Thursday, 26 April 2012

Yoma in distribution ? - small quick punt for a small transient bounce

4 posts or 16 days ago, dated 10 April entitled "Dumping Yoma - the perfect ecstasy moment?"  , when Yoma was galloping on a tear to new historical highs of  62-63c, I  dumped my Yoma ,  explaining that the set-up for dumping Yoma was almost perfect given the "positive " news flow and the "bullish" technicals, all carefully orchestrated or calibrated  to suck the public into buying  Yoma shares to support a good exit price for the Yoma operator to distribute or dump his shares - of course that was just my private hypothesis  to guide my trading, not yours and  I could be wrong in my hypothesis.

True to form, for the right or wrong assumptions/hypothesis, Yoma after hovering for 1.5 weeks of "distribution" between 60-63c( see chart below ) , gave way to a precipitous  fall to 50.5c in the last few days. 

Yesterday, I saw that the Yoma plunge had been quite ferocious for past 3 days  and then brought down to a reasonable support or demand  level .. I half expected the operator to find this level of 50c  sweet enough  to take  or mark Yoma up a bit to facilitate further future dumping  but was unwittingly distracted into punting what turns out to be a  very weak Kepcorp bounce which to me portends of more bearish moves to come  -see previous post : Kepcorp - a small punt for a v small bounce 

This morning , i found it not too late, an opportune moment to partake in that  "half " expected "mark-up" by the Yoma operator   ... so i decided to take a chance to enter , considering that the risk -reward is in my favor. 

However, being a total outsider , I was not very sure of the operator's  exact true intentions for the medium term so I decided to only do a small quick intraday punt , in at 52c and out at 57c at which price and time I felt  the price "mark up"    has somewhat run out of steam for bearish reasons that I am at no liberty to discuss here or now  but which we shall see being played out in next few weeks.  

Side note:  I saw that the price action  on Kepcorp today was not to my expectations and realised I had made an error of judgement in not taking the dividend  effect into account  ,  so I  dumped my kepcorp wrts bought yesterday ,  at 13.5c which is  0.1c above my buy price, just enough to pay for the brokerage fees.. feeling lucky to get out alive on this one. 

Wednesday, 25 April 2012

Kepcorp - a small punt for a very small bounce

 2 posts ago( Kepcorp gets bog mojo from Brasil) ,    I dumped my Kepcorp wrts immediately on waking up to good news that Kepcorp  had received its biggest oil rig contract to date...

While mainstream technical analysts are rushing to upgrade their technical targets on Kepcorp to >$12+ following this news , I dumped my kepcorp.. see below for an example of such an upgrade from a local technical analyst who apparently got sucked into the euphoria in his technical analysis  :
For those who emailed me for the reasons why I dumped immediately upon such good news , I gave a few : 

Question 5: why did I choose to dump as soon as I woke up to the news of the deal while mainstream media technical analysts are rushing to  upgrade their  technical targets for kepcorp to  > $12++. following  this news  ?
Ans:  I assume rightly or wrongly that many insiders have collected a lot of kepcorp stock on credit in anticipation of this very moment of announcement .  They have to dump on the news because (i) they are on credit and have no reason to hold forever (ii) maybe  they do not expect any more good deals of such size to be announced anytime soon ..(iii)  those outsiders who bought on contra just before the deal announcement ( like me) and those outsiders who bought on contra on the day after the announcement will have to dump when  forced selling day comes. (iv) the dow can turn awry anytime , in fact I expected the dow to turn bad that very same Friday nite  , which it did down 1% so what is the point of holding on esp over a weekend   (v) lastly , kepcorp has hit close to my technical target which is $11.66 from  which i expect a  a strong downward reaction or fall .

True  to form , Kepcorp went up slightly ( 4c up) to 11.68 for 1 day after I dumped before it plunged to a low of 11.05 today  ( see chart below)  not withstanding a tax-exempt dividend of 26c awarded yesterday nite .

Today I saw that Kepcorp had plunged ferociously  "enough" for the moment  and it was time for a small bounce ( strictly yesterday was a much better entry with the 26c dividend , so I am being late here in my entry today )   so  anyway I accumulated 300 Kepcorp wrts for an average price of 13.4c, which happens to be exactly the average price of the 700 lots I bought just hours before the announcement of the super deal 10 trading  days ago and subsequently sold for 16c the very next morning for a profit of $18k  ( see last post for contra statement )  . 

