BDO Unibank, Inc. (BDO) advanced on Tuesday, September 1, 2020, at ₱87.60, by 1.86 percent, and with a total turnover value of ₱468.20 million. The foreign investors closed with a net foreign selling worth ₱17.90 million, even if they were the said banking company’s main drivers. Foreign investors remain as net sellers year-to-date.
BDO’s immediate support lies near ₱85.00, while its immediate resistance is near ₱97.25. Don’t interpret this as having a better potential reward than the potential risk just because the last price is closer to the immediate support than the immediate resistance. For one, I don’t see a confirmed buy signal yet. Let me break it down further for you.
BDO maintains its low-risk level due to its historical volatility score of 26.86 percent. Be reminded that I’m referring to the erraticity of the price (fluctuation) when I say “risk level”. Having a low-risk level is not synonymous to “go ahead and buy the stock now”.
The MACD line is far from registering a golden cross above the signal line. The hovering of the -DMI above the +DMI adds more pain to the injury of the bulls. The bears are not yet done partying.
Trade-Volume Distribution Analysis
Last Price: ₱87.60
VWAP: ₱87.54
Dominant Range: ₱87.35 – ₱87.60
The 10SMACD is bearish because MACD remains below the signal line. Also, the Momentum Power Indicator for BDO remains bearish because not all four elements are bullish. For one, the dominant range is closer to the intraday low than the intraday high. It’s not enough that the last price is higher than the volume-weighted average price (VWAP).
At this point, I’ve given you data-driven reasons why I said, “there’s no confirmed buy signal”, for BDO yet.
True Market Sentiment – EOD (September 1, 2020)
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: ₱87.5646
Top 10 Players’ Selling Average: ₱87.5386
Bonus Info:
9 out of 49 participants or 18.37% of all participants registered a 100% BUYING activity
8 out of 49 participants or 16.33% of all participants registered a 100% SELLING activity
True Market Sentiment – WTD (August 24-28, 2020)
True Market Sentiment: BEARISH
5 of the top 10 brokers registered a positive Net Amount
2 of the top 10 brokers registered a higher Buying Average than Selling Average
Top 10 Players’ Buying Average: ₱87.0100
Top 10 Players’ Selling Average: ₱87.0848
Bonus Info:
42 out of 95 participants or 44.21% of all participants registered a 100% BUYING activity
2 out of 95 participants or 2.11% of all participants registered a 100% SELLING activity
True Market Sentiment – MTD (August 3-28, 2020)
True Market Sentiment: BEARISH
4 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: ₱88.8086
Top 10 Players’ Selling Average: ₱89.2091
Bonus Info:
21 out of 110 participants or 19.09% of all participants registered a 100% BUYING activity
2 out of 110 participants or 1.82% of all participants registered a 100% SELLING activity
The True Market Sentiment charts and statistics of BDO for three timeframes do not support the idea of seeing a rebound in price soon. The downtrend is more likely to test the immediate support at ₱85.00.
If and when the immediate support is broken, we’re looking at ₱75.00 as the next support level. On the other hand, the resistance at ₱97.25 is a precursor to the next resistance at ₱114.40.
Recommendations
If you’re one of my regular readers at equilyst.com, you already know what I am about to say here.
If there’s no confirmed buy signal, don’t buy the stock. When I say “don’t buy the stock,” it means it’s not recommended to top up, average down, enter a new position, or whatever you want to call it. Otherwise, you’re wasting your buying power. While it’s true that no one can say with 1 million percent accuracy what will happen next, my forecast is data-driven and not just based on what I believe, feel, or think. Why don’t you read the hundreds of articles I published on this website and see it for yourself if my methodology will give you more wins than losses? Just make sure you UNDERSTAND my methods, and you don’t prematurely test it right before you get a clear and right understanding of it.
If you already have BDO, hold your position if your trailing stop is intact. If your trailing stop is already broken, what else are you waiting for? Cut your loss. After all, the reason why you are using a trailing stop is for you to avoid seeing yourself holding a position on any stock beyond what you can realistically handle or tolerate. I hope you’re aware of that.
If and when BDO got a bullish 10SMACD and Momentum Power Indicator, that’s when you need to calculate your reward-to-risk ratio. If you’re satisfied with your reward-to-risk ratio, that’s when you do a test-buy within the dominant range. You buy within the dominant range and not at any price under the ASK column, so you’ll become strategic and realistic.
You can use my reward-to-risk ratio and trailing stop calculators in the TOOLS tab of our online stock market library.
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