London Metal Exchange: Nickel

Inverted head and shoulder pattern: 28500 (done - 28700)
Bullish flag/pennant: 31700 (rough estimate - $14.37/lb)

Possible upside at current price: 13.90%
Short to medium crazy nickel forecast: $16/lb

Nickel chart is filed under Nickel Asia(NIKL) chart.

CASH BUYER 28,670.00
CASH SELLER & SETTLEMENT 28,680.00

Looking way back into the bigger picture:



Just broke out of the bigger inverted head and shoulder. Judge it for yourself.
It seems to me that the demand for the metal is growing though.

Holding up?

The market closed slightly lower today by 5.95 points on a relatively average turnover that we have without the huge cross sales daily. And it would pretty much safer to assume that the current downtrend is going to last until the actual reversal. Falling method candlestick pattern has also formed on the daily charts suggesting the continuation of further downtrend.

The rally on Hang Seng Index barely had any effect on Asian markets.

The decline today is led by TEL -2.20% breaking heavily from its support, PNB -3.26%, AC -1.12%, ALI -0.68%, and MER -0.45%.

Cushioning the fall are PCOR +7.16%, ICT +3.70%, MEG +2.49%, MBT +2.32%, SM +1.55%, and AGI +1.23%. Without the gains from these issues, the index would have fallen hard today.

Other losing issues with significant turnover value includes LND -4.46%, CYBR - which I thought had a valid breakout buy signal yesterday, fell 3.48%, JAP stocks ORE and SLI, losing 3.10% and 3.08% respectively.

Trades are pretty much scattered everywhere. Macquarie have been buying PCOR by mid session. Looking at the charts, it seems to be poised to move sideways with support at 13.50 and resistance at 16.

I think it was UBS who was trying to push AEV up(barely) with 0.80% gain today. Chart-wise, one more "up day" but will not exceed 38.50 before heading back and fill the gap at 33.65.

There seems to be a bullish pattern forming on the daily chart of NIKL but I could be biased as I have a position in the stock. All positions are now up though. One thing I can say though, spot price for nickel is up by 3%.
*Price of nickel in LME lags by a day.
Will post my "technical analysis" on nickel.

How can I be hungry and sleepy at the same time?

Philippine Stock Exchange Index (PCOMP)

Accelerated downtrend.

Signs of reversal:

1. Formation of higher peak and trough.
2. Steep decline on heavy volume.

The steep decline on heavy volume would be the "blast to put the fire out". A parabolic drop so to speak - the sign of capitulation.

Aboitiz Equity Ventures (AEV)

Waiting and watching it test the strength of the possible reversal. Reversal in the works.

Alliance Global Corporation (AGI)

It would be much safer to assume that it will simply range trade til kingdom come, unless it does a convincing breakout - strong candlestick pattern and heavy volume.

Breakdown to the downside - support at 10.90 - will prompt a sell signal.
Breakup to the upside - resistance at 13 - will prompt a buy signal.

To lessen the risk of the trade, take profits/take cover after the breakout and buy back at the breakout point to test the strength of the trend.

Meralco Electric Company (MER)

Hypothetical short position at 219 is down by 0.91%.

London Metal Exchange: Nickel

CASH BUYER 27,830.00
CASH SELLER & SETTLEMENT 27,835.00

Down by 1.5% from last Thursday.

From the beginning of the year(01/01/11 - $12.62/lb), Nickel prices has risen by 10.50% up to date(02/14/11 - $12.62/lb) with a high of $13/lb last February 8.

Sell on rally?

The market rebounded in today's session with 47.58 points, 1.27% higher from Friday's session along with other Asian markets, with Hang Seng leading the rally with +1.30%.
However, value turnover is relatively light in today's rally.

Leading the rally for today are ALI +4.29%, MBT +2.38% and DMC +1.53% while the selling of TEL continued further today, losing another 0.34% and now resting at its support at 2360.

Other gainers with significant turnover are CYBR +11.65% and LIHC +4.71%.

I closed my position in AGI for a total of -1% of equity. The weak opening prompted me to sell it, plus the distribution of several foreign brokers specially Deutsche and Macquarie for over a week now felt more obvious than before, with COL only supporting the stock, I felt I was on the wrong side of the trade, thus the closing of the position.

From the proceeds of the position in AGI, I decided to complete the position in NIKL today. I put a bid of 21.65 after the opening. My bid didn't get hit disappointingly so around 11:15, I decided to cancel by bid and buy at the market. It closed lower at 21.70. How frustrating. 25% of the position I got at around 22-ish are suffering from a small paper loss while the majority of the position I got lower at 19-20 range are still holding up the gains so I am still net positive in the issue.

Just following its trend to minimize the stress in trading. Need to endure the drawdown though. Anyway, 5-minute chart looks pretty good as it seems to be sold down at the closing. Let's see how this one goes this week.

If only I had more patience to wait for a couple of days.

Still watching AEV, AP, JGS, and URC for possible reversal plays. I lowered the priority for FLI and MEG for the meantime until they fully recover from their downtrend. For the meantime both are still falling knives and dead cat bounces.

I don't know what to say with SCC today, but I got buy signal today. It looks pretty ugly with a small white candle today but I don't know. I think I'm going to range trade this one in the meantime. Weekly and daily trend is up.

Still a very selective market, I guess the best stocks to range trade or cat plays are the ones with relative volatility.

CYBR looks pretty interesting issue for this kind of play. Weekly trend is up, daily trend is up but intraday chart looks pretty manipulated as was only bought up at the closing.

