CapitaMall REIT Making A Double Bottom

In the last chart on the 27th of Nov, I mentioned that CapitaMall was downtrending. Also to quote the entire paragraph for refresher sake, I posted that "the past three days have seen price seemingly stabilizing at $1.86 support, in hopes of rebounding upwards. A break below this may see price retreating to the next support at $1.81. To break out of the downtrend, price must head above $1.93. Only then can we expect price to head higher." See CapitaMall REIT in Trouble for further discussion.

On the 30th of Nov, prices dipped to $1.82 but broke out of its downtrend on the 2nd of Dec, closing at $1.96. After stabilizing for the next 2 weeks at $1.94 thereabouts, prices dipped back down to $1.85 on lower volume than the last dip to $1.82 suggesting that prices had reached a bottom. 

Today's charts indicate that a double bottom may have indeed been formed and prices are set to head upwards. Furthermore, indicators are all favourable. MACD and Stochastics have given a buy signal. RSI and OBV looks to be heading higher while MFI seems to have bottomed as well. This increases the odds of prices rising. Support seems to be at the 14 day moving average at $1.90. Resistance remains at $1.97. The crossing of the 14dma with the 200dma should send prices higher but is not in sight at the moment. 

Again with a yield of only 4.85% and price to book ratio of 1.28, I'm not interested in the stock however, traders interested in capital gains may want to consider this. 

Not vested.

~K

CapitaMall started at Overweight by HSBC, target $2.22
Friday, 10 December 2010

© 2010 - The Edge Singapore

CapitaMall REIT in Trouble

All things entail rising and falling timing. You must be able to discern this. ~ Miyamoto Musashi

Since 13th of Oct, CapitaMall has been downtrending. From the chart below, this doesn't look like it's going to change soon. OBV and MFI indicate strong distribution with lower highs being formed. Furthermore the 14day moving average seems to be heading straight for a collision path with the 200day m.a., probably forming a dead cross with it. To add to this, ADX is still rising indicating that the strength of the current trend is extremely strong with black candles marking the way down since the 9th of Nov and isn't giving any indication of letting up despite Stochastics and RSI being in oversold region. RSI has also formed lower highs which bodes negatively for CapitaMall as well.

On the bright side, the past three days have seen price seemingly stabilizing at $1.86 support, in hopes of rebounding upwards. A break below this may see price retreating to the next support at $1.81. To break out of the downtrend, price must head above $1.93. Only then can we expect price to head higher.

Personally, for long term investing and as an income stock, at current price to book ratio of 1.25 and yield of 5%, CapitaMall is unattractive as a buy.

Not vested. 

~K

Heightened risks for Singapore REITs - CIMB    
Thursday, 18 November 2010

© 2010 - The Edge Singapore