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Tortie Portfolio: 10/8/2006 Update
Friday, August 11, 2006

The portfolio had undergone quite some changes since the last update. PELIKAN which was bought on 20/7/2006 continued its upwards trend and was in the money soon. However, once it reached its resistance at RM3.20, it failed to break through again. The volume also shrunk. On the chart, it looks like forming a 'double top'. So our acting managing director decided to sell it for a chicken-feed profit, about 5.25%, not too bad actually.

The cash rich portfolio purchased BKAWAN, SCICOM and KOSSAN on 3/8/2006, 7/8/2006 and 7/8/2006 respectively. All intended for medium to long term holding, at least initially.

However, sensing that the market is wanting a correction badly, FEAR began to creep in. Seeing that both SCICOM and KOSSAN's price movement showing a weakness, our acting managing director sold them, again for a small profit.

MAYBULK is another story: the stock made a nice rally, with both price and volume breakout on 8/8/2006. The next morning, again, weakness in upwards movement was sensed. So, our acting managing director decided to take profit. 11.7%, not too bad. But that didn't stop our acting managing director from banging his head when the buying interest surged on that afternoon and pushed the price to RM2.40, which is the immediate resistance level, before closing at RM2.37. MAYBULK failed to break RM2.40 again on 10/8/2006, with slightly contracted volume. (The price reached RM2.42 very briefly in the morning, but retraced soon after that).

So, currently the portfolio is about 30% cash and 70% equity. Expecting market correction to come any time, we are likely to further increase the cash position. We don't really practise 'last in first out' policy; but BKAWAN could well be the next 'casualty' :)

Retrospectively, buying PBBANK-01 on 2/8/2006 could be a wrong timing. Should be more patient next time.


posted by winpulse @ 1:53 PM, ,




Tortie Portfolio : Atypical 'Head and Shoulder'

While monitoring the share price movement of Maybulk, I noticed an atypical

'head and shoulder' pattern of the stock which was formed early this year.



From February to March, it looks like a 'failed head and shoulder' which was unable to
break through the neck line. That resulted in the subsequent 'second head' (?) (Any
better suggestion?) in April. However, the neck line was broken on 19.4.2006, the very
ex-date of the fat dividend. And the subsequent decline corresponded quite well with the
predicted range (Well, textbooks say 'at least', but you can not expect real life to be so
mechanical, right?) The whole 'thing' took 4 months to complete, followed immediately by

a healthy rebound and recovery. This is fair to a good stock like Maybulk.

I think this is an interesting case study for technical analysis. Everybody with slightest
knowledge of technical analysis knows 'head and shoulder' (not that anti-dandruff shampoo).
But recognition in the real life could be a challenge. Some might not agree that it was a
variance of ''head and shoulder', some might agree with me. The point is, whether one can
see the pattern and use that recognition to correctly predict the subsequent price movement? That's the whole idea of Technical Analysis, right? :)

Happy trading.

posted by winpulse @ 1:49 PM, ,