CHAP AYAM "THE STOCKAHOLIC" RESEARCH (KLSE): December 2006

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ASIAEP

KLCI ends almost flat +0.38 points, to 1076.68 in moderate volume as gains in property related stocks, plantations and handful of blue chips offset profit-taking in broader market. Profit-taking Friday ahead of long weekend and year-end holidays expected to drag market lower tomorrow, possibly to around 1070. The market's rebound from Tuesday's knock-on effect following the Baht debacle provided an ideal opportunity for short-term investors to lock in profits. However, mild bargain hunting in blue chips and the relaxation of ruling for foreign ownership of properties helped offset some losses.

ASIAEP
Technically, ok lar Not Bad. Best buy 0.22 and below. Immediate targer 0.24. Cut loss 0.20.

For 21 DEC the closing price was 0.2250.
Overall, the bias in prices is: Upwards.
The projected upper bound is: 0.26.
The projected lower bound is: 0.19.

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After Thai, Will It Be Malaysia?

Bank of Thailand had instructed all banks to hold in reserve for one year 30% of the capital inflows. Those who withdraw the reserved amount in less than a year will be fined 33% of the 30% portion. The move somewhat similar to Malaysia when the capital control was imposed in September 1998.

Is history repeating? In today’s scenario, it is not about devaluing the currency, but more of a change in currency policy management. We found the equity market taking a beating, down by 1.9%, while Ringgit vis-à-vis US Dollar fell by 0.59% between 18th December 2006 & 19th December 2006. It should not surprise or upset investors’, despite the local authorities vehemently assuring that the present exchange rate policy management will remain intact. The reason being, in the past we are known for policy inconsistency or ‘flip-flop’ policy. Investors’ fear if the situation in Thailand turns ugly, Malaysia might impose a similar draconian measure to protect its currency and equity market.

If the authorities adhere to their commitment of a more flexible exchange rate policy that is now in place, we can expect investors’ optimism to rekindle. This would benefit both the economy and capital market, taking advantage from potential switching of portfolio from Thailand to other bourses in the region. Under such circumstances, assessment towards the economy and capital market for 2007 is still optimistic .

FULL RESEARCH: INTER-PACIFIC SECURITIES

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Bloody Tuesday

KLCI down 2.1% at 1058.92, off its intraday low of 1049.88; A rebound can only be a dead-cat bounce and investors should sell into strength. Does not expect KLCI to convincingly breach 1060 (30-day moving average). It will take at least a couple of weeks before market sentiment improves and retail investor confidence is rebuilt after today's plunge in share prices. Notes also, short-term investors generally turn net sellers ahead of holiday seasons and with Christmas just around the corner, they are likely to capitalize on any opportunity to sell. KLCI immediate support 1,040.

Biggest Drop in 7 Months

Malaysian Stocks Fall as Thai Fund Restrictions Prompt Sell-Off

Emerging-Market Stocks Slump on Thailand's Investment Controls

Malaysia says no capital controls after Thai move

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STILL NOTHING - zzzzzzzz

KLCI down 0.8% at 1080.21 in moderate trade, may drift down to 1070 if selling persists. Below this, KLCI may find support at 1058.50 (30-day moving average). Selling pressure is beginning to build up and some of the largest stocks (in terms of market cap) are retreating on profit-taking, but notes contraction in volume traded in recent days suggests decline may short-lived.

As for myself, slept in front of my `jackpot' machine most of the day. Unwilling to take any position. However my itchy finger may try to press F1 for KLCITY tomorrow... gosh! forever stockaholic.

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STILL WAIT & SEE - KLCI, SPOTMNT, UTUSAN, FAVCO, MUHIBBAH

Trading action for next week will continue to favour the large cap telecommunication stocks as well as the government-linked construction companies as these stocks are still showing a resilient trend despite the overall weak market. Nonetheless, investors should be wary of the sudden reversal in these stocks, as any profit taking activities on these stocks will be steep considering its strong run-up in the past two trading weeks. Selling pressure on the financial stocks is expected to taper off next week but investors should continue to adopt a 10%-15% strategy to avoid any sudden correction.

AS for me, duh still no important leads, wait & see again.

KLCI
Hopes to see a meaningful rebound testing the 1095 resistance. The immediate support level is 1,070.

For 15 DEC the index closed at 1,089.31.
Overall, the bias: Upwards.
Short term: moving.
Intermediate term: trending.
The projected upper bound is: 1,110.96.
The projected lower bound is: 1,072.55.

SPOTMONTH DEC
Hopes to see a potential rebound toward 1105. Support level is 1060.

For 15 DEC the SPOTMNTH closed at 1,087.5000.
Overall, the bias is: Upwards.
Short term: stalling.
Intermediate term: trending.
The projected upper bound is: 1,112.07.
The projected lower bound is: 1,068.07.

UTUSAN
Technical readings as requested by some friends o mine.
For now, sideways toward bearish - testing support 1.45. If breach, the next support level is 1.30.