If I had fallen in love with Kepcorp over that superdeal news and held on to my wrts for 10 trading days til now  - it would be all for nought( ie. 13.4c stays 13.4c over 10 trading days as if the big oil rig contract announcement and 26c dividend didn't exist) .

Am I expecting another gap up tomorrow to 16.8c like that day of the superdeal ? No,  I expect the US markets to go up  slightly tonite on yet another blow out quarter from Apple ( announced last nite after US market close ) so that gave me an idea or motivation to punt for  a very small bounce tomorrow to earn some shopping money  just enough to buy an ipad3 or two   . 

Tomorrow ,  I will dump two thirds of my wrts as soon as Kepcorp hits 11.20-25 and one third  at 11.35 if it comes my way. 

Of course if   Kepcorp price action over next few days  does not conform to what I expected, I will react accordingly including cut-loss if necessary.

Friday, 13 April 2012

Kepcorp gets big mojo from Brasil - spending one night with 750 lots of kepcorp warrants

Today, Kepcorp announced what is probably the biggest oil rig deal clinched in her corporate history .. a USD 4.12bn letter of intent to build 5 semi-sub oil rigs for Sete Brasil , owned by  Brazil's national oil company- PetroBras..

For some months I have been tracking the chart of Kepcorp  , probably the bluest of Singapore blue chips. 
Observant readers of my past trades would have noticed i had always kept  2 Kepcorp wrts on my watch list.  

In a post dated 6 Mar , I noted that Kepcorp had responded to my short term peak of $11.10 and crashed down 50c from there. I reproduce the old kepcorp  chart with its old annotations in that post here. 

In the same post , I also noted that her little twin sister company Sembmarine had responded to another of my short term peak of $5.40 , overshot by 6c and then crashed down,  coincidentally also by 50c  right after an announcement that Temasek holdings is trimming a 3% stake in sembmar. I also reproduce the old sembmar chart with its old annotations in that post here. 

Then came last Friday and this Monday , Kepcorp made its first attempts to cross $11.10 but failed towards market close  .( see kepcorp chart below)  

On Tuesday , kepcorp finally crossed the $11.10 barrier towards the closing minutes of trade to close at $11.14 and I took notice.

Now, on hindsight with this USD4bn deal , I suppose some kepcorp operator or insider must have got wind of the impending announcement of the deal and decided to buy at all costs, nevermind one or two days too early and nevermind if his buying towards close caused a technical false breakout ahead of a 200 pt Dow crash and nevermind if what he is doing complies with MAS rules of a transparent market and level playing field.

Probably the insiders are rodeo cowboys from Brasil and they didn't know what MAS stands for and didn't care.

I was not tempted to enter on tues despite noticing the breakout in the closing minutes.( email me for the reasons)  This is despite the STi demonstrating much gung-ho strength all day to close at day high for a gain of almost 1% on tues. 

True enough , that tues nite the Dow came crashing down 200+ points .

Kepcorp's reaction on the next day to the 200 pt Dow crash  was very interesting.... 

 (  email me for what i observed. )

Now if you have not seen "relative strength" in action before , this is the USD 4bn poster moment to watch. It tells you something big & positive  is about to happen with the stock but exactly what that might be, I haven't had the slightest clue and I didn't care.

On Wed nite, the Dow rebounded about 1%. 

The very next day, in the morning I did not participate in Kepcorp partly because I had some chores to attend to .. and partly because I was distracted by some shorting opportunity on yoma at the open at 63c and covering back at 60c. see prev post on dumping yoma 

Kepcorp opened at $11.09 and stayed below $11.12 all morning . By mid afternoon , probably with some encouragement from china ( up >2%)  and HK,  it started to show signs of breaking out again but was blocked by one big sell queue block of about 340 lots  at $11.20...

