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First Philippine Holdings (FPH) Undecided Of Its Trend

Jan. 24, 2011 10:16 AM ET
lytman02 profile picture
lytman02's Blog
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Hello guys, the Philippine Stock Market hasn’t been performing lately. Many blue chips have broken down from its immediate uptrend like the stocks of Filinvest Land Inc (FLI) among others. I had a post on this before it broke down (kindly see here). We’ve seen breakdowns from bearish reversal patterns as well like in Megaworld Corporation (MEG) which I mentioned more than a week ago (here)  and EEI Corporation (EEI) which I posted over the weekend (here).

On today’s canvass, though, is the daily chart of First Philippine Holdings Corporation (FPH) which is owned by the Lopez family along with ABS-CBN Corporation (ABS), Lopez Holdings Corporation (LPZ) and First Gen Corporation (FGEN). At present, the company is working on their solar  plant at Tanauan, Batangas in its pursuit for  an alternative energy source for the country. It’s really great to hear that more companies are opting for greener energy solutions nowadays.

Technically, the shares of FPH remain on a longer term uptrend despite their recent fall. Today, FPH  closed right above its 2-year uptrend. And if you look closely, FPH could be forming symmetrical triangle pattern which has been four months in the making. Now, a successful rebound from the  major uptrend  could propel the stocks higher and increase its chance of breaking out from the said pattern. The chances of this happening is actually greater since the symmetrical triangle is coming off an uptrend. So in case it breaks out to the upside, it could reach the PHP 80.00 target price. I got this by getting the size of the triangle’s base and added it to the possible breakout point. However, it first needs to clear out the PHP 69.50 and PHP 72.00 resistances. On the bearish note, if the 2-year trend and the symmetrical triangle’s support get breached, the stocks could fall towards a downside target price of PHP 51.00. Before it reaches that, though, it first  needs to break the immediate support at PHP 59.15.  In the near term,  bias on FPH could be bullish since the MACD is still above the positive territory.  But with the stocks  currently moving below the 50 and 100-period moving averages, showing a sign of weakness, an unfortunate event of a breakdown could happen as mentioned. Better stay on your toes then!

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