Tea with AK71: 60c soya beancurd et al!

Tiong Bahru Market is a favourite eating place for me. Today, I had lunch there with my family.

The beancurd at Long Ji (Store No. 250) is the best and cheap too. I have brought friends and customers there before as well. Even the customers from Hong Kong are amazed at how good and inexpensive it is. 60c a bowl!

I always make it a point to bring some back to consume later in the day and night. A big container of yummy beancurd for only $1.10! I bought four containers' worth.

The dough fritters are only 70c each. I bought 3 for $2.00. I think the dough fritters at Food Republic are not as nice and they cost 90c each.

The Lor Mee is also famous.  There are two Lor Mee stores. This is the corner store next to a washing area. I cannot remember the store number. $2.50 a bowl and it includes fried fish and fried wanton.

Original Tiong Bahru chwee kway (steamed rice cakes?)! I prefer this to Jian Bo chwee kway. The secret of good chwee kway is really in the chye poh (pickled turnip?). Cannot be too oily and too mushed up. This is just nice. Price? A princely sum of $1.

Yummy. Burp.

CapitaMalls Asia: Up or down?

Someone asked me what is the probability of CapitaMalls Asia's share price going higher in the next two weeks? This is a fair question since TA is about probability. I am not saying whether it would go up or not but what is the likelihood of it going up or down. We are still trying to look into the future and it is never an easy task, if possible at all.

Looking at the daily chart from day 1, it is very obvious that CapitaMalls Asia's share price is in a long term downtrend. If we believe in trendlines, then, the very sharp downtrend which the counter is now consolidating within is likely to break. We could continue to see some upward movement towards trendline resistance, the nearest and steepest downtrend resistance line is approximating the declining 20dMA at $1.83 next week. Sounds familiar? Yes, $1.83 is a twice tested support turned resistance. Could be a tough nut to crack.

This is a very steep downtrend and, to be prudent, I might close a portion of my long position at $1.83, recognising the strength of the resistance, if tested. Remember, in a downtrend, selling at resistance is conventional wisdom. Keep the rest of my long position open to see if price could break resistance and head higher. In such a case, the next downtrend resistance approximates the declining 100dMA and that would approximate $1.96 next week.

Any signs from the momentum oscillators? Remember we said that the weekly chart is spotting a positive divergence? Remember how I am keeping an eye on the MACD in the daily chart to see if it could form a higher low? It seems that the MACD is forming a higher low. As price moved lower, seeing a higher low on the MACD is good news for bulls as it suggests a likelihood of a reversal in the downtrend.

What about the weekly chart? We still have a positive divergence between falling price and rising MFI and rising RSI. It is also quite obvious that the immediate resistance to watch is at $1.83. An encouraging sign is found in the formation of a white spinning top which is a probable reversal signal. This would need confirmation next week. All in all, things look pretty benign, technically.

Know where the resistance and supports are, know whether it is an uptrend or downtrend, check the momentum oscillators, act accordingly. It doesn't get any better than this, I suppose. Good luck.

Related post:
CapitaMalls Asia: Consolidating?

Daiwa ups CapitaMall Trust to outperform. Daiwa has raised its distribution per unit forecasts by 3.8% in 2012 and by 3.7% in 2013.
Friday, 04 March 2011

© 2011 - The Edge Singapore

STI +1.3%; valuations still attractive - SIAS.  It adds, “investors should start getting in on the market in small amounts as valuations are still attractive and the long-term uptrend remains intact.” 
Friday, 04 March 2011

© 2011 - The Edge Singapore

Golden Agriculture: 72c resistance.

Golden Agriculture hit resistance at 72c and closed lower at 70.5c, forming a black candle in the process.  In its attempt to move above 72c resistance, volume was relatively lower, suggesting a lack of buyers.

A dead cross between the 50dMA and the 100dMA is still on the cards and the market has turned cautious as evident in the declining volume as price tried moving higher in the last 4 sessions. A pull back would see initial support at 68c, followed by 64c, as provided by the rising 200dMA.

