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.

First REIT: Rising on low volume.

In my last blog post on the REIT, I suggested that the downside proposition looked more persuasive but I was also beginning to see positive divergences. Today, the MACD turned up and formed a higher low.

Price moved higher and closed at 73.5c. I think the positive divergence has been validated. However, rising on rather low volume is lacking in persuasive power.

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.

Unable to break the trend resistance at 74c could see the REIT trading lower and I would not be surprised then if the rising 200dMA should be tested for support. This is still at 70c.

Related post:
First REIT: Buying more?

Cache Logistics Trust and CapitaMalls Asia.

Cache Logistics Trust: On a day with lower volume, price could not break out of the downtrend. Instead, a doji, suggesting indecision, was formed.

Could we see price overcoming resistance and test the merged 50d and 100d MAs at 96c? Although the positive divergences are plain to see, we need volume to expand on any move upwards in order to overcome the trend resistance. Immediate support is at 92.5c in case of a pull back.

JP Morgan reduced its holdings on 15 March from 6.97 % To 5.83 % (44,210,000 units to 37,032,000 units).  That's a reduction of 7,178 lots. That was the day the trust touched 91c.

CapitaMalls Asia: No breakout today which obviously means that the downtrend is intact. Immediate support is at $1.66. If that were to break, keep an eye on $1.57. If it were to be retested intact on lower volume, it would be bullish.

A breakout would see immediate resistance at $1.75, $1.78 and, ultimately, $1.83.

Related posts:
Cache Logistics Trust: Positive divergences.
CapitaMalls Asia: At resistance.

Saizen REIT: Stabilising.

Congratulations to fellow unitholders who did not panic and sell at 13c. It does seem as if things are improving at the Fukushima plant and let us hope that things would continue to improve.

The management has yet to report on the final property in Sendai, Royal Hills Katagiri, which has not been visited. If the research by a reader, Data, which says that this property is located only 2km from the coast of Sendai is correct, it could cost a lot of money to repair the building, if at all possible. This property is 0.6% of the REIT's NAV and contributes to 0.4% of the REIT's annual income. So, the impact is not likely to be great even if it were to be written off.

Technically, there is still a chance that the counter could attempt a gap close at 15c and for people waiting to reduce exposure or to cut loss, 15c is still a preferred price compared to 13c or, indeed, 12.5c at the height of the panic selling last week.

Insider buying:
Beagle Capital Limited bought 20 lots of Saizen REIT warrants at 5c per warrant on 18 March.
Beagle Capital Limited bought 900 lots of Saizen REIT units at 13.72c per unit on 18 March.
Argyle Street Management Holdings Limited bought 150 lots of Saizen REIT units at 13.3c per unit on 18 March.

Related post:
Saizen REIT: Insider continues to buy as price recovers.

CapitaMalls Asia: At resistance.

Volume expanded visibly as price moved higher in the last session, touching a high of $1.75 before closing at $1.72, forming a white spinning top in the process. I don't like a spinning top in the current picture as it suggests indecision. Also, closing at $1.72 means that the downtrend is still intact.

If the 20dMA should be overcome in the next session, the downtrend would have been broken and we could see price rising to test $1.83, a previously strong support which should be a strong resistance now. In the event that $1.83 were breached, price could touch a high of $1.87. My refusal to sell in the recent price weakness would then be rewarded.

However, a continuation of the downtrend would find support at $1.60.

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