BDI

CIMB has summed up that the drastic drop in BDI was mainly due to:
1. slow down in China
2. over-supply vessel.
3. reduction of 2nd hand vessel price

Evergreen

Those who bought at 0.95 level should sell for 10% gain now.

TA Observation:
1. Buying climax found at last trading hour on 25/1
2. Divergence - price flat while RSI trending lower.
3. MA 10 is crossing down MA20.

KNM

For those who bought at 1.00 level is time to take some profit. Current price at 1.13. you should rake in handsome 13% gain (exclude transaction cost).

TA Observation
1. Buying climax found at the last trading hour, 5pm 27/1.
2. Strong retracement occurred within the same last trading hour - observe the last upper shadow of the candle.
3. Divergence - stock moving higher but RSI trending down with declining volume
4. Next support level will be at 1.07 & 1.04.

BDI

The BDI fell off the cliff since the beginning of the year. As reported by OSK Reseach, it was due to
1. Slow down of demand from China
2. Over supply of vessels
3. Stronger USD.








In the contrary, Maybulk has been surging since the beginning of the year. The rally in Maybulk does not mirror the performance of BDI. Hot speculation is the Maybulk may be embarking into corporate exercise including privatisation.

YTLE

YTLE - the next generation of broadband service provider carried the brand YES. Typically, broadband business is operating in a Oligopoly market. The incumbents are the big 3 TM, Digi, Maxis, + stand alone providers are, P1, YES, U mobile. Advantages of Oligopoly business include ability to conspire the offering price of their services. Generally EBITA margin is above 50%, hence a lucrative business. Nonetheless, this business require high capex to reach its critical mass in order to enjoy economic of scale and huge advertisement spending and huge client acquisition cost include subsidising the phone purchase by customer.

YTLE has completed the four stages of market cycle. YTLE gone through the mark-up phase in Sep 2011 before the launched of its broadband services YES. it shoot up to 1.80 by mid Nov 2010 with extremely high volume. Subsequently, the stock has been marked-down all the way down to 70 sen within a year.

Mark-down Phase
Volume decline gradually during this phase. Observe the read box - there was sudden surge in volume and drastic drop in price signify selling climax. After the selling climax, it was quiet for another two months with price mark-down further from 75 sen to 70 sen. Strong accumulation seen in the green box with high surge of price and volume. it is also the first time the stock broke above MA50 and trade above MA100.

Insider Move

YTL Group controls 75% of the YTLE, the maximum holding by a single shareholder under the current Bursa rule. Insider was neutral for the last 10 months. The stock price movement will be dynamic and volatile as the free float in the market is minimal.


Financial Results
PAT has been on uptrend from 1 mil to 9 mil for the last 8 quarters.
PAT June 2010 = 16 mil
PAT June 2011 = 35 mil
PAT June 2012 (estimate)=9x4=36 mil.
Current market cap = 1,168 mil
2011 PE = 1168/35 = 33x
2012 PE = 1168/36 = 33x
Observe the PE is high by any standard. Extreme care is required to trade this stock. But the high growth and high EBITA margin is seen to reduce the high PE quickly after the critical mass is achieved.

TA Observation
1. Stock has bottom out.
2. Trading above above MA50
3. Current support level seen at MA100
4.Biggest Obstacle - Resistant at 92 sen.

Action
keep watching

Kimlun

Market seems to listen to me. Kimlun chalk-up 5.8% today after my posting yesterday. Well done.

Xinquan

Listed in July 2009. Classified as M-Chips by borrowing reference name from S-Chips (referring to China Companies listed in SGX). These small to mid size (by China definition) China Companies has difficulty to list in neither Shanghai Stock Exchange nor Hong Kong Stock Exchange. SGX has seized the opportunity to lure these China Companies to launch their IPO. These China Companies could easily qualify for mid to large cap stock in South East Asia's stock exchange. At peak, there were more than 200 China Companies listed in Singapore. However, after a few round of fun fare, good companies start to diminish. Second grade or rather low grade companies were also lure to list. These low grade stocks have eventually led to a few bad apples that shock the investment community in Singapore. The most infamous shocks include misappropriate of public funds and fictitious accounting practices. The revelation of this crisis made the investors and authorities become cautious on these companies. After a few year, the Malaysian investment banks and Bursa fill the gap by luring these companies to Malaysia. Eventually led to a few China Companies listed at Bursa. Those are Xinquan, Multi Sports, XDL and so on. However, the performance of these companies remain lackluster.

