SM Investments Technical Analysis: Buy the Dips Like What Foreign Investors Do?

SM Investments Corporation Technical Analysis

SM Investments Corporation (SM) closed at 1,015 per share, down by 1.46 percent, as of September 10, 2019. The total turnover value reached P683 million with the foreign investors being the major participants in today’s trading of SM.

Foreign investors registered a Net Foreign Buying worth P501.3 million despite the descent in price. This shows that these deep-pocketed investors relatively loved today’s dips. Nonetheless, the foreign investors remain net sellers year-to-date.

SM Investments Corporation (SM) - Daily Chart Analysis EOD 1 - 9.10.2019

My three simple moving averages (10, 50, 200) are in a perfect bullish alignment. The shorter-term SMAs are all above the longer-term ones. Technically speaking, SM is bullish bought in the short-term and long-term periods. Of course, what I have just said is relative to your trailing stop loss.

Today, SM broke below the previous support at 1016. The previous support is now acting as the immediate resistance of SM. The immediate support is at 970.

The RSI of SM is still in the neutral territory, but it’s already downward-sloping. This means a technical correction is not far from sight.

The risk level of SM remains low due to its historical volatility of 35 percent.

Although the positive DMI is hovering the negative DMI, it doesn’t look as a bullish formation for me.

Trade-Volume Distribution

Last Price: 1,015.00
VWAP: 1016.342821
Most Traded: 1015 – 1017
Most Voluminous: 1015 – 1015

SM Investments Corporation (SM) - Trade Volume Distribution Analysis EOD 1 - 9.10.2019

The dominant range today is between 1014 and 1017. It’s closer to the intraday low than the intraday high. All in all, this makes a bearish Momentum Power Indicator for me. In layman’s terms, the descent in price is more likely to continue.

True Market Sentiment

True Market Sentiment of SM as of Sep-10-2019 at 03:30PM, with a last price of 1015.00.
3 of the top 10 brokers registered a positive Net Amount
5 of the top 10 brokers registered a higher Buying Average than Selling Average
True Market Sentiment: BEARISH
Top 10 Players’ Buying Average: 1015.9398
Top 10 Players’ Selling Average: 1015.8575
Bonus Info:
11 out of 32 participants or 34.38% of all participants registered a 100% BUYING activity
2 out of 32 participants or 6.25% of all participants registered a 100% SELLING activity

SM Investments Corporation (SM) - True Market Sentiment Analysis EOD 1 - 9.10.2019

This bearish mood of the top 10 brokers shows that they did not see anything so significant for them to continue buying SM toward its intraday high.

This bearish true market sentiment gives me a more bearish conviction that the descent in price is more likely to continue.

But sentiments change when the trade-volume distribution and true market sentiment change.

So, it’s better for you (if you’re a subscriber of Equilyst Analytics) to post a request of SM’s latest Trade-Volume Distribution and True Market Sentiment charts in our Private Clients Forum if you have this stock whether for short-term trading or long-term investing.

Remember that the lessons I taught you in the Evergreen Strategy in Trading and Investing in the Philippine Stock Market seminar is applicable both in short-term trading and long-term investing. That explains why there’s the word “evergreen” in the title of my seminar. The methods apply in all seasons, so to speak.


Do you have SM?

If you have SM because it’s still trading above your trailing stop loss, I suggest that you hold your position for now.

However, if it registers another red volume bar that’s higher than its 10-day volume average, I recommend that you adjust the percentage of risk you’ve applied in calculating your reward-to-risk ratio. I taught you that scenario during the Evergreen Strategy in Trading and Investing in the Philippine Stock Market seminar.

If SM will register a bullish Momentum Power Indicator tomorrow, you will then have a data-driven reason to top up within the dominant range (not at any random price).

Please don’t forget to do an upward adjustment on your trailing stop loss. I taught in the seminar when you should do that.

Do you plan to enter a new position on SM?

I suggest that you postpone that plan until the Momentum Power Indicator is bullish.

When does my Momentum Power Indicator become bullish?

I can discuss that to you in lesson # 3 of the Evergreen Strategy in Trading and Investing in the Philippine Stock Market seminar.

I suggest that you attend the seminar. This article will become an e-book if I will explain that to you here.

The Evergreen Strategy in Trading and Investing in the Philippine Stock Market Seminar

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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