BLOOM: Forming a potential bullish harmonic pattern

Bloomberry Resorts Corporation

BLOOM is potentially forming a Bullish Bat harmonic pattern. The recent breakdown from 5.5 support also gives it a higher probability of completing the bullish pattern. The Potential Reversal Zone (PRZ) is around 4.35 (4.32~4.6 range) which is near the major support at 4.00.

So far, the 8-month uptrend support line remains intact which may also act as bounce point in the short term. However, a breakdown from this trendline will also further support the completion of the Bullish Bat harmonic pattern.

Trading Plan
- Wait for the Bullish Bat harmonic pattern completion and only take position on a sign of a reversal (candlestick reversal patterns) or bottoming out pattern around the PRZ area. Stop-loss should be a few points below 4.32 or on breakdown from major support.

VITA's uptrend rally warning

Vitarich Corporation

The declining volume on the uptrend rally of VITA is not a good sign.

Rising volume is associated with the big boys buying and selling, so when the market is rising on increasing volume it is assumed the big money, also typically considered the “smart money”, is buying.  When the market is rising while volume is declining the implication is the big money is not the one buying, more likely slowly exiting positions.

*Stochastic at extreme overbought level (95+).
*RSI is also at overbought territory and potentially developing a bearish divergence pattern.

Trading Plan
- Start scaling down position or profit run with a tight trailing-stop.
- Take profit on strong reversal patterns with confirmation.

URC: Bullish Reversal Pattern

Universal Robina Corporation

Bullish Doji Star and Morning Star candlestick pattern on URC, a potential reversal signal (either a new trend may develop or consolidation will follow). Its also a potential sign of a bottom.

*RSI coming off from oversold territory - a bullish signal.
*Immediate resistance at 193.

Trading Plan
- Accumulate near the recent bottom for a position trade.

EW Breakout Play Update

East West Banking Corporation

The measured target from Rounding Bottom breakout has been hit already (22~22.5 range). The previous breakout play was detailed here:
https://psetrends.blogspot.com/2016/07/ew-breakout-play.html

*Immediate support around 19.7 while the major support at 18.5.

Trading Plan
- Scale down position if trading the Rounding Bottom breakout and profit run the rest of the position using trailing stop.
- The 4-year downtrend line breakout play remains intact with projected TP around 24~25. Adjust stop-loss accordingly.

DNL at resistance zone

D&L Industries, Inc.

DNL's price action last week has tested the resistance zone at 11.42~11.94 and formed up a minor trend reversal candlestick pattern, Tweezers Top.

Immediate support area is around the recent breakout level from its 5-month upward price channel and the previous resistance at 10.6.

Trading Plan
- Avoid for now and monitor for breakout or toppish confirmation.
- If currently in a trade, scale down position and profit run the rest with trail stop.
- Only buy-on-breakout if supported by volume (must be a breakout from the resistance zone).

CPG rally potentially stalling

Century Properties Group, Inc.

The recent rally on CPG is potentially stalling with the following candlestick patterns:

Bearish Counter Attack pattern
- considered a toppish pattern

- potential sign of stalling rally

- requires confirmation

Bearish Meeting Line pattern

- considered a reversal pattern

*RSI at oversold territory

Trading plan

- Scale down position or take profit on reversal confirmation

MWIDE Chart Update (Bearish Confirmation)

Megawide Construction Corporation

The Bearish Doji Star pattern has been confirmed today and morph it into another bearish pattern, an Evening Doji Star pattern. Pullback or consolidation may potentially follow.

Previous MWIDE analysis:
http://psetrends.blogspot.ae/2016/07/mwide-potential-bearish-pattern.html

*Resistance zone at 9.6 ~ 10.1.
*Immediate support at 9.0 (around 23.6% retracement, considered a shallow pullback level).
*Potential retracement targets are indicated on the chart.

MWIDE: Potential Bearish Pattern

Megawide Construction Corporation

A Bearish Doji Star pattern is potentially forming on MWIDE as it hits the resistance zone. This is considered a bearish reversal pattern/signal but still requires confirmation. A confirmation of this pattern will likely lead to a pullback or consolidation. Potential retracement targets are indicated on the chart.

