Jollibee Foods Corporation (JFC) Analysis
Jollibee Foods Corporation (JFC) surged by 4.10 percent at ₱144.80 as of September 29, 2020. JFC’s total turnover value was relatively sizable at ₱226.75 million.
Foreign investors contributed significantly to Jollibee’s bullishness by registering a net foreign buying worth ₱91 million. Even if foreign investors register a net foreign buying for five consecutive trading days, they are still net sellers year-to-date. Out of the nine months that have passed, only three months ended with a net foreign buying status. Foreign investors registered their biggest month-end net foreign selling in May 2020, amounting to ₱400 million.
Since Jollibee is an index company, I see no consistent issues on its daily volume since most days are above 50 percent of Jollibee’s 10-day volume average.
Jollibee is trading above its 10-day simple moving average (SMA). Its moving average convergence divergence (MACD) is also moving above the signal line. That’s a bullish combination. Hence, the 10SMACD combo of Jollibee is bullish.
Additionally, the +DMI is hovering the -DMI. Even though Jollibee’s upward momentum is not yet confirmed strong since its average directional index (ADX) is still below 25 points, it’s more likely to reach that point once the price draws closer or breaks the immediate resistance.
Jollibee’s immediate resistance is near ₱151.80, while its immediate support is spotted near ₱125.85. If it breaks below the immediate support, ₱109.45 will be the next support. If it breaks above the immediate resistance, ₱184.00 will be the new resistance.
Suppose you are a beginner and have no idea yet how to plot support and resistance levels using horizontal lines, SMAs, Bollinger Bands, or Fibonacci. In that case, you may use our support and resistance calculator. You’ll find it in the TOOLS tab of our online stock market library. Nonetheless, I recommend that you train yourself on how to plot support and resistance levels, at least, using horizontal lines. There are many tutorials on YouTube.
Moreover, Jollibee has a low-risk level due to its 10-day historical volatility score of 37 percent. This means the stock does not fluctuate erratically. Low- to moderate-risk stocks are newbie-friendly ones, so to say.
Trade-Volume Distribution Analysis
Last Price: ₱144.80
VWAP: ₱143.30
Dominant Range: ₱144.70 – ₱144.80
I mentioned above that the 10SMACD of Jollibee is already bullish. Here at Equilyst Analytics, the stock’s 10SMACD combo and Momentum Power Indicator must be bullish to have a confirmed buy signal. So, how’s the Momentum Power Indicator of JFC?
All four elements of our Momentum Power Indicator for Jollibee are bullish. Therefore, its Momentum Power Indicator is bullish.
This combination means that there’s a confirmed buy signal for Jollibee as far as our proprietary methodology at Equilyst Analytics is concerned.
You’ll find my detailed explanation of the elements of our 10SMACD and Momentum Power Indicator in our online stock market course (The Evergreen Strategy in Trading and Investing in the Philippine Stock Market). I recorded two videos in Tagalog and English.
True Market Sentiment – EOD (September 29, 2020)
True Market Sentiment: NEUTRAL
6 of the top 10 brokers registered a positive Net Amount
4 of the top 10 brokers registered a higher Buying Average than Selling Average
Top 10 Players’ Buying Average: ₱143.3513
Top 10 Players’ Selling Average: ₱143.5281
6 out of 69 participants or 8.70% of all participants registered a 100% BUYING activity
34 out of 69 participants or 49.28% of all participants registered a 100% SELLING activity
True Market Sentiment – WTD (September 28-29, 2020)
True Market Sentiment: NEUTRAL
5 of the top 10 brokers registered a positive Net Amount
6 of the top 10 brokers registered a higher Buying Average than Selling Average
Top 10 Players’ Buying Average: ₱142.5954
Top 10 Players’ Selling Average: ₱141.9182
5 out of 74 participants or 6.76% of all participants registered a 100% BUYING activity
33 out of 74 participants or 44.59% of all participants registered a 100% SELLING activity
True Market Sentiment – MTD (September 1-29, 2020)
True Market Sentiment: NEUTRAL
6 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: ₱135.2951
Top 10 Players’ Selling Average: ₱136.0824
13 out of 100 participants or 13.00% of all participants registered a 100% BUYING activity
7 out of 100 participants or 7.00% of all participants registered a 100% SELLING activity
What did you notice in the True Market Sentiment status of Jollibee across three timeframes?
They’re all neutral.
This situation is a data-driven reminder that you should be cautious about your investment decisions. Since Jollibee’s share price is closer to the immediate resistance than the immediate support, we cannot help but think that the price might reverse once it hits the resistance level. After all, Jollibee has had two failed attempts to break above the immediate resistance this 2020.
What does this mean to an investor like you?
This situation means you need to calculate your reward-to-risk ratio first if you are yet to enter a new position on Jollibee. An ideal scenario is when the last candlestick is closer to the immediate support than the immediate resistance. That situation means you have a bigger potential reward than the potential risk.
However, this is not a concern if you already have a position on Jollibee. I recommend the process of calculating the reward-to-risk ratio for those who are yet to enter a new position (for those who are yet to do a test-buy).
Recommendations
I’ve mentioned data-driven recommendations above already, but here are some additional ones.
Buy in tranches if your buying power is more than ₱20,000.00, if you’re a beginner, and if you already have a position on JFC. Sell once your trailing stop is hit. Use a trailing stop because it helps you preserve your capital, protect your gains, and prevent unbearable losses. You’ll hear my complete explanation of this in the sixth lesson of our online stock market course.
By the way, you’ll find our reward-to-risk ratio and trailing stop calculators in the TOOLS tab of our online stock market library.
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