Jollibee (JFC) Technical Analysis: Continue to Buy or Prepare to Sell?

Jollibee Foods Corporation (JFC) Technical Analysis

Jollibee Foods Corporation (JFC) closed on Thursday, November 5, 2020, at ₱194.20, which is 4.79 percent higher than its previous closing price. The total turnover value (TTV) was ₱389.50 million, which is a relatively significant amount. Its significance is visible on its green last volume bar that is higher than the 100 percent of JFC’s 10-day volume average.

The local investors were the main movers of the price. Usually, it was the foreign investors. I’m not expecting the foreign investors to appear as the main drivers of index companies because their participation is relatively insignificant, generally speaking. You can see that by their percentage of contribution to the Philippine Stock Exchange Index’s total turnover value. Yesterday, the foreign investors only partook 31 percent of the PSEi’s ₱9.77 billion TTV. The foreign investors remain as net sellers year-to-date.

Jollibee just broke the previous resistance near ₱185.20, which is now acting as its immediate support. The immediate resistance is now pegged near ₱200.00, a precursor to ₱217.70, followed by ₱234.35.

Jollibee’s price is already moving above its 10-day simple moving average (SMA), and its MACD line is positioned above its signal line. That combination makes my 10SMACD combo bullish. It now takes a bullish Momentum Power Indicator for Jollibee to have a confirmed buy signal. Let’s find out the status of its Momentum Power Indicator in my trade-volume distribution analysis shortly.

Despite Jollibee’s recovery from its year-to-date low of ₱91.10 last March 19, 2020, it managed to keep its moderate-risk level based on its 10-day historical volatility score of 54 percent.

Jollibee’s bullishness is confirmed by its directional movement index’s (DMI) chart. Its +DMI is hovering the -DMI, and the average directional index (ADX) is already higher than 25 points. That’s a confirmation that Jollibee’s upward momentum remains strong.

Trade-Volume Distribution Analysis

Last Price: ₱194.20
Intraday Low: ₱184.80
Intraday High: ₱199.00
VWAP: ₱193.88
Dominant Range: ₱194.20 – ₱194.20

Jollibee’s Momentum Power Indicator is bullish because all of its four elements are bullish. A detailed discussion of these four elements and how to check them is discussed in our online stock market course (videos are both available in Tagalog and English). Please log into your account if you’re one of our clients to re-watch the course.

If Jollibee starts at a price higher than ₱194.20 by the next trading day, monitor the range between ₱195.50 and ₱196.00. If it starts at a price lower than ₱194.20, monitor the range between ₱192.00 and ₱192.40. What’s up with those two ranges? Those are the two other dominant ranges. You’ll see it in my trade-volume distribution chart.

True Market Sentiment – EOD (November 5, 2020)

True Market Sentiment: BEARISH
4 of the top 10 brokers registered a positive Net Amount
3 of the top 10 brokers registered a higher Buying Average than Selling Average
Top 10 Players’ Buying Average: ₱193.5915
Top 10 Players’ Selling Average: ₱194.4328
11 out of 64 participants, or 17.19% of all participants, registered a 100% BUYING activity
24 out of 64 participants, or 37.50% of all participants, registered a 100% SELLING activity

True Market Sentiment – WTD (November 3-5, 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: ₱186.1580
Top 10 Players’ Selling Average: ₱183.8847
8 out of 79 participants, or 10.13% of all participants, registered a 100% BUYING activity
26 out of 79 participants, or 32.91% of all participants, registered a 100% SELLING activity

True Market Sentiment – MTD (October 1, 2020 – November 5, 2020)

True Market Sentiment: NEUTRAL
4 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: ₱164.8749
Top 10 Players’ Selling Average: ₱165.5710
5 out of 113 participants, or 4.42% of all participants, registered a 100% BUYING activity
13 out of 113 participants or 11.50% of all participants registered a 100% SELLING activity

The average rating of Jollibee’s True Market Sentiment across all three timeframes is neutral. Don’t take this as if it’s a data-driven reminder for you to lock-in your profits already just because the overall True Market Sentiment is not bullish. Take this as a data-driven clue to be more vigilant on your trailing stop. Jollibee has been breaking one lower-high (previous resistance levels) after another. There will come a time when the major players will think that Jollibee will need to rest for a bit before it continues its ascent (if it still has more-than-enough gas to move up). If and when that happens, expect the major players to sell near the resistance levels. So, eyes on your trailing stop, please.

Recommendations

I’ve given most of my recommendations above already.

Suppose you already have Jollibee, your trailing stop is intact, and you would like to buy more shares. If that’s your case, you may buy within the dominant range. Keep in mind the two other ranges I mentioned in my trade-volume distribution analysis. Know that the dominant ranges are subject to change based they are based on the PREVAILING price action. Therefore, ask for our latest trade-volume distribution analysis in our Private Clients Forum if you’re one of our clients.

Additionally, do an upward adjustment on your trailing stop every time the price moves higher than the previous price that you used as your basis in calculating or adjusting your trailing stop. Only by this can you preserve your capital, protect your gains, and prevent unbearable losses. If this sounds confusing to you, review or re-watch our online stock market course on the COURSE tab of your account at Equilyst Analytics. I recorded that course both in Tagalog and English. Choose which one you’d like to listen to. Ask in the EVERGREEN STRATEGY section of our Private Clients Forum if you need to seek clarification on anything you’ll hear from me in the online stock market course. I’ll personally respond to you in the Private Clients Forum.

If you don’t have JFC yet, calculate your reward-to-risk ratio before you click the buy button. You can use my reward-to-risk ratio calculator. It’s in the TOOLS tab of our online stock market library. Do a test-buy only if you’re satisfied with the reward-to-risk ratio. Once your trade is executed, calculate your initial trailing stop immediately. You’ll find my trailing stop calculator in our online stock market library, too.

Again, ask for our latest Jollibee analysis in the LONG-TERM INVESTING section of our Private Clients Forum if you see significant changes in its price and volume. By the way, we automatically display our latest recommendation and updates for Jollibee in the Investment Guide for Long-term Investors table because it’s a blue-chip company.

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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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