What if the counter were to move higher? Well, there is that probability since volume is healthy this week, forming a nice white candle in the process. In fact, it could be a 3 candle reversal pattern. Looking at the weekly chart, 72c is a longer term resistance as provided by the 20wMA. If this were to give way next week, we could see price go higher to 75c and, then, 80c.

On the other hand, things could get quite ominous if the downtrend which started in early January 2011 were to re-assert itself. The 50wMA is currently at 62.5c while the 100wMA is currently at 54c. Both these MAs are long term MAs, however, and should provide strong support if ever tested.

Related post:
Golden Agriculture: Signs of selling into strength.

Tea with AK71: iPad 2.

I have been sorely tempted by the iPad and I have been looking at the Samsung Galaxy Tablet.  I am so glad I did not buy either one because the iPad 2 is coming soon! Best of all, it would not cost more than the iPad. It would be at the same price! I can imagine many who are considering a tablet would now wait for the iPad 2. Bad news for shops selling the iPads... for now, anyway.

Jobs told those gathered for the unveiling the handheld computer is not only thinner than its predecessor, it is "dramatically faster."

"It has a new chip called A5," he said. "It's dual-core, so we get twice as fast performance on the CPU and nine times better graphic performance," the Times quoted Jobs as saying.

The new tablet is 33 percent thinner than the original iPad and weighs 1.3 pounds, down from 1.5 pounds, Jobs said.

Read more: http://www.upi.com/Business_News/2011/03/02/Apple-CEO-Steve-Jobs-gets-standing-ovation/UPI-12761299093214/#ixzz1FY1FAw3t

CapitaMalls Asia: Consolidating?

All we can really say is that the downtrend has come to a halt and that price is testing gap resistance at $1.75. In fact, today, price touched a high of $1.78 before closing lower at $1.74. Traders are selling into strength amid uncertainties in the world markets.

Although an inverted black hammer is not pretty, price still closed above the support line drawn with the low of 28 Feb as the source. This is encouraging. The declining volume as price tried to move higher is the major dampener for bulls here. If this continues, we could be seeing the early days of a longer consolidation process.

Immediate support is still at $1.69 and if this breaks, we could see price moving lower. The gap resistance at $1.75 which has cracked two sessions in a row remains the immediate resistance although weakened. A realistic target upon overcoming gap resistance is $1.83, a twice tested support that gave way on 23 Feb.

Related post:
CapitaMalls Asia: Steady in a sea of red.

Golden Agriculture: Signs of selling into strength.

Golden Agriculture's share price attempted to move higher today and touched a high of 71.5c. This is probably on news of higher CPO price which likely did better due to the strong price of crude oil. The counter's share price eventually retreated to close at 70c. There seems to be some strong selling pressure higher up.

However, closing above the downtrend resistance is good news for bulls since it confirms a nascent uptrend although it is a weak uptrend as suggested by a declining ADX. Unless volume expands significantly on the next upmove, expect continuing resistance as price tries to move higher. The declining 50dMA seems on track to forming a dead cross with the rising 100dMA which is currently at 72.5c. This could cap any upside from here.

Related post:
Golden Agriculture: Downtrend once more.

CapitaMalls Asia: Steady in a sea of red.

For a brief few minutes, its share price overcame gap resistance at $1.75, touching a high of $1.76. Ultimately, gap resistance proved too strong as price closed the session at $1.75. Volume was lower than the preceding session which is probably why price action lacked the impetus to close above gap resistance.

Nonetheless, in a sea of red, closing unchanged is a sign of strength. Both MFI and RSI have turned up. While it is still too early to say, we could be seeing the formation of a higher low on the MACD. It would be clearer by end of the week. This could reinforce the positive divergence we are witnessing in the weekly chart.

Overcoming the gap resistance convincingly could see the share price testing resistance at $1.83 and perhaps even $1.88. A more bullish scenario could even see the longer term downtrend resistance approximating the declining 100dMA tested.

