Selling into Greek Election Euphoria : Gold , Yoma, Kepcorp, HSi

Now for some hindsight reasoning for the "supporting" fundamentals  : 

For the past 2 weeks, the big boys had been buying into this one-month-plus-long fear called "Greek elections" probably in anticipation of  either a pro-bailout victory or massive liquidity injection by central banks in case of a pro-blackmail Syriza party victory     .... 

By aggregating possible votes to be garnered by the pro-bailout  parties ( New Democracy and Pasok plus a few smaller parties ) , votes that they estimated from pre-election polls , the bigboys had probably figured out  that pro-euro parties will have enough votes to form a coalition either way and this explains the little rally we saw last week .. 

Add in a little pressure from ECB , to create liquidity events in Greece through bank runs & empty ATMs &  suspended credit for supply of basic utilities & essential goods from rest of europe , ECB had apparently convinced the Greeks that their  endless game of chicken has been played too far for their own good  ..  and this little appetitiser or rehearsal  to "drachmageddon" is just the beginning  of something much bigger if Greeks vote for more blackmail  ...

Now that the election is over and the public is at maximum euphoria ( though   bailout-addicted greece will continue to demand  further bailouts & no austerity until they are eventually kicked out of eurozone  maybe after german elections )   ,  i guess today is  the time for the big boys to sell into strength  what  they  accumulated in last 2 weeks for this moment of  election results  .. 

now for the actions taken on technicals  :

2 weeks ago in early jun ,  the dow & hsi  & gold had hit a nice bottom... I bought some gold n euro  - made some, cut some at break even ..  I  bought  again some Gold on retrace recently ( see last post )   at 1581 ahead of  the "massive liquidity injection post greek elections "  rumour    ( actually it was purely the  charts that told me to enter , not the news flow  of which i can only know after the event    )  ... I  got out my first half  at 1624 and then final half at 1630  as planned last friday( see chart in prev post - again it was charts that told me to get out , not the greek elections )   before Gold spiked down this morning to 1616 briefly after Greek elections.. but it had  recovered somewhat since then ..maybe in anticipation of coming  fomc this week .. 

I went long on friday with some small  amount of  HSi call wrts, kepcorp wrts, yoma ( but  i have not found time to post this part over the weekend  ) 

When HSi & dow futures   hit my euphoric supply levels this morning at open on a big gap up ( 19620 for hsi futures, 12800 for dow futures )  ,   i could not help  but dump all my longs acquired last friday  & go a little short  ( see below )   --  short i did  at about  9.15am hsi open with a small amount of  HSi put wrts  & hoping to cover tomorrow at a small profit ..

.

QE3 play before Greek elections : Gold

Gold entry on  demand  at 1581 ( see bottom-left white zone  & center-top of  price ladder  )  , exited half on 1624 ( second top white zone  & price ladder  )   .. hoping to ride remaining to 1630 ( see topmost  white zone) before Greek elections ..

QE 3 rally or dead cat bounce ? 3 charts : Yoma , Gold , Kepcorp

Yoma selling plan -  to take half profits at 43.5 (  8 jun update --  sensing strong supply at 43 yesterday morning ,  i sold 2/3 of my yoma  soon after  open  yesterday 7 jun  at 41.5-42     - see order book below-bottom most pic   ) and then progressively sell remainder   towards 15 jun - last day of rights trading  and for those with guts towards  22 jun , last day of rights share subscription --  Note Greek elections is 17 June   

see today's chart immediately below and compare with yoma chart from  2 post ago 31 may : " Riding on  yoma rights"

31 may yoma XR - adjusted chart above

29 may yoma pre- XR chart above

QE3 ? Gold breaks out ! entry = USD 1620,  next target -- USD 1640( taken half profit at 1640 n other half stopped out at 1620  updated 7 jun 2012  )  then 1650 per oz

Kepcorp bounced off my 2 recent bottoms ( $9.90 & $ 9.90 ) with some precision though I made a bad call for a dead cat bounce  to $10.50 recently 

see chart immediately below from  8 may post  and  today's chart -  bottom most chart - of course this does not preclude more deeper bottoms to come as european crisis gets worse  

yoma sale done on 7 jun  - updated on 8 jun

Riding on Yoma rights : a quick punt on a quick pump

 See 2 posts or 3 weeks  ago, while  yoma was plummeting on its way from 63c to its eventual 35c bottom ,   I mentioned  "I suspect the operator may be tempted to attempt re-pumping Yoma at 38/39c  but I doubt he  can overcome the  bearishness in the general market . .. so let's watch closely .."   


 Eventually it hit a bottom of 35c and then hover around a basing of  38/39c for a few days ( see chart below )  when the general market found a temporary bottom in the recent crash following the recent failed greek elections. 