*Resistance zone at 9.6 ~ 10.1
*Immediate support at 9.0 (around 23.6% retracement, considered a shallow pullback level)

Trading Plan
- Scale down position
- Or take profit on bearish pattern confirmation

EW: Breakout Play

East West Banking Corporation

EW on a breakout galore:

• Breakout from its 4-year downtrend line at around 18.5. Projected target from this breakout is around 24~25. 
• Breakout from its major resistance at 18.5.
• Also a breakout from a Rounding Bottom pattern with potential target around 22~22.5.

These are considered significant breakouts due to confluence in breakout levels.

*Major support now at 18.5 (previous resistance prior to breakout now becomes a support).

Trading Plan
Choose a play with at least a 1:2 risk/reward ratio from your entry to potential targets mentioned above.

SCC: Potential Toppish/Bearish Pattern

Semirara Mining and Power Corporation

A Complex Head-and-Shoulder Top pattern is potentially forming on SCC chart. This pattern is considered toppish with bearish bias (reversal pattern). A breakdown from this pattern will have a measured target price near 60~70 range.

Trading Plan
Avoid until the pattern has been invalidated.

DD on another breakout

DoubleDragon Properties Corp.

DD is on another breakout from recent Rectangle consolidation pattern. A Rectangle is a continuation pattern that forms as a trading range during a pause in the trend. Measured target from this breakout is around 43 (already hit).

Check this link for more details on Rectangle chart pattern characteristics:
Rectangle (Continuation) - stockcharts.com

The previous breakout from Bullish Pennant pattern on the daily chart also remains valid with a measured target of 49.
http://psetrends.blogspot.com/2016/03/dd-chart-update-breakout-from-bullish.html

*There's also another breakout on the weekly chart from Rectangle consolidation pattern that remains valid with measured target around 44 (breakout from 26 resistance).

DD Chart Update (trend continuation pattern)

DoubleDragon Properties Corp.

DD is again on another breakout from a Bullish Pennant pattern, a trend continuation pattern. Projected target from this breakout is around 49 (45~49 range).

*DD is overbought on many indicators.

Previous DD update:
http://psetrends.blogspot.com/2016/01/dd-position-trade.html

Trading Plan
- Hold and profit run the remaining position from previous trade (see previous DD post).
- If trading this pattern, set tight stop around 32.7 for a risk/reward ratio of at least 1:2 (to initial tp at 45).

SMC: Sell signal

San Miguel Corporation

A bearish divergence pattern on RSI has formed up as price entered the resistance zone. This is a potential sign of an impending pullback or correction to follow. RSI also gave a sell signal as it crosses below the overbought territory.

A 3-Inside Down candlestick pattern also formed up at the resistance zone which is considered as a high reliability reversal pattern.

*Selling pressure has already started but still requires confirmation (Chaikin Money Flow).

Trading Plan
- Take some profit or scale down (trail stop the remaining position).

MBT: Breakout from Inverted H&S and 11-month downtrend line

Metropolitan Bank & Trust Company

MBT is currently on a breakout from two bullish patterns with one measured target range already hit.

1. Breakout from Inverse Head-and-Shoulder pattern with projected TP = 90~92.
2. Breakout from its 11-month downtrend line with measured TP around 80~81.

*RSI at overbought territory.

*Immediate resistance area at 86~87.5.

Trading Plan

- If trading the 11-month downtrend line breakout, take some profit or scale down position and profit run the rest with trailing stop or break-even stop.

- If trading the Inverse H&S pattern breakout, set TP around 90~92. Adjust stop-loss to at least break even point.

EDC: Short term profit taking pattern

Energy Development Corporation

EDC has potentially completed a Bearish AB=CD harmonic pattern with potential reversal zone (PRZ) around 6.29 (6.21~6.38 range). The harmonic pattern also potentially completed as EDC hits the immediate resistance at 6.30.

*RSI entered the overbought territory while price failed to break resistance, a bearish sign.
*Trend remains strong (DMI/ADX).
*Buying pressure remains intact.

Trading Plan
- Wait for reversal pattern.
- Or take some profit/scale down position and profit run the rest with trailing-stop.

CNPF: Toppish pattern

Century Pacific Food, Inc.