While waiting for this big block to clear,   I realised something .. ( email me for what it is)   So without hesitation,  before any breakout north of this $11.20 block , I quickly accumulated about 300 lots of   "in-the-money" Kepcorp MBeCW120702 wrts at about 13.1-13.2c from 1430hrs - 1500 hrs ( see below order book) .
At 15:18:04 , one kepcorp operator  found the time ripe to snap up the 340 lots at $11.20 on the sell queue. 

What motivated him to do it ? - i don't know me for some ventured guesses. .

At any rate, whatever the reasons, immediately once the big block was cleared , without the slightest inkling of the deal, I averaged up and bought another 300 lots at 13.3c -13.4c.  and towards the close, I averaged up further and bought another 100 lots at 13.9c making a total of 700 lots at avg price of 13.4c .( see above order book and below trade summary  )

Towards the close,  I noticed the other kepcorp wrt on my watchlist , kepcorp  BPeCW120703  also exhibited some participation , this one had an "out-of-the-money" strike price but being very late into the game for this wrt  ,  I took only100 lots at 11.1c .

But soon after my purchase , I noticed the wrt was behaving a bit erratically against the underlying price change .  Immediately I cut loose 50 lots at the same price that I bought. True enough the very next day , the bid-ask spread of this wrt widened from 0.1c to 0.2c .

Today due to some drowsy flu medicine I took last nite, I woke up late at about 11am , blissfully unaware of any kepcorp news .  When i switched on my pc screen, I was pleasantly surprised to find that Kepcorp had gap up to $11.64 soon after open , up a whopping 40c. The overnite Dow had also rallied >1%. 

 A quick and dirty calculation tells me my kepcorp wrts should translate to a gain of 2.8c from 13.9c close yesterday which it did soon after open to 16.8c..( see day high of wrt  in third item of watchlist below ),  

Upon further checks , I realised kepcorp had announced the deal last nite .. if only i had known ..i would have woken up early to dump,  flu or no flu.. 

At any rate ,  I dumped my kepcorp wrts in double quick time after reading the news,  at a respectable price making some 19% return on my capital in just one nite. It could have been more at 30% return , but then sleep is just as important.

Why did I dumped as soon as i woke up to the news ? email me for the reasons. 

To that effect , in my dumping frenzy,  I accidentally shorted 300 lots of the kepcorp BP wrts  at 13.7c only to cover back after a drop of only  0.2c.( see above trade summary on the right column intraday close P/L )  It could have been more if I had waited longer ( it eventually closed at 13.1c , see second item in above watchlist ) but then it was lunch time and I didn't like the erratic widening in bid-ask spread of this wrt.

At the same time , while dumping kepcorp, i noticed little twin sister sembmarine today is climbing up more than kepcorp - percentage wise,  despite no announcement from sembmarine. (see percentage gain from kepcorp 2% vs sembmar 2.7% in above watchlist at market close )  

Nonetheless towards close the sembmar rally also lost some steam and fell back without breaking my $5.40 barrier. 

Are there some expectations from sembmar operators of an impending announcement of similar magnitude from sembmar ( some analysts were expecting some drillships from Sete Brasil )  like kepcorp's ( 5 semi-sub oil rigs ) or  is it just pure mimicry / sympathetic move in action ?

This , we will find out hopefully by next week. 

 I am not too hopeful of any big deal announcement from sembmar anytime early next week (   email me for the reasons ..) but i may be wrong let's watch.... like a hawk on its prey and react accordingly .

*for answers to queries above, please email to   .. put email subject title as "Queries on post : Kepcorp gets big mojo from Brasil - request from xxx yyy "... insert your name: xxx and hp no: yyy  if you want into the subject title..  otherwise leave it as xxx yyy..  TQ.  

contra statement appended 18 April 

Tuesday, 10 April 2012

Dumping Yoma -- the perfect ecstasy moment ?

In my last post dated 1 april , I mentioned the issue of dismounting from Yoma, having rided it for so long.( see 26 feb post :Yoma may rise to 52-54 after retrace to 38/39.)

  This morning presented an unique opportunity  for me to dump my wonder  penny stock called Yoma.

 For the first time in its history, Yoma was featured in the cover story of the Edge  magazine, over the weekend, with the economic liberalisation and lifting of sanctions on Mynamar as the exciting  backdrop . Yoma was seen or heralded as the " maverick" , " Rising star of Mynamar "  , the proxy gateway to the "last frontier" of growth  for local players...