Admittedly I was not monitoring yoma in the recent crash post french-greek election as I was preoccupied with playing the  euro & HSi  ,  .. in fact i had removed yoma from my stock watchlist and populated it with hsi wrts about 2 weeks after I dumped my yoma shares , almost at its peak at 61c - see 10 April post "Dumping Yoma - the perfect ecstasy moment"  and  also 26 april post "Yoma in distribution?"


So when yoma declared its cum-rights on tues,  I was totally unaware ..   it was only after yoma rose 7c to 46c that day, thrusting it to the top 20-%-gainers list  that I took notice of its cum-rights declaration..  


Immediately , I added yoma back to my watch list & gave it the front-row seat it deserves ..


But I did not want to give chase after a 7c rise  .. as i  do not believe in chasing an extended move . I needed a good entry & patience is the name of this game..


However I was cognizant or mindful  of  the operator's  determination to pump or markup the stock  skyhigh for a successful rights issue  despite volatile market conditions ..and I am more than happy to ride along .


To that effect, in the  last post  ,  I suggested that yoma operator may push Yoma to 50c or more .. despite volatile market conditions  as depicted in my yoma chart with my predicted annotations from that post  shown below :

Yesterday Yoma retraced 4c to close at 41c ( see  low vol last  red candle in bottom most chart ), after the HSi  crashed 2%,  giving me a foretaste of the dow nite to come.   and plunged the dow did , plummeting some 1.2% last nite.


This morning was ex-rights date for yoma -- meaning those who bought yoma from today onwards will not be given the rights ..but can buy it on open market starting next week (7 Jun 9am) til 15 Jun 5pm    if so desired.


 But i was unaware of this before market opens , thinking ex-date was 4 june next monday.


So when yoma opened this morning at 33.5c ( yesterday close was 41c ) , I was initially taken by surprise but not many seconds passed before i noticed that Yoma had graduated, changing its tag from  "CR" to "XR"  ( see watchlist below )   -- so yoma had gone ex-rights  today . , hence the downward adjustment in price from yesterday's close of 41c.


Luckily for me , on my yoma chart , yoma price was adjusted for this XR event and i noticed it opened exactly at yesterday's close.( see bottom most chart )


This morning , I noticed the hsi will open gap down near  temporary demand & gold was turning up & the euro/usd had already hit my temporary demand at 1.237 and then enjoying a short-covering bounce( or dead cat bounce ? )  to prepare for an eventual next short-term 1.220 then 1.200  for eur/usd over next few days(weeks?) .


To this end , I  had shorted the euro last nite on a very late entry at 1.240 & took one  third  profits at 1.237- a reaction level , hoping to carry the rest of shorts  to 1.230 (  on fri,  I took another one third profits here @ 1.230 -  another reaction level  and  the remaining third was stopped out at 1.243  - updated 2 june  )   then 1.220 then 1.200 and eventually to parity ...  ( see eur/usd ladder below )  ... 

So with the "dead cat bounce "  tailwind on my back, when i noticed yoma price started turning up again a few minutes after open  ,  I took 300 lots at market at average price of  34.5c.  It eventually closed at 40c, after hitting a high of 41c ..( see below)  

Below , I show 2 yoma charts - the first one was my annotated chart in tues post depicting my predicted trajectory for yoma price , the other is the chart of actual yoma price adjusted for ex-rights in today's chart  ..  The two trajectories look like spitting images of one another if one were to look at it with reference to the corresponding orange horizontal lines on the 2 charts ...  

tuesday chart above with prediction trajectory upon cum rights declaration


today's( thurs)  yoma chart below with price adjustment for ex-rights, note similarity with above chart  between predicted & actual trajectory.- make reference to corresponding horizontal orange lines between the 2 charts.

I am mindful that the purpose behind all these pumping action is to persuade existing entitled holders of rights to subscribe for rightshares( entitled & excess )   and to attract buyers for yoma rights that will be offered on open market next week starting7 jun & ending 15 Jun 5pm  with the view to their eventual  exercise or subscription at 24c on 22 jun 5pm .. 


after that , the operator may have no strong incentive  to support yoma stock price anymore for some time to come  so I will try to evacuate myself , quietly head for the fire exit  before the clock strikes twelve  and not be left holding the  baby & bath water ..


at any rate, we have the Greek elections on 17 June  and there is no telling what the Greeks will do in this endless game of chicken , blackmail , trojan horses  ...  with a messy divorce of epic proportions on the cards  & Spain as the final battleground to decide the fate of the euro,  the recent market crash has yet to run its course , the nite is long &  the road ahead  bumpy so it is best to err on the side of caution if you are on a risk-on trade .