CNPF recently kissed the immediate downtrend resistance but failed to make a breakout despite the huge traded volume. This suggest a toppish price action and a potential sign of distribution.

*ADX also indicates a potential end to prior trend.
*Selling pressure already started.

Trading Plan
- Take some profit on short term position (like take half and profit run the rest with trailing stop in case of a retest of resistance followed by a breakout).

MCP: Potential Breakout

Melco Crown Philippines

MCP is now on a potential breakout from both the 4-month downtrend line and the Inverse Head and Shoulder pattern supported by good volume with measured targets at 2.8 and 3.5 respectively.

*The 15-month downtrend line has been broken already.
*MCP bottomed out already at 1.15.
*ADX still points to a weak trend and more of a sideway price action (consolidation).
*No buying pressure yet (Chaikin Money Flow).

Previous MCP chart update containing this potential Inverted H&S pattern can be found here:
http://psetrends.blogspot.com/2016/02/mcp-chart-update.html

Trading Plan
- Buy near the breakout area.
- Set target depending on the breakout pattern (2.8 for the downtrend line breakout and 3.5 for the Inverted H&S).
- Set the stop-loss just a few points below the right shoulder's low (1.86).
- This is a high risk trade for the downtrend line breakout play as the risk/reward ratio is very small (around 1:1). Around 1:2 risk/reward ratio for the Inverted H&S breakout play.

Technical Analysis School: Support and Resistance

Support and resistance represent key junctures where the forces of supply and demand meet. In the financial markets, prices are driven by excessive supply (down) and demand (up). Supply is synonymous with bearish, bears and selling. Demand is synonymous with bullish, bulls and buying. These terms are used interchangeably throughout this and other articles. As demand increases, prices advance and as supply increases, prices decline. When supply and demand are equal, prices move sideways as bulls and bears slug it out for control.

Read more here:
http://stockcharts.com/school/doku.php?id=chart_school:chart_analysis:support_and_resistance

MEG: Breakout from Ascending Triangle pattern

Megaworld Corporation

MEG is on a breakout from Ascending Triangle pattern with measured target around 4.2 which is near its 11-month downtrend line.

*Buying pressure already started early February.

Trading Plan
- Buy near the breakout area with stop-loss at recent swing low for a risk/reward ratio of at least 1:2.

MPI: At the resistance zone

Metro Pacific Investments Corporation

MPI is now at the resistance area (6.1 ~ 6.3) and also kissed the resistance line of its uptrend price channel.

*RSI at overbought.
*Potential bearish pattern developing on Stochastic.

Trading Plan
- Take some profit (sell) at resistance area or scale down position (like selling half and profit run the rest of the position with trailing stop.

BLOOM: At make or break point

Bloomberry Resorts Corporation

BLOOM failed to break so far its 9-month downtrend resistance line and recently on a breakdown from a Rising Wedge pattern, a bearish trend continuation pattern with measured target around 2.40~2.80 area.

Trading Plan
- Avoid for now unless there's a breakout from its downtrend price channel that is supported by huge volume.
- Potential reentry in case there's no breakout would be to wait on another correction or pullback near the downtrend support line.

ICT: Diamond Bottom

International Container Terminal Services, Inc.

Diamond Bottom
The price seems to have reached a bottom, showing signs of reversal as it has broken upward after a period of uncertainty or consolidation. The Diamond Bottom pattern begins during a downtrend as prices create higher highs and lower lows in a broadening pattern. Then the trading range gradually narrows after the highs peak and the lows start trending upward. When the price breaks upward out of the diamonds boundary lines, it marks a significant reversal to a new uptrend.

Event Date: Feb 22, 2016
Opportunity Type: Intermediate-Term Bullish
Close Price: 60.00
Target Price Range: 66.25 ~ 67.50

Price Period: Daily
Volume: 2,317,850
Pattern Duration: 27 days
Inbound Trend Duration: 31 days

Analysis and Chart Source
Firstmetrosec Recognia technical event scan tool
http://fmsec.com.ph/

PSPC: Potential breakout play

Phoenix Semiconductor Philippines Corp.

PSPC on a potential breakout:

• Breakout from an Invested Head-and-Shoulder pattern with measured target around 2.
• Breakout from its 15-month downtrend line with measured target around 2.2~2.3.

