Pacific Online Systems Corporation (LOTO) is trading at 2.50 per share as of July 29, 2019 at 2:26PM GMT+8, down by 14.97 percent. All casino-related stocks are affected by President Rodrigo Duterte’s pronouncement to shutdown the Philippine Charity Sweepstakes Office (PCSO) for an alleged corruption in the agency.
As a technical analyst, I am not going to talk too much about news or disclosures. Let’s focus on the data that we have.
I’ve plotted a Down Fibonacci to identify the support and resistance levels of LOTO.
With the swing high pegged near 5.30 and the swing low near 2.90, the 61.8 percent Down Fibonacci retracement is near 1.50. That acts as the major support of LOTO. Resistance is near 2.90.
I am not going to emphasize the participation of the foreign investors on LOTO since their daily Net Foreign amount is relatively insignificant.
My 10SMACD combo is invalid. If you attended my The Evergreen Strategy in Trading the Philippine Stock Market seminar (advanced), you know what this 10SMACD combo is for and why I am checking it.
RSI is already playing inside the classical oversold level. The risk level of LOTTO has already become high due to the sudden fluctuation of its historical volatility near 90 percent. Moreover, the DMI and ADX tandem confirms that the downward momentum remains strong.
I’d like to add that the three simple moving averages (10, 50, 200) that I’m using have been aligned in a perfect bearish position even before the pronouncement of President Duterte for the closure of all PCSCO outlets.
Trade-Volume Distribution
Last Price: 2.50
VWAP: 2.351351981
Most Traded: 2.4 – 2
Most Voluminous: 2.49 – 2
While LOTO has gapped down today, it’s intraday recovery from its intraday low is evident on my Trade-Volume Distribution chart. You and I see that the dominant standalone price point is at 2 per share, but there’s a dominant range between 2.45 and 2.55.
True Market Sentiment
True Market Sentiment of LOTO as of Jul-29-2019 at 02:24PM, with a last price of 2.500.
3 of the top 10 brokers registered a positive Net Amount
3 of the top 10 brokers registered a higher Buying Average than Selling Average
True Market Sentiment: BEARISH
Top 10 Players’ Buying Average: 2.3407
Top 10 Players’ Selling Average: 2.3300
Bonus Info:
11 out of 31 participants or 35.48% of all participants registered a 100% BUYING activity
6 out of 31 participants or 19.35% of all participants registered a 100% SELLING activity
Despite the intraday recovery of LOTO, the top 10 brokers are hesitant to trade LOTO by a significant level. By simply looking at the Total Turnover Value of each of the top 10 brokers, you can already sense the hesitation among traders.
Recommendations
If you pre-empted my 10SMACD combo because the four criteria of my Momentum Power Indicator are all present, which led you to doing a test-buy on LOTO today, I suggest that pay close attention to the dominant range I mentioned above. Respect your trailing stop loss. Do not do my pre-emption technique if you are not an experienced trader or if you haven’t mastered yet the six lessons I taught you during my The Evergreen Strategy in Trading the Philippine Stock Market seminar. I do not advise topping up at this point.
Are you planning to enter a new position on LOTO now that it’s at 2.50? Are you a newbie trader? If that’s the case, I strongly suggest that you wait for the 10SMACD combo to be revalidated and for the Momentum Power Indicator to have a bullish rating. Your potential reward will be greater than your potential risk when those two are valid and bullish, respectively.
Please post a request for LOTO’s latest Trade-Volume Distribution and True Market Sentiment charts in our Private Clients Forum if and when this stock traders at a price lower or higher than the dominant range I stated above.
If you’re a regular reading of my freemium stock analyses and you can’t relate what 10SMACD, Momentum Power Indicator, Trade-Volume Distribution, or True Market Sentiment are, these are my proprietary methodologies in trading. You won’t find them on Google. I suggest that you attend my The Evergreen Strategy in Trading the Philippine Stock Market seminar to advance your knowledge.
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