Related post:
CapitaMalls Asia: More upside after gap cover?

Citi upgrades CapitaMall Trust to Buy from Hold. It estimates the Illuma acquisition would increase DPU by approximately 1%, given its low financing cost of 2%. 
Wednesday, 02 March 2011

© 2011 - The Edge Singapore

Golden Agriculture: Downtrend once more.

Golden Agriculture started the day at 69c, touched a low of 67.5c before closing at 68.5c, forming a black candle with a long lower wick. That this formed within a preceding white candle has a semblance of a bearish harami. The bearish tone is reinforced by the fact that the downtrend resistance is at 69c which means that the counter's share price is once again in the embrace of the downtrend which started on 4 Jan.

Although price might go higher to retest previous session's high of 71c, the probability of further weakening is rather high. Why a retest of previous high at 71c and not 72c as provided by the 100dMA mentioned in earlier blog posts? Well, traders are going to remember 71c as the price they could have sold at but didn't. So, 71c is now a psychologically important resistance level.

A weakening in price could see the 200dMA, now at 64c, tested once more as support. If it holds up, I could possibly go long on the counter once more. Otherwise, the next support is the low of 23 Feb at 61c. Making sure that support holds up before going long is the way to go.

Related post:
Golden Agriculture: A one day gain of 7 to 9.4%.

Cache Logistics Trust: A retest of 91.5c low?

This is one counter I have been patiently waiting for price to reach a level I consider relatively attractive. Technically, it is looking quite possible that my wish could come true.

Today's trading volume is the highest since 1 Nov 2010. A long black candle was formed. Coupled with increased volume, this is very bearish. We could see the recent low of 92.5c tested next. Could we even see the low of 26 May 2010 at 91.5c tested? There is a chance.

I have put in my buy queue at 91.5c. With an annualised DPU of 7.76c, it would mean a distribution yield of 8.48%. This is lower than AIMS AMP Capital Industrial REIT's 9.76% (with a DPU of 2c at the current price of 20.5c).

A lower distribution yield is acceptable to me due to the REIT's much lower gearing of 23.7% and much higher interest cover ratio of 9.3x. Cache Logistics Trust's numbers look stronger than AIMS AMP Capital Industrial REIT's (gearing of 33.6% and interest cover ratio of 5x). Buying at 91.5c is still a premium of 2.8% over its NAV/share of 89c but this is marginal and acceptable for a lower risk investment.

Related post:
Cache Logistics Trust: Weakness after XD.

Healthway Medical: 4Q 2010 results.

Not expecting any spectacular improvement in numbers from Healthway Medical. Let's take a look:

1.  Revenue declined 23.8% in Q4 compared to the same period last year.  For the full year, revenue declined 12.2% compared to the previous year.

2. Staff cost increased 11% in Q4 compared to the same period last year.

3. Profit before income tax decreased 68.2% to $1.133m in Q4 compared to the same period last year.

4. Cash flow from operations is positive for the quarter at $6,289m. This may seem like a good thing but scrutinise the numbers and we realise that most of this is because of trade and other receivables which came up to $6,927m. If we take these away, cash flow from operations would be negative.

 

5. EPS for the quarter is 0.04c which is an improvement over the 0.01c in Q3 but down from 0.23c in the same quarter last year. Full year EPS 0.14c.

See results here.


Although the numbers are still bad, generally, the numbers are getting less bad. The increase in staff cost seems to be slowing down while the reduction in profit is not as severe as before. Even the negative cash flow from operation situation is less serious now as compared to negative $2.3m in Q2 and negative $1.278m in Q3.

With an EPS of 0.14c, Healthway Medical is trading at a PE of 100x. No investor worth his salt would touch this. However, there could be opportunities to trade this counter and I would view any rebound as a chance for stale bulls to reduce exposure.

Immediate support is at 13.5c but if this were to break, we could see 12.5c next. Strong support is to be found at 11c. Technically, the only encouraging sign is the MFI which shows some underlying support with higher lows.