Disclaimer :  Of course the above is just my private hypothesis for my private consumption & not yours  and I could be wrong .. so  caveat emptor..


** updated 2 jun --  some friends have asked me for details of the rights offer , **disclaimer - I bear no responsibility for any errors of mistaken or omitted facts or interpretation below, so read at your own risk n do your own diligence  :

 RIGHTS OFFER OF 4  FOR 5 @ SGD 0.24 

meaning for every 5 shares you bought  before 31 may  , they will give you  4 rights & for each right , you will have to pay 24c to get a new yoma share( called rightshare) by 22 jun 5pm .


 So if  you have 10 lots of yoma before XR (31 may), you will be getting for free  8k rights for which you will have to pay 24c x8k = $1.92 k  to convert your right shares into 8 lots of new yoma shares by 22 june 5pm.


 if you got rights thanks to your entitlement  and not intending to pay 24c  per share to convert them into new yoma shares , you should sell the rights into the market when they start trading on 7 jun on the SGX exchange otherwise they become worthless when the trading of rights stops on 15 June 5 pm and you still don't want to convert  by 22 June 5pm..


If you want to apply for  free excess rights( this is available  to people who held at least one yoma share before 31 may and if there is net left over of rights from net under-subscription  as of  22 jun 5pm ) & convert them to shares , you can also fill in the form sent to you  and submit with payment ( 24c per excess right applied for ) by 22 June 5pm or through electronic means(ATM) stated below.
  

Important Dates and Times

Entitled Shareholders and Purchasers should take note of the following important dates and

times in respect of the Rights Issue:

Despatch of Offer Information Statement : 7 June 2012

(together with forms) to Entitled Shareholders

Commencement of trading of “nil-paid” Rights : 7June 2012 from 9.00 a.m.

Last date and time for splitting Rights : 12 June 2012

Last date and time for trading of “nil-paid” Rights : 15 June 2012 at 5.00 p.m.

Last date and time for acceptance of and : 22 June 2012 at 5.00 p.m.

payment for Rights Shares (9.30 p.m. for Electronic

Applications)

Last date and time for acceptance of and : 22 June 2012 at 5.00 p.m.

payment for Rights Shares by renounces (9.30 p.m. for Electronic

Applications)

Last date and time for application and payment : 22 June 2012 at 5.00 p.m.

for excess Rights Shares (9.30 p.m. for Electronic

Applications)

Expected date for issuance of Rights Shares : 29 June 2012

Expected date for crediting of Rights Shares : 29 June 2012

Expected date for refund of unsuccessful : 2 July 2012

applications (if made through CDP)

Expected date for the listing and : 2 July 2012 from 9.00 a.m.

commencement of trading of Rights Shares



PARTICIPATING BANKS FOR ELECTRONIC APPLICATIONS THROUGH AN ATM:
1. DBS Bank Ltd. (including POSB)
2. Oversea-Chinese Banking Corporation Limited
3. United Overseas Bank Limited and its subsidiary, Far Eastern Bank Limited




The Company has obtained a written irrevocable
undertaking from the Undertaking Shareholder to, inter
alia, subscribe and/or procure subscriptions for (a) his
pro rata entitlements to 211,148,414 Rights Shares
(direct and indirect) under the Rights Issue; and (b) up to
168,018,254 of the balance of the Rights Shares which
are not subscribed or applied for by Entitled
Shareholders other than himself, which will amount to
S$40,324,381.

testing123xxx

Rebound or Dead Cat bounce ? : STi to retest 2826 , Kepcorp may test 10.50, Yoma finally announces cum-rights & operator repumps Yoma at 38.5c to support it.

At the start of the recent mini-crash after the French/greek elections 3 weeks ago, I predicted a bottom for that leg of the crash for the Sti at 2799. In the end , it went down to 2759, a 40 pt under-estimation on my part so there is some more fine-tuning work to do here .  This rebound ( or dead cat bounce which many analysts had called this bounce  )  should take STi to 2826  & then maybe 2877( a long shot ? ) .. failing which we may see another bout of  plunging .. so let's watch closely for any sign of weakness .  

In the last post  3weeks ago , I mentioned "  I suspect the operator may be tempted to attempt re-pumping Yoma at 38/39c  but I doubt he  can overcome the  bearishness in the general market . .. so let's watch closely "... it subsequently sank to a bottom of 35c which was close  to my second last reaction levels of 36c..( see below chart ) 


Now that the market has found a temporary bottom , true to form, today the Yoma operator finally decided to exploit this window of opportunity   ( which may not last )   to do a strong re-pumping from 38.5c  to 46c all on one day  - see super-long green candle in chart above -  in a superfast markup ( with just a 1m share buy at 39c at 9.20am & 1m share buy at 41c at 9.52am  - leading one to  wonder if these transactions are anything but ...   )  to support the announcement of cum-rights issue( ex-date 4 June which is next Monday ) ( sorry , i got  the ex-date wrong, it is 31 May ,  record date is 4 Jun so the rights will be traded next week  )   


 I guess  the operator may further pump it to 50c  or more in another superfast mark-up( maybe towards friday close  if market sentiment is any good or during the ex-right period to ex-right equivalent price of  38.4c or more  )   to persuade the public to buy more rights & subscribe to the rights  at 24c   .. of course this could be a long shot in this difficult environment   & I could be wrong here .. so let's watch closely.