*Immediate resistance at 1.94.

*It recently completed the Bearish AB=CD harmonic pattern (a potential signal to take some profit on short term position)

Trading Plan

- If trading the Inverted Head and Shoulder pattern breakout, buy near the breakout area with stop-loss near the recent swing low and TP at 2. Trade with caution as the risk/reward ratio on this setup is quite low.

- If trading the downtrend line breakout, buy near the breakout area and TP at 2.2~2.3 range. Set stop-loss near the recent low for a risk/reward ratio of at least 1:2.

- If holding a position from the recent dip near 1.30, the completion of a Bearish AB=CD harmonic pattern is a potential sign of a pullback or retracement to follow. Take some profit on short term position and profit run the rest.

FGEN: Potentially ripe for short term profit taking

First Gen Corporation

FGEN recently hit the measured target from Double-Bottom pattern breakout around 20.74 (note that the Double-Bottom pattern formed up with a Bullish Divergence pattern on RSI which makes a strong case of a high probability trade entry).

FGEN is now approaching the resistance zone around 21~22 which is around 50% retracement from the recent peak (or 38.2% retracement from October 2015 peak). The 21.1 resistance is also the previous support prior to breakdown. These convergence of resistance levels is a potential short term profit taking area for short term positions.

Bullish Scenario:
- The breakout from 4-months downtrend line supported by above average volume is also a potential breakout play. Measured target is near 25.

Trading Plan
- If trading the Double-Bottom breakout, take some profit like 50% of the position and profit run the rest with trailing-stop.
- The resistance zone shown in the chart is also a potential short term target to take profit. Scale-down short term position and profit run the rest.
- If trading the breakout from 4-month downtrend line, buy near the breakout area with stop-loss around the double-bottom breakout resistance level (around 19). Set TP near 25 for a risk/reward ratio of at least 1:2.

MCP: Chart Update

Melco Crown Philippines

MCP recently found a roadblock at the convergence of multiple resistance levels.

The Head-and-Shoulder Bottom pattern (Inverted H&S) remains valid for now. The neckline is also the immediate resistance area around 2.34. Immediate support at 1.86.

• A breakout from this H&S pattern will have a measured target around 3.5.
• Breakdown from support with price action moving towards the H&S head area will likely invalidate the Inverted H&S pattern.

Recent rally is still considered a DCB (Dead Cat Bounce) from the longer term downtrend line if it fails to break that trend.

If major support at 1.15 holds up from a sharp correction, potential Double-Bottom pattern will likely develop. A breakdown from 1.15  will confirm the DCB and price action will likely move towards new lows.

Note
This is just an update from the previous post "MCP: Potential DCB":
http://psetrends.blogspot.com/2016/02/mcp.html

Trading Plan
- Avoid for now.
- Buy only the breakout from Inverted H&S if it also breaks the longer downtrend line supported by above average volume.

TEL: Inverted Head and Shoulder pattern

Philippine Long Distance Telephone Company

Head and Shoulders Bottom
The price seems to have reached the end of a period of "accumulation" at the bottom of a major downtrend; the break up through resistance signals a reversal to a new uptrend. The Head and Shoulders Bottom is created by three successive declines in the price following a significant downtrend. The lowest low (head) is in the middle, flanked by two higher lows (shoulders) at roughly the same level. Volume is highest as the price makes the first two declines, then diminishes through the right shoulder. Finally volume surges as the price closes above the neckline (drawn between the two highs) to confirm the reversal.

Event Date: Feb 16, 2016
Opportunity Type: Intermediate-Term Bullish
Close Price: 2,280.00
Target Price Range: 2,522.00 - 2,587.00

Price Period: Daily
Volume: 240,255
Pattern Duration: 74 days
Inbound Trend Duration: 89 days

Analysis and Chart Source
Firstmetrosec Recognia technical event scan tool
http://fmsec.com.ph/

X: Head and Shoulders Bottom pattern

Xurpas Inc.

The price seems to have reached the end of a period of "accumulation" at the bottom of a major downtrend; the break up through resistance signals a reversal to a new uptrend. The Head and Shoulders Bottom is created by three successive declines in the price following a significant downtrend. The lowest low (head) is in the middle, flanked by two higher lows (shoulders) at roughly the same level. Volume is highest as the price makes the first two declines, then diminishes through the right shoulder. Finally volume surges as the price closes above the neckline (drawn between the two highs) to confirm the reversal.

