MEG Technical Analysis: Why You Should Wait for the 10SMACD Combo to Become Valid Again


Megaworld Corporation (MEG) is trading at 4.51 apiece, up by 3.20 percent, as of 2:25PM GMT+8 on October 4, 2019, Friday. The total turnover value is at P126.4 million.

Foreign investors have registered a Net Foreign Selling worth P46.7 million. While they are still net buyers year-to-date, know that they registered their year-to-date’s biggest one-month of Net Foreign Selling in September (P55.46 million). Also, they registered their year-to-date’s one-week worth of Net Foreign Selling in September Week 4. As far as my data is concerned, I would say that foreign fundies are not happy with what they’re seeing on MEG.

Megaworld Corporation (MEG) - Daily Chart 1 - 10.4.2019

My 10SMACD combo remains invalid on MEG.

Risk level is moderate based on its historical volatility score of 62 percent. While this is still a newbie-friendly stock, risk level-wise, please do not take this as a buy signal.

The downward force is still strong based on the DMI and ADX scores.

Support is near 4.00 while the resistance is near 4.55, which is in confluence with the 23.6 percent retracement of the Up Fibonacci.

Trade-Volume Distribution

Last Price: 4.51
VWAP: 4.467267886
Most Traded: 4.51 – 4.45
Most Voluminous: 4.43 – 4.46

Megaworld Corporation (MEG) - Trade Volume Distribution 1 - 10.4.2019

Despite the invalid 10SMACD combo, my Momentum Power Indicator is bullish as of the time of writing this analysis on MEG.

Due to this, you may skip the validation of the 10SMACD combo provided you regard yourself as an experienced and a disciplined trader. Otherwise, it’s better for you to wait for the 10SMACD combo to be re-validated.

Attend my Evergreen Strategy in Trading and Investing in the Philippine Stock Market seminar to have a crystal-clear understanding of my strategy. You’ll be able to connect the dots better and faster when you attend this unique seminar. I will teach you what you won’t find on Google.

True Market Sentiment

True Market Sentiment of MEG as of Oct-04-2019 at 02:34PM, with a last price of 4.5100.
6 of the top 10 brokers registered a positive Net Amount
4 of the top 10 brokers registered a higher Buying Average than Selling Average
True Market Sentiment: NEUTRAL
Top 10 Players’ Buying Average: 4.4719
Top 10 Players’ Selling Average: 4.4751
Bonus Info:
12 out of 45 participants or 26.67% of all participants registered a 100% BUYING activity
13 out of 45 participants or 28.89% of all participants registered a 100% SELLING activity

Megaworld Corporation (MEG) - True Market Sentiment 1 - 10.4.2019

This neutral True Market Sentiment tells me that there’s still a tug-of-war between the bears and the bulls.


If you’re a newbie trader, I suggest that you want for the 10SMACD combo to be re-validated and for the True Market Sentiment to become bullish before you decide to buy MEG. When these things happen, make sure that you calculate your reward-to-risk ratio.

If you’re satisfied with your reward-to-risk ratio, that’s the only time that you should position within the dominant range that you see on MEG’s Trade-Volume Distribution.

I and my team can help you better if you’re a subscriber of Equilyst Analytics. Your subscription will give you access to the following services.

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If you have MEG but you do not have a data-driven basis on why you bought MEG, it’s best for you to calculate your trailing stop from your entry price.

Here’s the formula: Trailing Stop = entry price x (100% – your % of risk tolerance)

If your trailing stop loss already got hit, your only logical option is to sell. But if your trailing stop has not been hit yet, I suggest that you hold your position. Do not top up. The downtrend is still more likely to continue on MEG. It’s also best for you to have access to our Private Clients Forum so you can ask for our latest analysis and recommendation on MEG (and any stock you have).

Jaycee De Guzman

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