 Add to that , the public was waiting with bated breath the announcement of sgx approval of Yoma rights issue which they hope to participate.  Thus , newsflow-wise ,   the public was maximally bullish over this stock.

If I were  the Yoma  operator or retail punter , I could not find a better time to distribute or dump my shares now or over next few days .

Technically, I could not find a better moment to dump either. Yesterday 
we had Yoma breaking previous  historical high of  57.5c to close at day high of 60c. Then this morning Yoma opened gap up to 62c. 

Thus we have the perfect  "ecstasy" moment for this stock as it would have activated the "buy" signals of many trading systems that are used in the local market that rely on buying on breakouts of  historical or recent highs , or bullish crossing/sloping of moving averages , MACD, stochastic, RSI , ADX or whatever "proprietary"  single mom or double pop indicator one could find in the education market leading the public to jump onboard or add more this morning.

Many trading systems that rely on candlestick pattern recoginition would have activated a buy signal after yesterday market close given the long green candle yesterday leading the public to buy this morning acting on that "super-bullish" candlestick pattern detection.

Given all these circumstances, the set-up for dumping Yoma was almost perfect. Add to that I had expected the Dow to perform badly tonite, so i dumped my remaining Yoma holdings, all 600 lots, soon after open at 61c.

However I may get in later if Yoma corrects to some reasonable level ( maybe at 50c punt for a small transient bounce ?   ..and maybe during the rights period as well  ).

** Disclaimer --   this are just my private observations or hypothesis to guide my trading , not yours...... and I could be wrong  in my hypothesis ...   so read at your own risks.

Sunday, 1 April 2012

Riding & dismounting my two horses - Yoma and Ezion

In my 26 Feb post ,  when Yoma was trading at about 42-45c,  i suggested that Yoma might be ripe for accumulation after some retrace first ,  maybe to recent lows of 38/39c ( which it did retrace to after 7 days ) with potential for rally to 51-54c.  Last Friday we actually hit 51.5c day high but after a one month wait.  

 But I have a confession to make  ,, after Yoma broke out of 44c, I wrote in a 15 Mar post -"Yoma finally breaks out"  that I will dump two thirds of my holdings at 47-48c because I had expected a downward reaction there. leaving one third for ride to 52-54c.  

 ..for how long , I don't have a clue but in the process of dumping frenzy , I dumped almost all,  about three quarters of my Yoma holdings as I do not want to sit through the corrective reactions which can be psychologically upsetting and affect my deployment of capital into other more nascent breakouts.. for which later Ezion turned out to be one of them ( see last post " Ezion breaks out "  ) .

On friday morning I had an inkling  the Dow is going to be good on friday nite ( this was borne out later by Friday's Dow which went up 66 pts ) , ..... that should set us up for a good opening on following  Monday morning .

So I asked myself  on friday morning - what stocks should be ripe for a breakout to exploit a good Monday opening ?  Yoma readily comes to mind as it suffered a false break south to 46c the previous day... 

I also decided not to dump two thirds of my Ezion though it hit my intermediate target of 99c -$1 ( see last post trading plan - "Ezion breaks out" ) as I wanted to exploit the good Monday opening to dump.

When Yoma passed 47c with strong momentum on Friday morning  , I quickly accumulated 600 lots of Yoma at average price of 47.5 , about the same avg price I dumped my Yoma the last time.

Much as i hated the exhorbitant broker fees of local brokerages,  I do not mind suffering the extra brokerage fees as a result of trading in and out of critical price levels because I wanted to deploy my capital efficiently but more importantly I do not like to suffer reactions.

True to form , Yoma surged to 51c  three hours after I got onboard . 

Now what is the exit strategy for Monday's action   ?   I will dump three quarters of my Ezion at about 99c-$1 as originally planned , hoping to ride the remainder to 1.07/1.09 and dump two thirds of my Yoma at 53-55c. I may buy back some Yoma later for the rights for which i do not  yet know the ex-date. 

Of course the price action on Monday may prove my tape reading is all wrong and I shall react accordingly.