Event Date: Feb 16, 2016
Opportunity Type: Intermediate-Term Bullish
Close Price: 12.96
Target Price Range: 15.00 - 15.50

Price Period: Daily
Volume: 1,291,500
Pattern Duration: 29 days
Inbound Trend Duration: 39 days

Analysis and Chart Source
Firstmetrosec Recognia technical event scan tool
http://fmsec.com.ph/

ABS: Support Play

ABS-CBN Corporation

ABS is potentially bottoming out as it consolidates near the support area (53~54).

Although no reversal pattern or signal found yet, there's a potential for position play or range trade setup.

Trading Plan
- Buy or accumulate near or at support area.
- Short to medium term TP at 60.
- Stop-loss around 51 for at least 1:2 risk/reward ratio.
- Try to scale down when initial TP is hit and profit run the rest using break-even stop or trailing-stop.

Note
- With general election coming soon this may, this is also a potential position play using that event as catalyst.

PIP: Potentially Bottomed Out

Pepsi-Cola Products Philippines, Inc.

PIP is potentially bottoming out at 2.9 as it continues to consolidate around that area.

Price congestion also shows a couple of Doji candles and Inverted Hammers - considered as potential reversal signal and bottoming out pattern when found near a major support area.

*Bullish divergence on RSI.
*Immediate resistance at 3.6 (previous support prior to breakdown that now becomes a resistance).

Trading Plan
- Buy near support (2.9)
- Near term TP = 3.6
- Stop-loss just points below 2.6 for around 1:2 risk/reward ratio.

ALI: Toppish Pattern

Ayala Land, Inc.

ALI is now potentially forming a toppish pattern with a bearish Evening Star candlestick pattern. Pullback/consolidation may likely follow.

*Immediate resistance at 33.
*Immediate support at 30 or around 38.2%~50% retracement area (29.8~30.4).

Trading Plan
- For medium to long term position, accumulate near 30 or below.
- For short term position, buy on pullback using the Fibonacci retracement levels as reference. Observe any reversal patterns around the 38.2% ~ 61.8% retracement. Avoid if downtrend momentum continues without any sign of bottoming out pattern.

MCP: Potential DCB

Melco Crown Philippines

MCP's recent rally is now approaching its 1-year downtrend resistance line. Failure to break this trendline will mean another DCB (Dead-Cat-Bounce) for MCP.

*RSI now comes off from Overbought territory (technically using a downtrend bias overbought threshold at around 55~60). This is basically a bearish bias pattern.

Trading Plan
- Avoid for now (buy only on breakout that is supported by huge volume).
- If currently holding MCP, potential profit taking area near the downtrend resistance line (or scale down position to protect some gains).

MRSGI: Approaching the Downtrend Resistance Area

Metro Retail Stores Group, Inc.

A Bearish Doji Star pattern formed up on MRSGI near its downtrend resistance line after the recent rally. This is a bearish reversal pattern but still needs confirmation.

Trading Plan
- Avoid for now and wait for a pullback near support or breakout from its downtrend resistance line (with volume) before taking any position.
- Potential BUY near its support at 2.95.

DNL: Reversal Pattern at Immediate Resistance Area

D&L Industries, Inc.

A Dark Cloud Cover candlestick pattern formed up around the immediate resistance area of 7.9 (bearish reversal pattern). Factors indicating the importance of this signal are:

1. The greater the penetration of the first candle by the second candle (yes).
2. Both candles are marabozus  (yes).
3. The second body opens above a major resistance level (yes, above the immediate resistance at 7.9).
4. High volume on the second day (no, possible pullback only).

Pullback or retest of major support may potentially follow.

*LitWick pattern reliability: HIGH

Trading Plan

- Buy/accumulate the retest of major support near 7. 

- Initial TP should be around the 7.9~8. Profit run the rest with trailing-stop.

- Stop-loss around 6.7 or a few points below it to have at least 1:3 risk/reward ratio.

*If the pullback is only around 50%~61.8% retracement, observe any reversal pattern for a potential trading opportunity.

