Philippine Equity Research

April 2, 2018
WEEK’S HIGLIGHTS
• The Philippines’ PSEi rallied 9-pts for the week after coming from
Bullseye Report oversold conditions
• Average Daily Value Turnover slid to P6.9-B for the week as against
Weekly Overview P10.7-B the week previous
Issue Prev Wk Last Wk Wk Chg Wk Chg % YTD % • Net foreign flows were negative again with outflows of Php2.5-B
coming from outflows of Php6.4-B the previous week
Philippines 7,971 7,980 9.03 0.11 (6.76)
Peso-$ 52.34 52.16 (0.180) (0.34) 4.47 • The PSEi (at 7,979) rebounded slightly for the week but remains
MSCI Phils 33.6 34.94 1.34 3.99 (9.99) below the support breach of 8,130-8,050. This prompts for the
PLDT US 27.64 28.37 0.730 2.64 (5.68) possible watch of next support between 7,800-7,700. Recent
DJIA 23,533 24,103 569.91 2.42 (2.49)
oversold readings allowed for some technical rebound but it’s
reactive trend remains. A reversal base is still needed to ground its
SP500 2,588 2,641 52.61 2.03 (1.22)
corrective trend and force on a wider rally swing (or B-wave). We
Nasdaq 6,993 7,063 70.77 1.01 2.32
await for appropriate basing signs so as to prepare for the
Germany 11,886 12,097 210.42 1.77 (6.35)
moderate but possibly tradable rebound
Nikkei 20,618 21,159 541.22 2.63 (7.05)
Hong Kong 30,309 30,093 (215.91) (0.71) 0.58
• The US market along with some European and Asian markets did
show some rally action as well but also keep their corrective trends
China 3,153 3,161 7.77 0.25 (4.43)
intact. The US did break below a key support and puts their market
US 30yr Bond 143.81 145.74 1.93 1.34 (4.08)
on the defensive. It was a welcome sight however to see US Bond
10-Yr Yield 2.83 2.741 (0.089) (3.14) 13.97
Yields slide so as to mitigate any abrupt up side threats in interest
Dollar Indx 89.03 89.81 0.78 0.88 (2.20)
rates. The Dollar Index climbed and moved to tests resistance –
Gold 1,349.90 1,327.30 (22.60) (1.67) 1.37
this in turn put some pressure into commodities. Asian markets,
Oil 35.88 64.94 29.06 80.99 7.48 like the Philippines, also show corrective trends
CRB Index 196.26 195.36 (0.90) (0.46) 0.77
Focus Items
Authored by:
Highlight Page
Juanis G. Barredo
Philippines : Weekly Stats 2
VP; Chief Technical Analyst
COL Financial Group Inc. Philippines : PSEi & Peso 3
(632) 636-5411 Tech Map: Some key stocks and trend calls 4
Juanis.barredo@colfinancial.com US and Europe: In review 5
Disclaimer: All opinions and estimates constitute the judgment of COL’s Equity Research Dept as of Asia: In review 6
the date of the report and are subject to change without notice. The report is for informational
purposes only and is not intended as an offer or solicitation for purchase or sale of a security. Currencies & Commodities: In review 7
 Bullseye --- Page 2

Philippines: Weekly Stats**

2018 Net Foreign Flows of –P32.63-B

*Source: PSE
PER (Price/Earnings Ratio) data uses four-quarter trailing financial data
 Bullseye --- Page 3

Philippines: PSEi & Peso-$

Recommendation: Sell on rallies
Support: 7,800-7,700 Resistance: 8,600 – 8,757
• The PSEi was up 9-pts (+0.11%) for the week but remains
below support and a down trendline
• Now that support between 8,050 has been broken, we
look towards the next support zone of 7,800-7,700
• Weekly MACD reads still show weak signs
• Although weekly RSI reviews do not show oversold
readings as of yet, price spreads to short term averages
may need to narrow a little allowing for some brief rallies
• A sell on these rallies is suggested until a better demand
setup for a reversal can be shown

Recommendation: Range trade the channel

Support: 51.50-50.80 Resistance: 52.25 – 52.50 /52.90
• The Peso-$ (at 52.16) was a little stronger for the week but
is still into a weakening trend
• A rising channel may be controlling its price swings and if so
could see resistance closer 52.25-52.50
• Although weekly MACD still sees weakness for the P-$ its
daily version maybe showing some momentum loss allowing
for some correction time (within its channel)
• Look to range trade its support and resistance of its
apparent channel
 Bullseye --- Page 4

Some Key Stocks and Trend Calls

Tech Map Legend: (Note: Trends are cast in the short term)

