PLC: Hold Till 0.94 or Sell at 0.84?

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Premium Leisure Corp. (PLC) advanced today, 10 December 2018, by 9.33% which led to a closing price of 0.82-apiece. Its ascent was purely driven by local retail traders and not by foreign investors. Foreign fundies only registered a Net Foreign Buying of P54,500.00.

So what triggered the local retail traders to trade PLC today by up to P35 million?

Just like many traders, I’m sure that’s one of the questions you’d like to ask.

If you’ll ask me, I don’t really care what triggered a stock to go up or down as far as my being a pure technician (bias on technical analysis) is concerned when I do short-term trading (because I do fundamental analysis when I do long-term investing).

When I am in a pure technician mode, the end-of-day data already paints the whole picture of what the market thought about the stock today and what they could probably be planning for the next trading day.

Do I bother checking PSE Edge to check disclosures when I do short-term trading?

I do not. I only look on three things.

  • Candlestick Chart – I check the support and resistance levels. Sometimes, I refer to convergence or divergence of the moving averages. But knowing the support and resistance levels of a stock is sometimes more than enough for me to make a killing trading.
  • Price-Volume Distribution Chart
    • It helps us identify reversals, divergences, or false breakouts.
    • It shows at a glance the prices that got the biggest volume with the highest number of trades.
    • It helps us see if the majority of the volume is registered near the intraday high, intraday low, or median. The price bar at the top
    • of the chart represents the intraday high. The price bar at the bottom represents the intraday low.
    • It gives us a clue if cross trades happened at a certain price.
    • This chart helps us decide where we should place our buying or selling price because we can see the prices that got the biggest volume with the highest number of trades at a glance.
    • It helps us know the stock‚Äôs Volume Weighted Average Price (VWAP).
  • Top 10 Players Chart
    • It helps us see if the top 10 brokers of the stock are buying the dips, selling the rips, or moving sideways.
    • It ranks all of the brokers who have traded the stock as of the time of checking/
    • It tells us the buying and selling average of each of the top 10 players of the stock on a real-time basis.
    • It tells us the psychological average price of the top 10 players of the stock.
    • It tells us the buying average and selling average of each of the top 10 players.
    • It tells us the cumulative buying average and cumulative selling average of the top 10 players.

PLC managed to maintain its position above the 0.74 support with a bullish volume. It temporary broke above the resistance at 0.84 as it hit the 0.85 intraday high at 10:33 am but it wasn’t sustained.

This 0.84 was once a strong support. Over the past 18 years, I’ve noticed that profit-taking is more likely to occur when the price is inching closer to a resistance level which was once a very strong support.

“So, Jaycee, do you mean you sell on that kind of a resistance level?”

I do not. I use a trailing stop loss. I don’t want stress when I do short-term trading and long-term investing. If it’s a gain, it’s a gain. I’m not the kind of a trader who wants to rake in every profit to the very last centavo. A trailing stop loss preserves my capital, protects my gain (if any), and prevents unbearable losses.

Recommended Article: Bakit Kailangang Gumamit ng Trailing Stop-Loss at Paano ang Computation Nito?

If PLC crosses above 0.85 with a strong volume tomorrow, chances are it will re-test the resistance at 0.94. 

If you’re like me who relies on a trailing stop loss, just do an upward adjustment on your trailing stop loss and you should be fine. That doesn’t mean you shouldn’t monitor the by-the-second movement of PLC, however. Did you already forget that none of the brokers in the Philippines have a stop loss feature in place?

Price-Volume Distribution

VWAP: 0.8197
Top 5 Prices (Biggest Trades): 0.83, 0.82, 0.84, 0.79, 0.8
Top 5 Prices (Biggest Volume): 0.82, 0.83, 0.84, 0.79, 0.85

PLC closed today at 0.82. Its Volume Weighted Average Price is very close to 0.82. This confirms that today’s market sentiment for PLC was bullish. That supports my bullish sentiment that PLC might continue to soar tomorrow. But, of course, I won’t rely to my data-driven bullish sentiment as the absolute truth. I will still respect my trailing stop loss even if the market proves my bullish sentiment wrong tomorrow. I hope you do the same. Prayer and hope are good in life. But don’t rely only on those two in stock trading or investing.

Top 10 Players EOD

Trading participants of PLC with a 100% Buying and Selling Activity as of Dec-10-2018 at 03:30PM:
13 out of 53 participants or 24.53% of all participants registered a 100% BUYING activity
15 out of 53 participants or 28.30% of all participants registered a 100% SELLING activity
Top 10 Players’ Buying Average: 0.8166
Top 10 Players’ Selling Average: 0.8215
The psychological average price of the top 10 players as of Dec-10-2018 at 03:30PM is from 0.8166 to 0.8215.

Know that Abacus is PLC’s top player this month as of 10 December 2018. It remains the top seller of PLC for December MTD. Are you nervous that most brokers will follow through on Abacus’ bearish moves tomorrow or in the coming days? You shouldn’t if you’re using a trailing stop loss and if you have the time to monitor the market.

Nonetheless, the mean of today’s intraday high and low is 0.795. The top 10 players’ buying average is higher than 0.795. I will still maintain my forecast that PLC might continue to touch 0.85 or higher tomorrow.  After all, today’s volume is higher than the volume’s 30-day moving average. When the price closed in green and its latest volume is above the 30-day volume average, I give an extra point to the bulls.

Recommendation

Planning to enter a new position on PLC? Don’t hurry. The chances of a rally at 0.84 are high. Why don’t you monitor first and wait for clarity on the PLC’s go or no-go decision to trade above 0.85 with conviction?

Do you already have PLC and you’d like to ask me if you should hold your position or buy some more? Ask yourself, “Do Jaycee’s overall sentiment resonate with mine?” Now, before you ask that question to yourself, please, pretty please, make sure you did a data-driven analysis to arrive on your personal sentiment on PLC. If my bullish sentiment resonates with yours, then, you have the option to add more shares. If you will, do it in tranches. Never go all-in any time and all the time. You got it?

Bottom line is, follow your trailing stop loss. You don’t need to add more stress in your life.

If you like how I think, if you like how I mix and match data, if you like how I connect seemingly irrelevant data but still be able to make a complete sense out of it, and if you like me to guide you in your short-term trading and long-term investing activities, subscribe to EquiPicks today.

Do You Have Questions?

Comment below. I’ll reply if you ask nicely.

Jaycee De Guzman

Jaycee De Guzman

I am the founder and CEO of iPresence Digital Marketing, Inc. and Equilyst Analytics, Inc. At iPresence, we have been helping SMEs reach and dominate the global market through our digital marketing services since 2001. At Equilyst, we have been helping Filipinos experience a simplified and profitable stock trading and investing experience in the Philippine Stock Market since 2014.
Jaycee De Guzman

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