Charts in brief: 5 May 10.

STI drops 1.4% to 2,860.31 at closing
Wednesday, 05 May 2010

© 2010 - The Edge Singapore

Saizen REIT: FA is about value. TA is about price. Although this REIT is still severely undervalued, when negative sentiments rule, its price could get pushed down lower. My overnight buy queue at 16c was not done.  I am back in the queue.

For people who are hoping to make a quick buck, this might not be a good time to buy in. MFI has formed a lower low and OBV is down. MACD is under zero. All technicals are bearish except for a consistent picture of low volume pullback. If this counter tests the rising 200dMA at 15.5c, I would buy more.

AIMS AMP Capital Industrial REIT: Technically, this REIT is stronger than Saizen REIT.  MFI has formed higher lows and OBV has hardly declined.  The MACD is poised for a bearish crossover with the signal line though. The merged 50d and 100d MAs provide an important support at 21.5c and 23c remains the resistance.

CapitaMalls Asia:  Could this be a morning star setup? If the price opens above today's closing price of $2.08 and trades to close at or above $2.12 tomorrow, there is hope. The MFI is still in oversold territory but the decline has halted.  OBV is still declining and amidst the distribution activity, price managed form a white candle today.  This, I view as positive. In the event of a successful morning star setup, I expect initial resistance at $2.19.

SPH: Fourth consecutive black candle day. Black spinning top today. Looking at the MFI, we see that this counter was overbought for quite a while.  The index is now moving towards 50%.  50% on the MFI sometimes function as a support or resistance.  Together with the black spinning top today, which suggests indecision in a downtrend, we might see a rebound.  This is especially the case when price is now trading at the lower end of the Bollinger bands.

In the event of a rebound, the downturning 20dMA should provide a strong resistance.  This is at $4.04 now. The set up now might give rise to a morning star pattern just like for CapitaMalls Asia.  We will have to wait and see.  100dMA provides support at $3.79 and 200dMA provides support at $3.67 in the event of a further decline in price.

Golden Agriculture: MFI declines. OBV declines.  MACD has gone under zero. Overall, a bearish picture. The price managed to close at 55.5c, the support identified in previous TAs.  However, that this support was punctured today is a negative. If the 200dMA at 50.5c is tested, it has to hold.  If it does not, the uptrend is compromised. No prize for guessing where I am putting my buy queues.

Healthway Medical: Nothing much has changed apart from the fact that price touched a low of 14.5c today. 14c next? Possibly but the picture of low volume pullback is intact. We do not want to see the rising 200dMA breached.  This is currently just below 14c.  I might join the buy queue at 14c as a hedge.

FSL Trust: Heavy reduction in volume as price moved lower today to close at 52c. MFI has moved deeper into oversold territory.  OBV declined further. Another probable morning star setup. In the event of a reversal, strong resistance could be found at 60c.

I still see support at 51c in the event of a continuing decline. I bought some units today at 52c with a view that most of the heavy selling is done and over with.  Of course, I cannot say that the selling is over but any selling would probably be less vigorous from now on. The panic we see here approximate that of what was seen during the onset of the financial crisis in late 2008 and such panic, I believe, has to be overdone.

Courage Marine: Got my shares today at 20.5c and 20c.  MFI declining towards 50%. OBV declining. MACD moving towards zero and would probably go under. The best case scenario, technically, for this counter now is some sideway movement for some time to come, it would seem. What is left for me to do now is the easy part: hold.  Of course, I might buy more on any further weakness.

Related posts:
Charts in brief: 4 May 10.

Charts in brief: 4 May 10.

STI drops 1.5% to 2,901.18 at closing
Tuesday, 04 May 2010

© 2010 - The Edge Singapore

Courage Marine: Closed at 20.5c and I managed to get part of my overnight buy queue filled. In the buy queue again tomorrow. I am also in the queue to buy at 20c. Uptrend is still intact although weakened. The MACD is pulling away downwards from the signal line.  The weakness would probably continue.  I would draw attention to the volume.  It is shrinking with the weakening price.  A low volume pullback. Fundamentally, this is still one of the stronger shipping companies listed in Singapore.

Courage Marine acquires Capesize vessel as replacement
Tuesday, 04 May 2010

© 2010 - The Edge Singapore

CapitaMalls Asia: Sell signal on the MACD. Reversal hopes dashed. Reaching a low of $2.09 before closing at the round number of $2.10 suggests more weakness to come on an ugly black candle day. $2.07 is the next support.  I am not buying more for now.  I will wait and see if the subsequent support levels hold.  Buying at supports in an uptrend is the way to go but the downtrend here is clear.

Golden Agriculture: Went XD. Price closed at the 58c support.  Next support is at 55.5c. The MACD continues to move down and is approaching zero.  The MFI continues to decline below 50%, suggesting a lack of buying momentum. There is no heavy selling going on but continuing weakness seems likely.  This would likely put more stress on the current support level.

Healthway Medical: A picture of low volume pullback continues as price closed at 15c today. 138.2% Fibo is at 15c and the 150% Fibo approximates 15c.  This is a stronger support than 15.5c, surely.

MFI is creeping up in the oversold region which suggests that buying momentum is slowly improving.  OBV is slowly drifting down which suggests that there are people giving up and selling down the counter.  No big movement either way which suggests that slowly buying in as a hedge is quite safe.  The rising 200dMA is at 13.5c and this limits the downside risk.

