Philippine Equity Research

Jan 15, 2018

WEEK’S HIGLIGHTS
• The Philippines’ PSEi rebounded 44-pts for the week closing at a
Bullseye Report weekly new high
• Average Daily Value Turnover slowed to P7-B from P9.0-B the
Weekly Overview week previous
Issue Prev Wk Last Wk Wk Chg Wk Chg % YTD % • Net foreign flows were positive again this week at Php2.5-B from
Philippines 8,770 8,815 44.62 0.51 2.99 Php514-M the previous week
Peso-$ 49.865 50.4 0.535 1.07 0.94 • The PSEi (at 8,815) picked up by 0.51% proceeding with its
MSCI Phils 40.18 39.61 (0.57) (1.42) 2.04 advance to new highs. Recent breakouts and resistance breaks
PLDT US 29.35 28.47 (0.880) (3.00) (5.35) may set offer selective drives to advance but some overbought
DJIA 25,296 25,803 507.32 2.01 4.39 levels may have to swerve inwards to handle some extensions. Our
SP500 2,676 2,786 110.43 4.13 4.21 TechMap did show some strong advancers slow down with some
Nasdaq 7,037 7,261 224.50 3.19 5.18 reactions, but we still see a ood number of advancing stocks. Index
England 7,724 7,779 54.42 0.70 1.18 momentum slowed and may allow for some rotational swings…
Nikkei 23,715 23,654 (60.71) (0.26) 3.90 giving some stretched stocks some pause time while offering some
others an opportunity to push up
Hong Kong 30,815 31,413 597.90 1.94 4.99
China 3,392 3,429 37.19 1.10 3.68 • US markets were still on fire showing gains of 4% to 2% but
US 30yr Bond 150.77 149.46 (1.31) (0.87) (1.63) entering deeper overbought levels. The Dow drives along with a
10-Yr Yield 2.476 2.552 0.076 3.07 6.11 86% RSI and this is quite stretchy already. Europe saw some mixed
Dollar Indx 91.67 90.74 (0.93) (1.01) (1.19)
reactions as the Euro pushed up because of the Dollars push to a
new recent low. Commodities like Oil and Gold remained buoyant
Gold 1,322.30 1,334.90 12.60 0.95 1.96
due to the weak greenback. Some over-stretched up moves from
Oil 61.44 64.3 2.86 4.65 6.42
some global indices may need some corrective action soon
CRB Index 193.45 196.06 2.61 1.35 1.13
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 Inflows of P3.024-B

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

Philippines: PSEi & Peso-$

Recommendation:Trading buy (pref on reactions to support)
Support: 8,625 – 8,454 Resistance: 8,810 - 8,890
• The PSEi was up 44-pts (+0.51%) for the week and pushing
again into fresh highs
• Its MACD still suggests upward momentum is in place and
should try to carry forward
• But daily (and now weekly) RSI values have now entered
overbought levels which should bring in corrective sways
soon (hence the pref on buying into reactions)
• Prices are also quite far away from their short term
averages (16-day at 8,625 and 32-day at 8,454) which show
elevated risk from next support sites

Recommendation: Sell the Peso-Dollar on Rallies

Support: 49.70 - 49.33 Resistance: 50.50 - 50.78
• The Peso-$ (at 50.40) rallied after coming close to next
support- this may present a little rally time within a
corrective swing
• The recent slide below 51.09 had allowed prices to look for
next support which stands at 49.70 then 49.33
• Resistance is pegged at 50.50 first followed by 50.78
• Look to sell the P-$ into rallies closer to resistance for now
(or hold the Peso until a trend change is shown)
 Bullseye --- Page 4