Financial Performance
PAT Jun 2010 = 105mil
PAT Jun 2011 = 118 mil (during the mark-down phase)
PAT Jun 2012 forecast = 35X4=140mil
Current Market Cap=256mil
2011 PE = 256/118 = 2.2
2012 PE = 256/140 = 1.8

Yes, 2012 forward PE of 1.8x. You only find this in M-Chips. For traders, this is excellent opportunity to trade until the perception of "rotten M-Chips" is unfolded. Otherwise, money will flow into this stock gradually. The Low PE signify the Fear factor is still high due to lots of horror story of M-Chips.

Insider move
No significant movement by major shareholder for the last one year








TA Observation
1. The stock has completed the four phases - Accumulation, Mark-up, Distribution, Mark-down.
2. Breakout of MA50 for the first time in the Mark-down phase
3. Selling climax in first two weeks of Dec 2011 with extremely high volume during the Mark-down phase.
4. Key now is price is required to hold above MA50.

Action
Keep watching. Retracement to to MA50 will be a good level to accumulate be the pioneer of the Accumulation phase.

Fed: low interest rate until 2014

Release Date: January 25, 2012

For immediate release

Information received since the Federal Open Market Committee met in December suggests that the economy has been expanding moderately, notwithstanding some slowing in global growth. While indicators point to some further improvement in overall labor market conditions, the unemployment rate remains elevated. Household spending has continued to advance, but growth in business fixed investment has slowed, and the housing sector remains depressed. Inflation has been subdued in recent months, and longer-term inflation expectations have remained stable.

Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee expects economic growth over coming quarters to be modest and consequently anticipates that the unemployment rate will decline only gradually toward levels that the Committee judges to be consistent with its dual mandate. Strains in global financial markets continue to pose significant downside risks to the economic outlook. The Committee also anticipates that over coming quarters, inflation will run at levels at or below those consistent with the Committee's dual mandate.

To support a stronger economic recovery and to help ensure that inflation, over time, is at levels consistent with the dual mandate, the Committee expects to maintain a highly accommodative stance for monetary policy. In particular, the Committee decided today to keep the target range for the federal funds rate at 0 to 1/4 percent and currently anticipates that economic conditions--including low rates of resource utilization and a subdued outlook for inflation over the medium run--are likely to warrant exceptionally low levels for the federal funds rate at least through late 2014.

The Committee also decided to continue its program to extend the average maturity of its holdings of securities as announced in September. The Committee is maintaining its existing policies of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction. The Committee will regularly review the size and composition of its securities holdings and is prepared to adjust those holdings as appropriate to promote a stronger economic recovery in a context of price stability.

Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; William C. Dudley, Vice Chairman; Elizabeth A. Duke; Dennis P. Lockhart; Sandra Pianalto; Sarah Bloom Raskin; Daniel K. Tarullo; John C. Williams; and Janet L. Yellen. Voting against the action was Jeffrey M. Lacker, who preferred to omit the description of the time period over which economic conditions are likely to warrant exceptionally low levels of the federal funds rate.

2012 Monetary Policy Releases

Comment
Fed is keep the interest rate at a quarter percent until at least 2014. This will only prolong the carry trade activities. Borrow USD at extremely low rate then invest the same money into other riskier assets such as stock at the countries. Any spike in interest rate will result in speculators to liquidate investment to cover the open position when the return gap is narrowing.

Market Cycle

Stock market cycle is a derivative of economic/business cycle. History has shown us that economic/business cycle typically go through a period of boom phase led by greed - ie the mark-up phase. Bubble burst at the top with a mere push. Typically follow by mark-down phase lead by the fear.





An example of application of market cycle.











Another example of application of market cycle.

KNM

Well done. KNM shoot up with 11% gain today. it should be profit taking tomorrow. If you miss this shot, dont worry wait for the cycle.

Kimlun

The Mark - up Phase (July 2010 - Apr 2011 - 10 months)
Kimlun was listed in Mid 2010 around 90 sen to 1.00. Principally engaged in pre-fabrication construction system. The advantages of the system are cost and time saving in construction activities. Its construction process cuts down construction time at the site. It also require less construction workers as the "wall" is pre-fabricated at factory. It has a large order book at the time of listing, hence it solid fundamental has pushed the stock to its high within a year to 2.00, achieved more than 100% gain. Marvelous!

The Distribution Phase
This is the most interesting phase. it has multiple double tops
1. Oct & Nov 2010
2. Jan & Feb 2011
3. Apr & May 2011.
The demand was so strong that it remained on uptrend channel.

The Mark-down phase (Jul 2011 - Sep 2011)
The strong support at 1.70 level was broken in July 2011. It was mark-up down furiously by 40% within 3 months from 1.70 level.

Accumulation Phase (Sep 2011)
A mini accumulation phase occurred in Aug 2011. The serious accumulation commence in the end of Sep 2011.

The Mark - up Phase (Oct 2011)

The Distribution Phase (Nov 2011)
A double top appeared

The Mark-down phase (Dec 2011)

The Accumulation phase - begin in Jan 2012??

The Insider Move
The major shareholders moved into this stock in Sep 2011 - signified the bottom of this stock. Coincidentally it is during the Accumulation phase above. We have yet to see the insider move into the stock into this work in Jan 2012.





The results
Fundamentally Kimlun remained profitable throughout the Mark-up Phase - signify the sound fundamental of the stock




TA Observation
1. Divergence in Dec 2011 - price move lower low from mid Dec to end Dec 2011 while RSI move higher low in the same period.
2. Exceptionally higher volume in end Dec 2011 with price move lower - signify SELLING CLIMAX.
3. Price move higher day after day after the selling climax.
4. MA10 crossing MA20 soon

Action
BUY

Evergreen

Another diving stock.
from 1.70 (4/2010) to 90 sen (9/2011). A long 18 months bear.



















LTH has since accumulating the stock since Mar 2011 to Aug 2011. However, the stock remain bearish. Nonetheles, the stock bottom on 26/9/2011 with a hammer formed.











Fundamental Observation:

	Rev	PAT
Q409	224,143	41,577
Q110	238,689	33,081
Q210	241,465	36,493
Q310	228,894	19,520
Q410	242,138	17,745
Q111	233,557	5,751
Q211	252,279	12,532
Q311	279,675	24,071

1. Revenue flattening while PAT diving from Q409 to Q111
2. Revenue and PAT bottom up after Q111.

TA Observation:
1. first double bottom occurred in May and June 2011. However it was short life. (DB1)
2. second double bottom formed in Sep and Nov 2011. (DB2)
3. DB2 is more significant than DB1 - Stock crossed MA100 pushing towards MA200
4. MA50 should be crossing MA100 soon.
5. Support should be found at MA 100 or MA50 - A good level to accumulate.
6. Stock is overbought now with buying climax on 20/1 & 25/1.

Action:
Wait for retracement to MA50/100 to accumulate.

Haio

Haio another diving stock
March 2010 - 4.50
Sep 2011 - 1.50
67% value evaporated within 18 months. the interesting question is why?

Financial Summary

Date	Stock	Quarter	Year End	Current Year Quarter				Current Year To Date
				Revenue (RM'000)	P/L (RM'000)	EPS (sen)	Dividend (sen)	Revenue (RM'000)	P/L (RM'000)
21 Dec 2011	HAIO	2nd	30 Apr 2012	56,199	7,868	3.94	2.00	107,172	15,601
28 Sep 2011	HAIO	1st	30 Apr 2012	50,973	7,734	3.87	-	50,973	7,734
23 Jun 2011	HAIO	4th	30 Apr 2011	58,156	8,547	4.28	5.50	223,150	28,829
23 Mar 2011	HAIO	3rd	30 Apr 2011	57,621	6,347	3.18	-	164,994	20,283
17 Dec 2010	HAIO	2nd	30 Apr 2011	52,622	6,132	3.07	2.00	107,374	13,935
29 Sep 2010	HAIO	1st	30 Apr 2011	54,751	7,804	3.91	-	54,751	7,804
25 Jun 2010	HAIO	4th	30 Apr 2010	98,838	14,257	7.14	14.50	511,064	70,916
19 Mar 2010	HAIO	3rd	30 Apr 2010	131,281	18,009	21.64	4.00	412,227	56,659

FYE 4/2011 revenue down 50% (511 mil to 223mil) PAT down 59% (71 mil to 29 mil) - value destruction.
Cumulative 2 lastest quarters, revenue - 107mil PAT 15mil.
Annualised FYE 4/2012, revenue - 214mil PAT 30 mil.
FYE2012 results will be slightly better than FYE2011.

Changes In Shareholder

Date	Stock	Name	Type	Qty
11 Aug 2011	HAIO	TAN SIOW ENG	Acquired	21,900
11 Aug 2011	HAIO	PHAN VAN DENH	Acquired	21,900
11 Aug 2011	HAIO	TAN KENG KANG	Acquired	21,900
11 Aug 2011	HAIO	TAN KENG SONG	Acquired	21,900
11 Aug 2011	HAIO	TAN KAI HEE	Acquired	21,900
4 Jul 2011	HAIO	TAN SIOW ENG	Acquired	33,500
4 Jul 2011	HAIO	TAN KENG KANG	Acquired	33,500
4 Jul 2011	HAIO	PHAN VAN DENH	Acquired	33,500
4 Jul 2011	HAIO	TAN KAI HEE	Acquired	33,500
4 Jul 2011	HAIO	TAN KENG SONG	Acquired	33,500
31 Jan 2011	HAIO	AKINTAN SDN BHD	Acquired	40,100
31 Jan 2011	HAIO	TAN SIOW ENG	Acquired	40,100
31 Jan 2011	HAIO	PHAN VAN DENH	Acquired	40,100
31 Jan 2011	HAIO	TAN KENG KANG	Acquired	40,100
31 Jan 2011	HAIO	TAN KAI HEE	Acquired	40,100
31 Jan 2011	HAIO	TAN KENG SONG	Acquired	40,100
26 Jan 2011	HAIO	AKINTAN SDN BHD	Acquired	40,400
26 Jan 2011	HAIO	TAN KENG KANG	Acquired	40,400
26 Jan 2011	HAIO	TAN SIOW ENG	Acquired	40,400
26 Jan 2011	HAIO	PHAN VAN DENH	Acquired	40,400
26 Jan 2011	HAIO	TAN KAI HEE	Acquired	40,400
26 Jan 2011	HAIO	TAN KENG SONG	Acquired	40,400
30 Dec 2010	HAIO	AKINTAN SDN BHD	Acquired	41,000
30 Dec 2010	HAIO	PHAN VAN DENH	Acquired	41,000
30 Dec 2010	HAIO	TAN SIOW ENG	Acquired	41,000
30 Dec 2010	HAIO	TAN KENG KANG	Acquired	41,000
30 Dec 2010	HAIO	TAN KENG SONG	Acquired	41,000
30 Dec 2010	HAIO	TAN KAI HEE	Acquired	41,000
24 Dec 2010	HAIO	AKINTAN SDN BHD	Acquired	50,000
24 Dec 2010	HAIO	TAN KENG KANG	Acquired	50,000
24 Dec 2010	HAIO	PHAN VAN DENH	Acquired	50,000
24 Dec 2010	HAIO	TAN SIOW ENG	Acquired	50,000
24 Dec 2010	HAIO	TAN KAI HEE	Acquired	50,000
24 Dec 2010	HAIO	TAN KENG SONG	Acquired	50,000
5 Oct 2010	HAIO	Phan Van Denh	Acquired	118,000
5 Oct 2010	HAIO	Tan Keng Kang	Acquired	118,000
5 Oct 2010	HAIO	Tan Siow Eng	Acquired	118,000
5 Oct 2010	HAIO	Tan Keng Song	Acquired	118,000
5 Oct 2010	HAIO	Tan Kai Hee	Acquired	118,000
5 Oct 2010	HAIO	Akintan Sdn Bhd	Acquired	118,000
25 Aug 2010	HAIO	Quek Ah Ba	Disposed	40,704
9 Aug 2010	HAIO	Datin Sunita Mei-Lin Rajakumar	Disposed	33,500
28 Jul 2010	HAIO	Datin Sunita Mei-Lin Rajakumar	Disposed	33,500
19 Jul 2010	HAIO	Datin Sunita Mei-Lin Rajakumar	Transferred	100,636