So, if we do not see a sell down tomorrow, it would suggest that only stoic long holders are left. In fact, from the peak achieved on 16 June 2010, volume has been declining as share price retreated. No matter how dismal the fundamentals are, if all the sellers have sold, share price could begin to bottom in earnest. Wait and see.

Related post:
Healthway Medical: 3Q 2010 results.

CapitaMalls Asia: More upside after gap cover?

Some may wonder why CapitaMalls Asia seems to be suffering from malaise even as Capitaland's share price recovered almost 3% today. A quick look at the chart and the answer is obvious. Gap resistance is found at $1.75 and the counter closed the gap today. What now?

The MACD histogram has turned green. With the MACD still in negative territory, a green histogram probably indicates a short term bullish bias. The MFI has dipped into oversold territory while the RSI is upturning in oversold territory. Even if the price does not recover in a hurry, the technicals hint that any downside could be limited for now.

Immediate support has been established at $1.69, the low of 28 Feb while immediate resistance remains at $1.75, beyond which, resistance could be found at $1.83 (a twice tested support turned resistance) and $1.88 (downtrend resistance and declining 20dMA).

Related post:
CapitaMalls Asia: Another failed reversal signal.

Golden Agriculture: A one day gain of 7 to 9.4%.

The STI experienced a nice up day as it closed 1.9% higher at 3,067.60. Golden Agriculture closed higher as well, breaking the immediate resistance of 68.5c, touching a high of 71c before closing at 70.5c.

I have closed my long position bought at 64c yesterday at 68.5c and 70c today, locking in a one day gain of 7% and 9.4% respectively. For those who have yet to close their positions, the next resistance levels are at 72c (100dMA) and 73.5c (50dMA). Having broken out of the downtrend which started on 4 Jan on the back of a high volume white candle day, there is a chance that price could go higher. Then, why did I choose to close my position?

A one day gain of 7% to 9.4%, risk free, is good enough for me. There could be another 2 or 3c gain from here but the risk is definitely higher now. 68.5c is also a natural price level for partial divestment as it approximates the position of the downtrend resistance, on top of being the price where we find the 20dMA.

A look at the weekly chart shows that 72c is likely to be a strong resistance. Notice also how the MFI and RSI are forming lower highs and lower lows. We could be experiencing a very strong rebound and when the energy is spent, price is probably heading lower.

STI increases 1.9% to 3,067.60 at closing. Golden Agri Resources surged 8.5% to 70.5 cents. UOB-Kay Hian Holdings raised its rating to “hold” from “sell,” while HSBC maintained its “overweight” recommendation and cut its share-price forecast to 81 cents from 90 cents.
Tuesday, 01 March 2011

© 2011 - The Edge Singapore

Related post:

Golden Agriculture: Stellar FY2010 results.

SoundGlobal: Sound the alarm?

On 27 Jan, I blogged about SoundGlobal and how I was, once upon a time, an investor in the company, when it was known as E-pure. I concluded that blog post by saying "I like to use Fibo lines in such an instance to see how low price could go in case support breaks. Support is, of course, at 70c. Looking at the chart, the three golden ratios are at 62c, 59.5c and 57c. Buy some at those levels? I might if the other signs are encouraging."

The counter closed at 61c today as price hugged the lower Bollinger. ADX has been rising sharply as the negative DI continues higher. More weakness is probable.

However, in case of a rebound, expect gap resistance at 67.5c and support turned resistance at 71c.

Fundamentally, the company's full year results announced today might have disappointed although a 1c dividend was declared.

Year on year, profit increased a mere 2.3% although revenue increased 36.5% and gross profit increased 42.8%. Expenses and income tax shot through the roof.

EPS: RMB 8.4c (Errata: RMB 22.4c)
NAV/share: RMB 149.5c

See announcement here.

