signals seen a few days ago followed through nicely.  The price closed at 60c today, the previous high. My overnight sell queue at 60c was done towards the end of the day.

Looking at the chart, it is obvious that Golden Agriculture is firmly back in the uptrend channel.  Price action formed three wickless white candles in a row, reminiscent of a pattern which chart watchers call the Three White Soldiers and this pattern could signal more upside to come.

MFI rose above 50% convincingly, signalling positive buying momentum.  OBV continues to rise, signalling continuing accumulation.  The MACD has crossed the signal line in a bullish crossover.  All the momentum oscillators are bullish and also hint of more upside to come.

I have drawn some Fibo lines to determine the next resistance levels to watch in case of further upside.  I would like to draw your attention to 63.5c and 64.5c as these would be in closer proximity to the uptrend resistance in the course of the new week.  64.5c was also the closing and opening prices of the peak achieved in mid January on the 11th and 12th respectively.  This price would likely be fresh in the memories of market participants and would thus be a strong resistance.  I do not expect it to be taken out for now but I could be wrong.

Bugbear? Volume has not expanded in this latest move up in price and this suggests that we should not be too euphoric. I have put my remaining Golden Agriculture shares in the queue to sell in case its price hits the resistance levels I have identified in the preceding paragraph.

Certainly, from a fundamental perspective, the very strong showing by crude oil which is trading at almost US$85 a barrel as of now might have a spillover effect on crude palm oil and this would surely benefit Golden Agriculture.

Related posts:
Golden Agriculture: Reversal confirmed.
Golden Agriculture: Partial divestment at 57.5c.

Unique visitors: Crossing the 40,000 mark.

It might be a cliche but time really flies.  It has been slightly more than three months since I started this blog last Christmas Eve. Has it been so long? It feels like I just started blogging last week.  I guess we don't feel the passage of time when we are doing something we enjoy.

Blogging has introduced new groups of people in my life.  I used to simply share ideas with friends and family but I am now sharing ideas in cyberspace and reaching out to a wider audience.  I have made contact with fellow bloggers and I have many visitors to my blog, some of whom have left comments and exchanged ideas with me. My social life has become a tad fuller.

Today, the number of unique vistors to my blog crossed the 40,000 mark.  This is overwhelming and I am truly humbled by the support my blog has received so far.  I guess I must be doing something right here.  Although this is really a personal blog, your support and encouragement give me that little push to continue blogging and sharing my ideas.  Thank you very much and have a great long weekend. :)


Thank You Images

AusGroup: Update.

AusGroup seems to have some trouble breaking resistance at 61.5c. If we draw a trendline support from 9 Feb, we see the support at 59.5c today, it is quite clear that the uptrend is broken.

However, I would like to point out that volume was rather low and, in fact, it is true for other down days in the past few weeks. Volume has been generally lower on down days and higher on up days for AusGroup recently. This suggests that a longer term accumulation is underway and this is confirmed by the rising OBV in recent weeks. However, with the MFI turning down, I expect some weakness in the near term but I do not expect a crash in price.

If 58.5c gives way, the next supports are at 57.5c (50% Fibo) and 56.5c (38.2% Fibo).  If the price action moves above the trendline support once more, resistance remains at 61.5c.