DD: Position Trade

DoubleDragon Properties Corp.

DD's immediate support at 20 remains intact and strong. This support also falls around the 38.2% retracement which is one of the significant Fibonacci retracement levels.

*Immediate resistance at 22.

Trading Plan

Position Trade:
- Buy/Accumulate around the immediate support at 20.
- Near term TP at 25 (sell half if it hits this target, profit run the rest with trailing stop starting at 23).
- Stop-loss around the 50% retracement (a few points below 18).

Short Term Play:
- Buy near 20.
- Initial TP at 22 (sell half if it hits the initial TP, profit run the rest with appropriate trailing stop).
- Stop-loss just a few points below 19.5 for a risk reward ratio of at least  1:4.

Remarks
DD remains a long term buy (growth potential base on its 2020 business plan).

Technical Analysis Introduction

Technical Analysis Introduction, Tutorials and References

Introduction to Technical Analysis
- http://www.investopedia.com/university/technical/

Chart Analysis School
- http://stockcharts.com/school/doku.php?id=chart_school:chart_analysis

Forex Trading School 
(most topics are applicable to stocks)
- http://www.babypips.com/school

Harmonic Patterns
- http://www.harmonictrader.com/price_patterns.htm

*Updated links can be found in the "Technical Analysis" section of this blog.

ION: Range Trade Play (Range trading lesson)

Ionics, Inc.

Range trading setup on ION.

Support zone = 2~2.1
Range trading band = 2~2.3 (can adjust the 2.3 upper band when using trailing stops, doing profit run, or depending on your risk level)

Trading Plan
- Buy/Accumulate at support zone (the closer to 2 the better).
- Sell near the upper band around 2.3 (initial TP).
- Stop-loss at 1.94 (can be adjusted depending on your comfort zone for the risk/reward ratio).

Notes
- Assuming you can get it around 2 and sell at 2.3, your risk/reward ratio is around 1:5 (a probability of winning 5 times the risk).
- Assuming you got it at 2.1 and sell at 2.3, your risk/reward ratio drops to around 1:1.25 (relatively higher risk but still doable if strictly implementing the tight stop).
- Alternative profit taking method is to use a step up TPs and use trailing stop to protect gains (set initial TP > once initial TP is hit, adjust stop-loss to break-even...and move up from there in TP steps).
- Another profit taking method is to profit run the rest of the position with trailing stop after initially taking profit at first TP (use percentage points on trailing stop just below the initial TP).

Potential result
- Using 2~2.3 trading band with 1:5 risk/reward ratio, the potential gain will be around 15% with the risk of losing 3% (excluding charges).
- With 1:1.25 risk/reward ratio, potential to gain 9.5% and a risk of losing 7.6% (excluding charges).

Remarks
- The trading plan above is just to demonstrate a logical approach to range trading and avoiding impulsive buying.
- Impulsive buying usually comes with indecisiveness when to take profit resulting in a potential gain that eventually turn into a loss (gain na sana naging bato pa).
- Stop-loss is there to minimize your risk (losses) and survive to trade another day. Avoiding a scenario of a short term trader that becomes a long term investor (dahil naipit).
- Higher risk/reward ratio insures that you will potentially remain profitable over the long run despite some bad trades hitting your stops.

Additional Notes
- Never let a winner turn into a loser.
- Risk can be predetermined but reward is unpredictable (never trade without a stop-loss).

GLO: Approaching Major Support

Globe Telecom, Inc.

GLO is again approaching its major support at 1600 after the recent Double Top breakdown.

Trading Plan
- Test buy or accumulate position near support at 1600 (position trade).
- Stop-loss should be on confirmed breakdown from major support.

MAXS: Potentially Bottoming Out

Max's Group, Inc.

MAX is potentially bottoming out already at support area (see bottoming out pattern on the chart). It's also potentially forming a bullish Double Bottom pattern.

*Support zone: 19.6~20
*Immediate resistance: The downtrend resistance line, next is around 24.
*RSI at oversold territory.

Trading Plan
- Test buy or build position at support area.
- Short term TP at around 24 or take profit/cut position if it fails to break that downtrend resistance line.
- Stop-loss just below the support zone.