Some Key Stocks and Trend Calls

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

Up trends:
2GO AEV ALI SLI ABS UNI ANI These issues show continuing if not strong up trends. Look for trading
AC AGI ANS VITA AR WEB APC
BDO BEL AP VLL^ COAL CLC
buys now if risk-reward measures are appealing or if not, buy into
CHIB BLOOM AT WLCON^ COSCO EW slight dips.
GTCAP BPI AUB WPI CPG FGEN
MBT DNL BHI X DAVIN GERI Up trends needy of reactions or are reacting:
PIZZA EAGLE CEB DD HLCM These issues show continuing up trends but are showing some
RRHI EEI CHP DIZ ION
SHLPH EMP CIC* DMC MAXS reactive adjustments due to profit taking. Look for pullbacks to short
UBP HOUSE CLI^ DMPL SSI term support or a rally from such support to cast fresh buy trades.
HVN CNPF ELI SSP
ICT CROWN FOOD STI Consolidations (Sideward trends):
JFC EDC GLO TEL
JGS FDC IS These issues are running through consolidation phases. Either wait
LTG FLI LC for key range breaks or range trade and buy into a support bounce.
MER FNI LR
MRP FPH^ MA
Keep watch of possible range break bias in the following direction
PGOLD IMI MARC [~-up/down, ^-up, *-down).
PHEN LPZ MRSGI
PNX MEG* MWC Down trends needy of rallies or are rallying:
SM MPI NI These issues show continuing down trends but are undergoing a
SMC MRC* NIKL
MWIDE temporary/oversold rally. Lighten or sell into rebounds to resistance
SMPH ^ ORE for now.
TECH NOW PCOR
TUGS OV PHA Down trends:
URC PSE PIP
RCB PLC
These issues show continuing down trends. Stay out for now until
RFM* PNB better demand patterns appear.
ROCK PPG
RWM^ PX
SBS PXP
SECB^ RLC Stock Code Color Guide:
SGI SCC GREEN -These issues improved their technical condition for the week
Total Issues (change from last report)
10 (-6) 26 (+17) 39 (-7) 35 (-1) 13 (-3) (moving to the left of their column category on the Tech Map)
RED -These issues deteriorated on their technical condition for the week
(moving to the right of their column category on the Tech Map)
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 extends advance, extends OB levels as well:
• US markets were higher last week with all three
major indices powering into fresh new highs.
This also pushed all three indices back to
overbought levels with the Dow now hitting an
RSI on 86% and Sp500 at 83% (these are quite
overbought). Up trends may persist but may be
interrupted by some corrective cascades. The
Volatility index has closed in on its 5-month
lows and suggests some complacency
(rendering overzealous bullishness) and could
be seen as an instigator to some short term
corrections. At the rate the US is advancing, it
may have to end with a blast. Many short term
targets have been hit and surpassed with even
extreme targets already being hit
• Short term Support and Resistance estimates
for US indices are shown below:
Dow: 25,054-24,702 – (R) 25,924-???
SP500: 2,715-2,683 – (R) 2,800-???
Nasdaq: 7,053-6,957 – (R) 7,295-???
Europe recovers and drives up:
• Euro-zone indices were showed some choppy
action with some reacting for the week. Though
their recent push up from support and some
breaks away from resistance does lean their
bias upwards
 Bullseye --- Page 6

Asian Markets
* Simple Moving Averages: 20-Period 50-Period
Asia was mostly higher:
• Asian markets continued well into the 2nd week of
the new year – still showing generous movements
for a few. A number of indices did however show
further reach into overbought levels… which may
drive the need for some corrections soon

Asian Indices (for the week) YTD RSI

Hong Kong 1.94% 4.99% 80.20%
India 1.28% 1.57% 70.49%
China 1.10% 3.68% 69.61%
Singapore 0.89% 3.46% 68.20%
Thailand 0.82% 3.22% 81.77%
Philippines 0.51% 2.99% 66.71%
Malaysia 0.35% 2.12% 70.78%
Indonesia 0.12% -0.38% 64.28%
S Korea -0.04% 1.17% 53.55%
Japan -0.26% 3.90% 67.49%
Malaysia ($MYDOW) & Indonesia ($IDDOW) represented by their ETFs

• The PSEi (8,814 +0.51% WoW) was up 44-pts for

the 2nd week of 2018. The index remains into an
advance but did show some slowing in upward
momentum. This drew some intraweek cascades
and rotation. We also still saw banks remain sturdy
as was the case in recent weeks. We expect this
week to still show some choppiness as prices have
to deal with some momentum slowdown and high
RSIs
 Bullseye --- Page 7

Currencies & Commodities

* Simple Moving Averages: 20-Period 50-Period
Dollar still soft, nearly oversold; Oil & Gold up:
• The US Dollar index (90.74 -1.02% WoW) slid
for the week and breaks into a new 3-yr low. Its
down trend remains but near oversold levels
show (Sup 90.30- 87.83/Res 92.11-92.74)
• The US 10-Yr Bond Yield [$tnx] (2.552% +3.07%
WoW) was higher and breaks over its Dec ’17
high of 2.499 and now moves to test a major
high of 2.621%. (Sup 2.48-2.428/Res 2.621-
2.692)
• The Euro (121.99 +1.41% WoW) proceeded to
advance but it closes in on overbought levels.
This may need some easing/pause time soon
(Sup 119.73-118.94 / Res 125.56-128.86)
• Gold ($1,334.90 +0.95% WoW) rallied for the
week and maintains an advancing trend –
promoted by the weakness in the Dollar (Sup
1,305-1,285 /Res 1,344-1,362)
• Copper ($3.22 -0.34% WoW) is easing after
recently coming from overbought levels. A
temporary reaction to next support is seen (Sup
3.21-3.14 /Res 3.32-3.45)
• Oil ($64.30 +4.65% WoW) was higher again for
the week as its up trend proceeds. Some
overbought conditions (in daily and weekly
views) may drive some choppiness but should
not yet end the advance (Sup 59.12-58.30/Res
70.00-77.83)