Asian markets are opened higher by around 0.71%. Let's see if the PSEi will "outperform" today.

Bear Scans: Jolibee Food Corp (JFC)

In a "long only" market, avoid.

Bear Scans: Atlast Mining Corporation (AT)

In a "long only" market, avoid.

Culling the weak.

Jesus Christ, wave after wave came the selling as the market opened, sending the index to a low of negative 60 points. From that point, I know that the market has entered a short term parabolic drop. Margin calls have been very evident during the opening as most of the selling was coming from COL. Value turnover for today has dropped significantly (but almost the same levels from the past 2 days if you discount the huge cross sales in AEV) which is fairly acceptable for first green day after a huge decline.

The margin calls seemed to be abused by brokerage houses as they only need to push the prices just a little more after the huge drop from yesterday. I think the right term for it is "squeezing out of the trade". Like when somebody pushes up the price just a little higher than usual when there is alot of short bears. Bears take cover, pushing the prices higher. Then the one who pushed the price unloads his shares to the covering bears.

This is just a fruit of my wild imagination though. :P

This is what happened in AGI during the first 30 minutes of trading:



I knew it was bound for a bounce so I wrote the text on the chart. I was deciding to close my entire position in AGI that time. I did not close it but sold the shares I got at 12.18 the day before at 11.28, right at the last doji after the steep decline. I needed the cash to increase position in NIKL. Right after I sold the shares, bam, somebody bought it up to 11.40. I was like, what the f? Anyway, I still have my original shares at 11.74 so the closing today is not bad.

Closig bid/ask looks pretty good to so I expect it to resume heading up by next week. Hopefully it breaks out of its pattern successfully next week.

I closed my position in SMC today despite of the bullish pattern that I was seeing in the 5-minute chart - ascending triangle. However, the target was only pointing at 185 - my original entry. So I closed the position.

With the cash I was able to generate from AGI and SMC, I increased my position in NIKL. I have increased my position in NIKL by 240% so I am pretty heavy in NIKL now.

INTRA INVEST has only sold 380k shares today. A little more than 4M shares to go.

Hopefully, everything recovers by next week so there would be a chance for us to unload/limit the losses. A dead cat bounce so to speak.

Foreign Activity

Net Foreign Selling has already amounted to 7.3B YTD.

How much more do you guys still have to sell?

Philippine Stock Exchange Index (PCOMP)

RSI just went into oversold territory. The only problem now is how long will it stay oversold and how deep do we go before we have that dead cat bounce.

Nickel Asia Corporation (NIKL)

Following the trend.

London Metal Exchange: Nickel



CASH BUYER 28,255.00
CASH SELLER & SETTLEMENT 28,260.00

Semirara Mining Corporation (SCC)

Following the trend.

Manila Electric Company (MER)

Trending down in an accelerated manner. Bearish flag breakdown at 224.
Hypothetically short at 119. Looking to cover(initial) at 200.
If it breaks below 200, best level to cover is at 156.

Alliance Global Corp (AGI)

Fake out at the breakout?

Ohh shhi- - -

Yes, I was like that during the entire session today. Wave after wave of selling didn't falter even until the closing. Only selected issues were able to recover by the closing.

The market broke the "support" at 3800 today on heavy volume, shedding 105 points today or 2.73%, closing at 3738. Even without the huge cross in AEV worth 1.7B, the total turnover for today still falls around 4.6B which is pretty bad specially on down days. Jesus Christ, 100 points in a day. Looking from here, filling the gap at 3600 looks pretty plausible in short/medium term.

The low value turnover earlier this week meant the lack of buyers. So there, we got the confirmation today.

I believe that with the sharp drop of the market today, we are probably bound for a quick dead cat before heading down further. Worst case thing that could happen would be another wave of panic selling without the dead cat.

The only issue that have a significant gain and volume is MRC but one can only look at it with skepticism as it is pretty much a controlled issue. Looking at its intraday trades, it only moved at the closing. It feels like it was manipulated today so it would have some "momentum" for tomorrow, hopefully enough to disposed whatever was bought today.

My positions in AGI and SMC went underwater today. Panic selling was also seen on both issues, with SMC going even beyond the 1% risk intraday. I was telling myself the entire time to endure the drawdown, endure the drawdown. What was bought on the closing should be held and sold at the closing, not during the panic selling. I think that worked pretty well as SMC recovered at the closing, hanging by a thread.

I was looking at the weekly chart of AGI and it occurred to me that the consolidation could probably extend up until the end of February. I'll decided on what to do with AGI this weekend.

SMC touched the bottom of its triangle support and it was trying to hold at that level during the entire session. Luckily, the stock recovered at the closing, safely holding up above support line.

I was actually surprised with NIKL's performance today. I was expecting the drop as it usually sheds around 6% whenever it makes a correction. But after two consecutive days of correction, it has only lost 3.75% so that would leave another 1.25% or so drop in the short term if we follow the pattern of its correction. I added another batch today at the closing. If it does drops another 1% or so, I would definitely add some more.

*I was digging up previous transactions in NIKL because I have observed INTRA-INVEST has been selling 9 days straight for the whole month of February. So I went to digging and I found out that they have around 7M+ shares from 16.50 and they have only just sold 3M shares. So if they don't buy any more shares, it will take them the whole month of February to close their entire position.

So if I have more than 100M invested, it will take me at least a month to liquidate the entire position. That's pretty interesting.

Wow, who let the dogs out? -80 points already.

Panic selling.