BLOOM Technical Analysis: Buy on Breakout or Wait for a Pullback?

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BLOOM Technical Analysis

Bloomberry Resorts Corporation (BLOOM) closed at P10.70 per share, up by 3.88 percent, as of the closing bell on September 5, 2019. The total turnover value reached P30,133,572.00.

Bloomberry Resorts Corporation (BLOOM) - Daily Chart EOD 1 - 9.5.2019

Foreign investors registered a Net Foreign Buying worth P2,587,960.00. They remain net buyers year-to-date despite the Net Foreign Selling worth P96 million for the entire month of February 2019.

The immediate support of BLOOM is near 9.32 while the immediate resistance is near 11.14.

BLOOM is still stuck in the downtrend channel as its still moving below the 200-day simple moving average.

But here at Equilyst Analytics, our basis on whether we should trade the stock is not only based on the position of the last price relative to whichever moving average.

Those who subscribe to Equilyst Analytics and those who already attended the Evergreen Strategy in Trading and Investing in the Philippine Stock Market seminar know that there are 6 strategies that an independent and profitable trader must have.

Here are my 6 proprietary methods, which I teach in my Evergreen Strategy in Trading and Investing in the Philippine Stock Market seminar.

Lesson 1: how to identify the best stocks to trade
Lesson 2: how to check if the current trend is more likely to continue
Lesson 3: how to know the true market sentiment
Lesson 4: how to identify a confirmed buy signal
Lesson 5: how to identify the best price range to trade
Lesson 6: how to sell more logically and less emotionally

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Despite the insufficiency of daily volume, my 10SMACD combo for BLOOM remains valid. Its validity was confirmed today, when the MACD crossed above the signal line.

You know what this means if you attended my advanced technical analysis seminar (Evergreen Strategy in Trading and Investing in the Philippine Stock Market).

The risk level of BLOOM remains low due to its historical volatility score of 45 percent. Even if this low risk level makes BLOOM a newbie-friendly stock, this score is not enough as a reason to trade any stock.

The +DMI is still moving below the -DMI, but I am already seeing a bullish formation between the two lines. The +DMI will have bigger chances of crossing above the -DMI once BLOOM breaks above the resistance at 11.14.

Trade-Volume Distribution

Last Price: 10.70
VWAP: 10.61639374
Most Traded: 10.42 – 10.7
Most Voluminous: 10.7 – 10.64

The dominant range is between 10.60 and 10.70, which is closer to the intraday high than the intraday low. All in all, this makes my Momentum Power Indicator bullish for BLOOM.

Bloomberry Resorts Corporation (BLOOM) - Trade Volume Distribution EOD 1 - 9.5.2019

True Market Sentiment

True Market Sentiment of BLOOM as of Sep-05-2019 at 03:30PM, with a last price of 10.700.
3 of the top 10 brokers registered a positive Net Amount
4 of the top 10 brokers registered a higher Buying Average than Selling Average
True Market Sentiment: BEARISH
Top 10 Players’ Buying Average: 10.6007
Top 10 Players’ Selling Average: 10.6208
Bonus Info:
8 out of 41 participants or 19.51% of all participants registered a 100% BUYING activity
20 out of 41 participants or 48.78% of all participants registered a 100% SELLING activity

Bloomberry Resorts Corporation (BLOOM) - True Market Sentiment EOD 1 - 9.5.2019

This bearish true market sentiment shows the lack of a strong desire to break above 10.70 with a strong volume. For me, this means that those who are trading BLOOM like the stock but they are still in a risk-averse position.

Did you notice that 20 of the 41 participating brokers registered a 100 percent selling activity today?

Recommendations

If you already have BLOOM…

If you still have BLOOM because it’s still trading above your trailing stop loss, you have a data-driven reason to top up within the dominant range.

However, if the price starts tomorrow lower or higher than the dominant range I mentioned above, I strongly suggest that you post a request for BLOOM’s latest Trade-Volume Distribution and True Market Sentiment charts in our Private Clients Forum (for subscribers only).

This is important because today’s dominant range may no longer be the dominant range within the first 30 minutes of trading tomorrow.

If you don’t have BLOOM yet…

Since the 10SMACD combo is valid and the Momentum Power Indicator is bullish, I suggest that you calculate your reward-to-risk ratio first. If you are satisfied with your reward-to-risk ratio, then, that’s the rightful time for you to do a test-buy within the dominant range.

Also, keep in mind the advice I gave when BLOOM starts tomorrow at a price lower or higher than today’s dominant range.

On the other hand, you’ll have a thicker potential risk than your potential reward if you’ll calculate your reward-to-risk ratio right now relative to the distance of the last price to the immediate resistance and support.

So, do a test-buy only if you have a high risk tolerance.

Regardless whether you already have BLOOM or not, make sure that you use a trailing stop loss relative to your percentage of risk tolerance.

Reduce your percentage of risk when signs of a weakening upward momentum are spotted. This is what I taught you in lesson # 6 of my advanced technical analysis seminar.

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About the Author
Jaycee De Guzman is an online business strategist, an equity analyst, an entrepreneur, and a computer scientist by profession. Visit his website at www.jayceedeguzman.com.

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