APL Technical Analysis: What to Do if the Selling-Spree’s Not Over Yet?

Apollo Global Capital, Inc. dropped by 12.50 percent and ended at P0.28 per share on January 25, 2021. Despite a relatively sizable turnover value of P1.117 billion, the foreign investors printed a net foreign selling worth P30.70 million. Local traders and investors were today’s main drivers of the price-action.

APL is on the brink of breaking below the immediate support confluent to its closing price of P0.28. The immediate resistance is near P0.35, confluent to the 23.60 percent retracement of the Up Fibonacci.

APL is an extremely high-risk stock because of its 10-day historical volatility score of 300 percent. Even if the MACD line hovers the signal line, I see a formation of a bearish convergence of the two lines. It’s the same view on the DMI’s histogram.

Apparently, the selling-spree is not yet over because the red volume bars for the past two trading days are both sizable. Last Friday’s red volume was higher than APL’s 10-day volume average. Today’s red volume bar almost engulfed the 10-day volume average. If you’re hoping to see some signs of selling exhaustions, that’s not what you want to see on the volume’s histogram.

There’s no confirmed buy signal because both 10SMACD and Momentum Power Indicator are bearish.

Trade-Volume Distribution Analysis

Last Price: ₱0.28
Intraday Low: ₱0.2800
Intraday High: ₱0.3450
VWAP: ₱0.3107
Dominant Range: ₱0.28 – ₱0.28

APL couldn’t get a bullish Momentum Power Indicator because its last price is lower than its VWAP. Plus, the dominant price is the intraday low itself. The next dominant range is between P0.31 and P0.315.

True Market Sentiment EOD – January 25, 2021

True Market Sentiment: NEUTRAL
5 of the top 10 brokers registered a positive Net Amount
5 of the top 10 brokers registered a higher Buying Average than Selling Average
Top 10 Players’ Buying Average: ₱0.3103
Top 10 Players’ Selling Average: ₱0.3129
26 out of 86 participants, or 30.23% of all participants, registered a 100% BUYING activity
2 out of 86 participants, or 2.33% of all participants, registered a 100% SELLING activity

It’s quite hard to speculate that APL can sustain its position above the immediate support at P0.28 just because today’s True Market Sentiment is neutral. Wealth Securities has sold quite a lot today. In fact, it’s the biggest seller among the top 10 players of APL today.

It is prudent to stay in a wait-and-see mode and witness if the 30 percent of today’s participants (brokers) who registered a 100 percent buying activity can help APL stay at or above P0.28.

Recommendations

Suppose you don’t have APL yet. If that’s your case, I don’t recommend doing a test-buy yet. You are better off waiting for the price to break above the 10SMA and re-check if both 10SMACD and Momentum Power Indicator are already bullish when that happens. Once they’re both bullish, you’ll have to calculate your reward-to-risk ratio. If you’re satisfied with the RRR, that’s when you’ll do a test-buy within the prevailing dominant range.

Now, if you already have a position on APL and if your trailing stop is intact, I recommend reducing the percentage of risk on your trailing stop. Don’t just hold your position. Don’t top up yet, too. The downtrend is more likely to continue unless the prevailing True Market Sentiment becomes bullish or both 10SMACD and Momentum Power Indicator become bullish.

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Jaycee De Guzman

Founder and CEO at Equilyst Analytics

Experience the expertise of Jaycee De Guzman, the brain of Equilyst Analytics, renowned for his unique data analysis. He is a computer scientist and a self-taught digital marketing strategist and agriculturist. Since Equilyst Analytics’ founding in 2012, over 10,000 local and foreign clients have consulted with Jaycee de Guzman on crypto and stock investments.

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