Saizen REIT: MFI dipped further into oversold territory. OBV is flat. MACD has dipped under zero.  The weakness is obvious.  It is during times of pessimism when people are giving up that bargains are to be found.  The reasons for me to buy into Saizen REIT remain valid and I am still in the buy queue at 16c.

FSL Trust: This counter stood out like a sore thumb in my watchlist.  It was so red and sore that I had to do a midday analysis of it. Well, technically, the picture is so obviously negative that it is not necessary to say much. The merged 100d and 200d MAs provided a very important support at 60.5c.  Breaching that was a bad sign. The gapping down today and the subsequent huge ugly black candle suggests further weakness.

The question on people's minds is probably how low might it go? I don't know but I can tell that the next important support is at 51c or so.  This is derived from drawing two sets of Fibo lines.  I would wait and see if that holds, if it goes that low.

Fundamentally, FSL Trust's business is a simple one.  It has to ensure that its ships are leased out and it gets charter income.  After deducting all the expenses, it could distribute what is left to unitholders.  These days, it does not give out 100% as it keeps some to pay down its debts.  It is still paying out of its cash flow and not earnings.

The premature end to the two leases would cost the trust US$20,700 x 2 per day in charter income. This represents 15% of FSL's charter income. This might affect future DPU if the management does not have any contingency plans to reduce the negative impact of this development.

Related posts:
FSL Trust: A sinking ship?
Charts in brief: 3 May 10.


Posted May 04, 2010 10:07am EDT by Henry Blodget

FSL Trust: A sinking ship?

The sell down today is very severe and it is due to revelation that two ships are being returned prematurely.  Their leases were supposed to end in 2014. This would mean the removal of two significant income streams for the trust to the tune of US$20,700 per day per vessel, to be exact.  See announcement here.

At midday, FSL Trust was down almost 10% at 54.5c on extremely high volume. Two groups of people are probably wondering how low it could go.  The first group would be unitholders (if they have not sold by now).  The second group would be people who still want to buy into the trust for some reason.

Looking at the chart at midday, all MAs, short and long term, have turned down.  The MACD is plunging into negative territory and pulling away from the signal line. MFI re-enters the oversold region. Look at the OBV, it has jumped off a cliff!  People are discarding FSL Trust! Unless some re-assurance is received from the management that the trust has some contingency plans, this panic selling is likely to continue for a bit more. 

How low could it go? In such a panic situation, it is hard to say but it could go much lower. However, to be fair, in situations of extreme selling, there is always a chance of a rebound. I will do some charting again this evening and perhaps look at the numbers too.

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High yields: Successes, failures and the in betweens.
Charts in brief: 19 Mar 10.

Charts in brief: 3 May 10.

A brand new trading day in a brand new month.  It's May! Are you going to sell in May and go away?

STI drops 1% to 2,944.22 at closing
Monday, 03 May 2010

© 2010 - The Edge Singapore

CapitaMalls Asia: Black candle day on reduced volume. Price closed at gap support: $2.16. MFI is still in the oversold region. MACD is still below zero.  Momentum is negative but the distance between the MACD and signal line has narrowed. Reversal is looking dicey, again. See what happens tomorrow.  As usual, I would sell on the way up.  If price continues to decline, look to the next supports and see if they hold.  Would buy on weakness if supports hold as I still like the fundamentals of this counter.

Golden Agriculture: MFI and OBV flattened.  This counter is looking directionless. Having been trading beneath the 20dMA ,which has turned downwards, for four sessions in a row does suggest that a slow drift downwards is probable. 60c is the immediate resistance now.  If the support at 58c is taken out, the next support could be found at 55.5c as provided by the rising 100dMA.

Healthway Medical: Traded the whole day at one price only, 15.5c. The trading volume has been in decline as the price drifted lower.  This is a positive. The rising 100dMA should provide a relatively strong support at 15.5c.  The MFI is in oversold territory and I do not expect the price to crash.

The current price level is good to enter as a hedge for anyone who has been waiting to get in.  However, looking the MACD's behaviour of staying closely to the signal line in a parallel fashion as it goes deeper into negative territory suggests that this malaise might continue for some time. In case of further weakness, support would strengthen with every 0.5c decline in price.

Courage Marine: Price plunged after XD today. I like the fundamentals of the company and I see 20.5c as a strong support provided by the rising 50dMA and I would buy more at that level.  Price might continue to weaken to 20c and I would accumulate if it happens.  If price continues to lower towards 18c which is the price where the counter made a double bottom, I would load up more.  A triple bottom?  Maybe.  So, buy on weakness but I would not break the piggy bank.

Especially, I would like to draw attention to the declining volume as price weakens.  It is a low volume pullback.  This gives me greater confidence in my decision to accumulate on weakness.  The FA is good.  The TA lets us know entry prices which are considered fair.  It doesn't get any better than this for me.

Saizen REIT: Ongoing weakness seen here. 16c might be called upon as the support next and this, in my opinion, would be a strong support as we see three Fibo lines approximate 16c. They are the 138.2%, 150% and 161.8% Fibos. I am in the buy queue at 16c.

MFI is in the oversold region but the down trending OBV suggests some distribution activity.  So, it might be oversold but there are unitholders who are still willing to sell down.  Looking at the numbers, the suggestion is that smaller unitholders are the ones selling.  I do not see any high volume sell downs. For a REIT with almost a billion units currently in the market, a daily trading volume of 1m to 2m units is almost nothing.  If people are willing to sell cheaper, I am willing to buy cheaper.  At 16c, this would be almost a steal at a 60% discount to the last reported NAV!

Related post:
Charts in brief: 30 April 10.