For 15 DEC the closing price was 1.5000.
Overall, the bias in prices is: Upwards.
The projected upper bound is: 1.81.
The projected lower bound is: 1.31.

FAVCO
As requested by a friend.
Favco, looking good technically. Its ability to hold above the 0.75 support level, make it strong enough to test the 0.85 resistance level once again. And if it can breach this resistance level, the next target would be 1.00.

For 15 DEC the closing price was 0.8250.
Overall, the bias in prices is: Upwards.
The projected upper bound is: 0.89.
The projected lower bound is: 0.76.

MUHIBAH
Also as requested by a friend.
As for Muhibah, it is important if it can hold above the 2.50-2.55 support zone to gain momentum to test the 2.70 resistance level.

For 15 DEC the closing price was 2.6200.
Overall, the bias in prices is: Upwards.
The projected upper bound is: 2.79.
The projected lower bound is: 2.47.

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Still No Leads. More Wait & See

KLCI down 0.9% at 1078.83 on heavy selling; may drift within 1070-1080 range for rest of day on lack of news. The selling today is driven mainly by foreign funds, with some local funds absorbing some of the selling; the local market is also not reacting to positive newsflow because it's over-priced technically. The profit-taking is considered healthy as it corrects the overbought position that was apparent since mid-August this year.

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Ho Ho No Leads For Now - Wait & See for a While

KLCI ends +0.3% at 1101.70 in heavy volume but may narrow gains tomorrow on continued profit-taking. KLCI expected to stay in 1095-1115 range. Today's rise was largely due to Genting's 9.4% surge to MYR32 (after unit Genting International won bid for Sentosa casino resort in Singapore). Notes negative spread in broader market where decliners outnumbered gainers almost 2:1. Although the uptrend is still intact, a more meaningful correction is required before the next bullish breakout punches through the next significant resistance at 1138 (June'97 peak). Foreign funds still active, lifting Tenaga +0.9% to MYR11.60.

Technical Readings:

KLCI
For 11DEC the KLCI closed at 1,101.7000.
Overall, the bias in prices is: Upwards.
The projected upper bound is: 1,121.02.
The projected lower bound is: 1,087.80.

SPOTMONTH (DEC)
For 11 DEC the SPOTMNT closed at 1,103.5000.
Overall, the bias in prices is: Upwards.
The projected upper bound is: 1,124.56.
The projected lower bound is: 1,088.04.

MFCB, BERNAS, GHOPE, E&O etc.

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(Click on image to enlarge)

KLCI, SPOTMNTH, SAPCRES, GLOSOFT

The current bullish really troublin me, becoz no correction at all. Last night, I've a chance talking to my `Sifu' who is an Elliot Wave expert. He said that the current bullish trend could last until February 22, 2007 (ghee! the next important date)... heh.. heh dunno lahhh

KLCI
Still testing the 1,080 resistance. If able to breakout, the next target would be 1,095. However the market currently is in an extreme overbought condition.

For 1 DEC the KLCI closed at 1,080.1100.
Overall, the bias in prices is: Upwards.
The projected upper bound is: 1,098.55.
The projected lower bound is: 1,066.36.
The projected closing price is: 1,082.46.

SPOTMONTH (DEC)
Possible target for this month is 1,105.

For 1 DEC the closing price was 1,077.0000.
Overall, the bias in prices is: Upwards.
The projected upper bound is: 1,096.55.
The projected lower bound is: 1,062.27.
The projected closing price is: 1,079.41.

SAPCRES
Breakout resistance 0.72. Next Target 0.755/0.80. Below 0.74 can be considered a good buy. Cut Loss 0.70.

For 12/1/2006 the closing price was 0.7400.
Overall, the bias in prices is: Sideways.
The projected upper bound is: 0.78.
The projected lower bound is: 0.70.

GLOSOFT
On the rebound toward 0.16/0.185. Strong supporting volume. Cut Loss 0.145

For 1 DEC the closing price was 0.1550.
Overall, the bias in prices is: Upwards.
The projected upper bound is: 0.17.
The projected lower bound is: 0.14.

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Margin / Shares Financing (Pembiayaan Margin)

Somebody sent an email asking about Margin/Shares Financing. Here's some info on the related topic...

Many advertisements offering margin financing to buy shares, some stockbrokers also offered financing, frequently up to the value of your collateral. For example, if you place a deposit of RM100, 000, you would be able to purchase shares worth up to RM 200,000 on margin financing.

This means you would be buying shares using
borrowed money, which is also known as margin financing.

Brokers will also allow you to use shares you already own as collateral to finance the purchase of more shares. However, some conditions apply, such as, most institutions require that the shares you place as collateral be first board and selected second board shares. Warrants and especially short-dated warrants with less than one year left before expiry and some technology shares are not acceptable as collateral by most brokers.

Now, before venturing into margin financing, please consider carefully: