Here i would like to stress that retailers can also perform the stock analysis, as professional as those stock analysts. Do not be discouraged even though we are retailers. This should not stop our passion towards investing. Whatever the stock analysts can do, we can do it like them too, we can emulate their analysis method, thus reduce our investment risks. Now let me share my experience and analysis method on how retailers can perform analysis.
Commodity (Steel & Aluminium)We saw rallies in steel and aluminium stocks on 9 August 2017. Steel and aluminium are closely related as they are main contributors for construction sector. Dragonhead for steel, ANNJOO rised up more than 5%, and also prompting some other steel stocks such as PRESTAR (+4%), MYCRON (+6%), MASTEEL (+8%) and other steel counters.
|ANNJOO Daily Chart|
When we look at the fundamental global news, China is expecting to have lower supply, thus provokes the rise of steel prices and eventually triggers our steel counters to rise also.
|The Edge: Steel counters rally on expectations of lower supply by China|
|The Star: China shuts 42.4 million tonnes of steel capacity in H117|
Coming back to aluminium. The aluminium price is hovering around 1870 and 1962. And now, it had broken the 2,000 mark. From the technical chart view, this is a very beautiful breakout. In my benchmark, if it can stays above the support of 1960 for more than 5 days, we can consider it to be a strong support.
|Aluminium Price |
|PMETAL Daily Chart|
|ARANK Daily Chart|
A) Global Aluminium Price: Price heading north
B) Donald Trump - Make America Great Again, more facilities to be built, triggering the aluminium price.
C) China vs Pollution - China to curb the pollution seriously
D) Peer Comparison: If PMETAL continue to go up, ARANK will be following.
E) The QR of ARANK - Q1, Q2, Q3 is lower but will spike up in Q4, hope the trend continues. However, be mindful of LBALUM's Q4 result. Its Q4 net profit decreased by 76.4% mainly due to underprovision of deferred taxation. I am not sure whether this will happen to ARANK or not.
I set my goals at longer terms, so hence, i am not fluctuated by the buoyancy of the chart. Hopefully all these factors will continue to lead ARANK to go up. As retailers, we can try to relate the global news impact to the aluminium prices, and next how the news provokes the dragonhead and subsequently the other counters.
The 2 factors that i extracted from SLP and DAIBOCI QR are:
1. Higher raw material prices - plastic resin
2. Stronger MYR - unfavourable for export counters for SLP only
|Extract from SLP's QR|
|Extract from DAIBOCI's QR|
|SLP Daily Chart|
|DAIBOCI Daily Chart|
Let's look at the counters that already anticipated the drop in QR and profit taking had already happens. BPPLAS.
|BPPLAS Daily Chart|
|TOMYPAK Daily Chart|
|Half full, half empty water|
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|Gainvestor 《Fishers of Stock》Come to JOIN!!!|
: SLP Q217: http://disclosure.bursamalaysia.com/FileAccess/apbursaweb/download?id=196757&name=EA_FR_ATTACHMENTS
: DAIBOCI Q217: http://disclosure.bursamalaysia.com/FileAccess/apbursaweb/download?id=196779&name=EA_FR_ATTACHMENTS