Insider move
From the list above, insiders including Tan Kai Hee has been net buyer for the last one year.

Shares Buy Back

Date	Stock	Shares Acquired (Cancelled)
6 Jan 2012	HAIO	2,000
5 Jan 2012	HAIO	3,000
4 Jan 2012	HAIO	2,400
3 Jan 2012	HAIO	3,400
30 Dec 2011	HAIO	2,800
29 Dec 2011	HAIO	2,700
28 Dec 2011	HAIO	3,600
22 Dec 2011	HAIO	1,000
21 Dec 2011	HAIO	2,600
20 Dec 2011	HAIO	4,800
19 Dec 2011	HAIO	7,300
16 Dec 2011	HAIO	2,400
15 Dec 2011	HAIO	3,600
14 Dec 2011	HAIO	4,400
13 Dec 2011	HAIO	2,400
9 Dec 2011	HAIO	3,400
8 Dec 2011	HAIO	2,100
7 Dec 2011	HAIO	4,600
6 Dec 2011	HAIO	4,000
5 Dec 2011	HAIO	4,000
2 Dec 2011	HAIO	10,200
2 Dec 2011	HAIO	7,000
1 Dec 2011	HAIO	7,000
30 Nov 2011	HAIO	1,300
29 Nov 2011	HAIO	4,000
25 Nov 2011	HAIO	8,500
24 Nov 2011	HAIO	2,500
23 Nov 2011	HAIO	4,900
22 Nov 2011	HAIO	11,100
21 Nov 2011	HAIO	5,200
18 Nov 2011	HAIO	2,600
17 Nov 2011	HAIO	2,200
25 Oct 2011	HAIO	2,500
24 Oct 2011	HAIO	2,200
7 Oct 2011	HAIO	1,400
6 Oct 2011	HAIO	2,600
5 Oct 2011	HAIO	2,100
4 Oct 2011	HAIO	3,400
3 Oct 2011	HAIO	10,000
30 Sep 2011	HAIO	3,000
29 Sep 2011	HAIO	5,000
22 Sep 2011	HAIO	12,400
21 Sep 2011	HAIO	4,800
20 Sep 2011	HAIO	8,600
19 Sep 2011	HAIO	3,200
15 Sep 2011	HAIO	3,400
14 Sep 2011	HAIO	21,900
13 Sep 2011	HAIO	5,000
12 Sep 2011	HAIO	8,700
9 Sep 2011	HAIO	2,700

The Company has implemented share buy back scheme although effect may be negligible.

Fundamental Observation:

1. Profitability is improving

2. Consumerism sector remain a core pillar in country wealth creation – a main contributor to GDP in recent quarters.

3. Insider moving back to the stock

4. Share buy back.

TA Observation:

1. The stock bottom in Oct 2011

2. Making a 20% gain by end of Oct 2011

3. Flattening for next 2 – 3 months til Dec 2011.

4. Price and volume move again in Jan 2012 – the engine is ignited and the long night happening party began.

5. NOW: The stock is overbought now and facing a resistance at 2.40 level – profit taking began

6. A Dark Cloud Cover emerged on 19/1/2012 – signify the beginning of distribution.

Action:

Wait for retracement to MA50/100 to accumulate.