Up trends:
ANI 2GO ROCK ABS PIZZA APC These issues show continuing if not strong up trends. Look for trading
BLOOM AEV* RWM AC PX AT buys now if risk-reward measures are appealing or if not, buy into
CNPF AR SECB* AGI RCB BDO slight dips.
GERI AUB SMC* ALI RRHI BHI
HVN BEL TECH ANS SCC CHP Up trends, needy of reactions or are reacting:
JFC BPI TUGS AP SLI DMC
LR CIC* UBP* CEB SMPH DMPL
These issues show continuing up trends but are showing some
PHA CLI UNI CHIB SSI EAGLE reactive adjustments due to profit taking. Look for pullbacks to short
SBS COAL VITA CLC STI ELI term support or a rally from such support to cast fresh buy trades.
SGI CROWN VLL COSCO TEL FLI
DAVIN WLCON CPG URC HLCM Consolidations (Sideward trends):
DIZ DD X IMI These issues are running through consolidation phases. Either wait
DNL EEI LC for key range breaks or range trade and buy into a support bounce.
EDC EMP MA
FGEN EW MAXS Keep watch of possible range break bias in the following direction
FPH FDC NI [~-up/down, ^-up, *-down).
HOUSE FOOD PHEN
ION GLO PLC Down trends, needy of rallies or are rallying:
MRC GTCAP PNB These issues show continuing down trends but are undergoing a
MRP ICT SHLPH temporary/oversold rally. Lighten or sell into rebounds to resistance
MER* IS SM for now.
MWIDE JGS WEB
ORE* LPZ WPI Down trends:
OV LTG
PGOLD MARC
These issues show continuing down trends. Stay out for now until
PIP MBT better demand patterns appear.
PPG MEG
PNX MPI
PSE* MRSGI Stock Code Color Guide:
SSP* MWC
PXP NIKL
GREEN -These issues improved their technical condition for the week
RFM* NOW (moving to the left of their column category on the Tech Map)
RLC PCOR RED -These issues deteriorated on their technical condition for the week
Total Issues (change from last report) (moving to the right of their column category on the Tech Map)
0 (-4) 10 (-9) 44 (0) 45 (+14) 23 (-1)
BLACK -These issues carried the same technical condition for the week
(standing on the same column category on the Tech Map)
 Bullseye --- Page 5

US and European Markets

* Simple Moving Averages: 20-Period 50-Period
US indices rally but still below recent patterns
• US markets rallied for the week after recently
breaking below support of their area patterns.
Negative MACD readings still show which shows
that corrective pressure is still on leading us to
be ready for ongoing reactive swings. This
drives such indices to retest their 2-month lows
and to see whether support can make a stand
or allow for more downside action. Let us see if
the reaction in US Bond Yields and the rally in
the Dollar (both seen on page 7) can prove to
lend some help
• Short term Support and Resistance estimates
for US indices are shown below:
Dow: 23,360-22,945 – (R) 24,761-25,100
SP500: 2,552-2,532 – (R) 2,709-2,730
Nasdaq: 6,847-6,630 – (R) 7,234-7,300
Europe cascades within reactive channels:
• Euro-zone indices managed some recovery
action at the weeks’ end but remains locked
within corrective patterns. Recent lower lows
continue to show and thus keeps the corrective
trend open. A break over resistance (red down
trendlines) would be necessary to inspire wider
rally action
 Bullseye --- Page 6

Asian Markets
* Simple Moving Averages: 20-Period 50-Period
Asia was mixed with some recoveries and declines:
• Asian markets shows mixed swings with Thailand
and HK leading reactions while Japan, India and S.
Korea led rallies for the week. Reactive trends do
proceed but we may be able to see some occasion
rally swings as prices come close to or have come
from oversold levels
Asian Indices (for the week) YTD RSI
Japan 2.63% -7.05% 44.25%
India 1.14% -3.20% 41.01%
S Korea 0.81% -1.26% 46.56%
China 0.25% -4.43% 37.90%
Singapore 0.19% 0.74% 43.66%
Philippines 0.11% -6.76% 36.73%
Indonesia -0.50% -2.58% 35.76%
Malaysia -0.62% -0.37% 40.13%
Hong Kong -0.71% 0.58% 40.12%
Thailand -1.52% 0.75% 35.08%
Malaysia ($MYDOW) & Indonesia ($IDDOW) represented by their ETFs
• The PSEi (7,979 +0.11% WoW) was little higher by
9-pts for the week but remain below its recent
support zone. Still onto its corrective trend, the
PSEi may look towards 7,800-7,700 for next
support levels. Its intra-week low of 7,834 did
come close to this support brace and found some
temporary rebound ability. The index still needs to
find and reconfirm its next base – while doing so
we expect volatility to continue
 Bullseye --- Page 7

Currencies & Commodities* Simple Moving Averages: 20-Period 50-Period

US Bond Yields fall, Dollar rallies:
• The US Dollar index (89.81 +0.87% WoW) was
higher for the week after retesting its lows a
third time; a push over 90 may allow a recovery
to 90.50 or 92-92.50 (Sup 88.50-88.15/Res
90.50-92.50)
• The US 10-Yr Bond Yield [$tnx] (2.741% -3.14%
WoW) was lower for the week breaking below
its 2.8% support. Its reaction began after failing
its test of major resistance closer to 3.0%. (Sup
2.739-2.67/Res 2.838-3.00)
• The Euro (123.04 -0.42% WoW) eased slightly
and remains within a consolidation range of its
box. It sits closer to support (Sup 121.96-121.55
/ Res 124.78-125.11)
• Gold ($1,327.30 -1.67% WoW) slid for the week
after being blocked by major resistance $1,365.
A Support test is now seen (Sup 1,300-1,285
/Res 1,365-1,377)
• Copper ($3.03 +1.09% WoW) rallied after hitting
the low range of its reactive channel – it
remains within a cascade of this channel (Sup
2.938-2.894 /Res 3.06-3.12)
• Oil ($64.94 -1.43% WoW) slid after coming very
close to major resistance. Prices may need to
wind into a pattern for the time being while
resistance remains a challenge (Sup 62.48-
61.00/Res 66.66-67.00)