China HongXing – Down Trend Coming to an End?

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China HongXing has been on free fall recently after announcing worst than expected quarterly. Although the company is still cash rich, the financial ratio has been pretty poor compared to their peers. ROA & ROE are only a pathetic 3% in FY2009 compared to previous years of more than 10%. Recent chart suggests that China HongXing may be ending a down trend by showing doji candlesticks for past two trading days. Furthermore, it looks like a falling wedge has been formed and the chart  is close to breakout soon. No clear patterns for the time being until the breakout or a reversal candlesticks pattern is observed.

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Wilmar – Looks Attractive

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Wilmar’s current price looks attractive currently after a huge gap down due to tax accounting issue.

The current level may not be a good entry level for trading because there is a risk of forming evening star candlesticks pattern and may send Wilmar to $5.10 (61.8% Fibonacci Retracement Level).

  • Immediate support $5.76 which is a gap support.
  • Immediate resisatnce at about $6.00 which is 78.6% Fibonacci Retracement Level.

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Z-Obee – Over Value

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The recent crash of Z-Obee price was not to my surprise because the it is predictable base on the following two observations:

  • Parabolic Curve
  • PE = 35 (base on current price of $0.36). If base on the high of $0.61, the PE is 57 which is extremely over value. At present PE of 35, the stock is still over value.

I hope this post can help people to avoid get burnt badly when chasing over value stocks especially the chart pattern is showing Parabolic Curve.

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