 If yoma maintains current price of 45c , ex-right yoma price would be 35.6c on Monday assuming market sentiment remains constant  which may be able to persuade people to fork out 24c to subscribe...  if  operator had allowed yoma to plunge to 29.5 level ( see last post's chart below  ) ,  the ex-right price would be 27c which is too close for comfort for rights subscribers in this volatile environment. 


but of course buyers beware , once the rights are exercised by the public and 24c is collected from the public , the operator may have no strong incentive to support yoma share price anymore for some time to come  for a variety of reasons too complicated to discuss here and now  ....

 ... Kepcorp 's recent crash to bottom  exceeded  my first crash target of $9.90 in last post ( see below ) by 10c and 20c short of my over-pessimistic  final target of $9.60.   may hit 10.40-50 in this rebound ( or dead cat bounce  ? ) .. so cross fingers  & watch closely for any sign of weakness..

the Edge chart analysis on Kepcorp  

STi in wake of French/Greek revolt & Two charts from the Edge magazine : Yoma & Kepcorp

Over the weekend , I flipped through the latest edition of The Edge magazine ( for week may 7 -may13) and saw a chart analysis on Yoma by The Edge's technical analyst   who said  she had a confirmation of  a topping formation in Yoma and she expected Yoma , if it breaks down from 50c , ( which happened yesterday, Monday 7 may  )  to hit 27c after some  upward reactions at 40c, I reproduce her analysis here :

Recalling my 10 April post on "Dumping Yoma - the perfect ecstasy moment? "   , I had already expected Yoma 's breakdown  when it was still trading at 60-63c  ( see last post " Yoma in distribution? "    ) and to have a fall with weak upward reactions  or corrections at 50c, 46c, 42.5c,  36c and 29.5c like in chart below .

We shall watch with keen interest which  way or trajectory the Yoma operator is going to operate his stock - somewhere in between the Edge's 27c target trajectory and mine or something totally out of whack from  our both of our  expectations in which case we will have to adjust our  expectation trajectory accordingly. I suspect the operator may be tempted to attempt re-pumping Yoma at 38/39c  but I doubt he  can overcome the  bearishness in the general market . .. so let's watch closely ...  -- see below STi trajectory.


I also saw from the previous week's Edge magazine ( for  week of  april 23-29),   a chart analysis of Kepcorp when Kepcorp was trading at $11.55 . I also reproduce their analysis here, which seems to me somewhat overbullish at that moment ( see my analysis in 25 april  post  and 13 april post "Kepcorp gets big mojo 
where I mentioned insiders and smart money are selling like no tomorrow ( and to that effect , I  showed a contra statement of my dumping with Kepcorp@11.62   ) while the public and mainstream technical analysis or indicators are sucked into the  ecstasy and euphoria  over the  USD 4 bn contract  news,  strongly tempting technical analysts to  upgrade their 'technical' targets to $12 or more,  like below )

In the same issue I saw a more "muted" or balanced article on Kepcorp " Orders boom for Kepcorp but margins and upside muted " by Kang Wan Chern , I reproduce part of the article here, which somewhat corresponds more to my sombre or bearish  view at that time ( see my analysis in 25 april  post     and 13 april post "Kepcorp gets big mojo)   

In this mini crash following last weekend's French/Greek elections calling for more stimulus and less austerity, I expect Kepcorp to hit 10.40 after some upward reaction or corrections at 10.65 .  What happens after 10.40 is subject to general market conditions which I expect to be quite bad so I wouldn't be surprised if it hits below $10, if the Greeks cannot form a coalition government by next week.. see updated STi & kepcorp trajectory below 


 In the wake of the french/ greek revolt against german austerity  and if the Greeks cannot form a coalition government by next week.. the STi may   take a slow and bumpy fall to 2833 ( updated to 2800 on 9 may ) with upward reactions at 2908 ,2879, 2857 .  The trajectory is not meant for trading the STi , they are used for aiding the trading of stocks & warrants ...This chart will be pasted inside STi roadmap 'tab' for short-term reference.

  **************************************************************


updated kepcorp chart 11 may 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. 

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.