So, will I buy at 61c? I think it is still pretty pricey with a PE of about 36x (Errata: 14.5x). I might still be suffering from the memory effect and 61c is just not an attractive price for me to go long on this counter again.

Errata: Made a mistake as I took in only Q4's EPS. At 14.5x, it doesn't look so pricey anymore.

Related post:
SoundGlobal: The former E-pure.

CapitaMalls Asia: Another failed reversal signal.

The Bullish Harami Cross failed as a reversal signal. Today, price gapped down at $1.73 and went on to touch an intra-day low of $1.69 before closing at $1.72. Very high volume accompanied this black candle day.

On the face of it, the entire picture looks very bearish but the formation of a black hammer suggests that the bulls are fighting back. In fact, the trade summary shows that sell downs and buy ups are almost evenly matched.

In an earlier blog post, I suggested that $1.70 is a strong support and that I would wait to see if this support level holds up before deciding whether to add to my long position. I have added to my long position at $1.71 today as the $1.70 level was tested and held up.

CapitaMall Trust flat; Iluma buy a long term story - UOB KayHian. At an NPI yield of 3.8%, does not look yield accretive to the portfolio NPI yield of 5.6% or the trading yield of 5.3%.
Monday, 28 February 2011

© 2011 - The Edge Singapore

Related post:
CapitaMalls Asia: Another reversal signal.

Golden Agriculture: Stellar FY2010 results.

In my past blog posts on Golden Agriculture, I said that this company is the most leveraged to CPO price and the very strong CPO price in recent months naturally means higher profits for the company. Golden Agriculture reported stellar results for FY2010 today:

Year on year:

1. Revenue increased 53%.

2. Core net profit increased 91% (excluding gain from changes in fair value of biological assets, foreign exchange loss and exceptional items).

3. Net debt/equity ratio at 0.1x.

4. Dividend of 0.77c per share proposed.

5. NAV per share is US56c.

6. EPS is US12c.


See full presentation here.

The after market sell down of almost 10m shares at 65c is somewhat disconcerting. This notwithstanding, the immediate resistance to any continuing upward movement in price is provided by the descending 20dMA which would approximate 68.5c tomorrow. I went in this morning with a small long position at 64c. Let us see how things turn out tomorrow.

Golden Agri Q4 net more than doubles to $1.49b. Its revenue surged 85% to US$1.19 billion from US$643 million in the year-ago period and core profit more than doubled to US$146 million.
Monday, 28 February 2011

© 2011 - The Edge Singapore

Saizen REIT: Insider moves and divestment of Aistage Ushita Minami.

Catching up on my reading:

1. 21 Feb: Somerset Holdings Limited (SHL) converted 206,800 warrants into new units. 601,600 units held after the change. Mr. Dennis Lam Siu Sun, a director of the REIT, is the beneficial holder of more than 20% of the issued share capital of SHL.

2. 25 Feb: Divestment of Aistage Ushita Minami for a cash consideration of JPY 270,000,000 (S$4.2 million). Location: Hiroshima.  Built in August 2006, comprises 32 residential units and 7 parking lots. Sale price is a premium of approximately 0.7% to valuation.

Golden Agriculture: Immediate price target in a rebound.

On Friday, I mentioned that it is encouraging to see Golden Agriculture going above the 200dMA (currently at 63.5c) and wondered if breaking support earlier was just a whipsaw. So, is it time to go long here?

Well, the downtrend that started on 4 January is still intact. The MACD histogram shows a short term bullish bias. MFI and RSI are both turning up in oversold territories. The ADX is flattening which suggests that the downtrend has weakened although still in force.

If I were to enter for a quick trade, I would buy as close to the 200dMA (63.5c) as possible. In a downtrend, sell at resistance and the immediate resistance would be provided by the 20dMA which approximates the downtrend resistance at 69c. So, there could be a 10% or so upside.

The MACD is still declining in negative territory which suggests that any upward movement in price could just be a rebound. To err on the side of caution is probably prudent.

Related post:
STI up 1.8%: Out of the woods?