CapitaMalls Asia: Closed at $1.84.

The support identified at $1.85 was broken yesterday but recaptured. Today, price closed at $1.84. Do we hit the panic button, sell and run for the hills?

The black candlestick formed today was on the back of lower volume, less than half of yesterday's volume. Selling pressure is still around as suggested by the long upper wick of the candle. However, with price closing only 1c lower, it suggests that the bulls are putting up a fight here. The bears are not as strong as yesterday but still have the upper hand.

A short term positive divergence is what I see with higher lows on the MFI and the RSI as price declined. As price has been pushing the borders of the lower Bollinger and is some distance from the 20dMA, we could expect a brief respite from further downward pressure.

Connecting the highs of 10 Nov and 13 Dec gives us a steeper downtrend resistance line. This is where the declining 20dMA approximates. I expect some resistance at $1.95 in case of a rebound.

Related post:
CapitaMalls Asia: Bought some at $1.85.

Cache Logistics Trust: Still on my watchlist.

I hardly talk about Cache Logistics Trust but regular readers would know that this is on my watchlist. 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%.

Here are the numbers as at 30 Sep 10:
Gearing: 23.4%.
NAV/unit: 88c.
Interest cover: 9.2x.
Portfolio 100% leased.
WALE: 5.8 years.

Substantial institutional shareholders:
JPMorgan Chase   9%
Morgan Stanley     7%
The Capital Group 6%
Amundi                 7%

How likely is it for the Trust to retest 91.5c? Since 22 Sep, the OBV has been in decline, though bumpy. This suggests that there is gradual distribution going on. The MACD has also been on a decline. Volume is, however, very thin. Price could be quite volatile.

Anyway, if I get some units here, it is a move to diversify my portfolio but it is not absolutely necessary. If the price does not decline to the level I feel comfortable with, I would give it a miss.

See 3Q 2010 slides here.

Related post:
Cache Logistics Trust: Low gearing.