Metropolitan Bank and Trust Company closed the week with the exact same closing price it registered on Thursday at ₱36.05. Local investors were the main drivers of the price action today. Foreign investors registered a relatively small Net Foreign Selling worth ₱641,635.
The total turnover value was already relative slim at ₱27,531,560, which is self-explanatory due to today’s volume that didn’t go beyond MBT’s 10-day volume average.
Moreover, foreign investors’ seemingly relentless selling activity on MBT continues. They are net sellers year-to-date. MBT is still trading inside the downtrend channel.
Even though MBT’s historical volatility score of 21.95 percent poses a low-risk level for this name, I don’t translate that as a signal to buy.
I see MBT’s main support near ₱33.15, while the immediate resistance is positioned near ₱43.00.
I see a formation of a bullish divergence between the Moving Average Convergence Divergence (MACD) line and the signal line. Let me emphasize: I said “formation” and not “confirmation”. My data does not inspire me to say that MBT is about to rebound soon optimistically. I see the opposite. This stock might re-test the support near ₱33.15. The bearish Directional Movement Index (DMI) seconds the motion to that interpretation despite the fact that its Average Directional Index (ADX) is still below 25 points.
Trade-Volume Distribution Analysis
Last Price: ₱36.05
VWAP: ₱35.92323
Dominant Range: ₱35.70 – ₱36.05
These are the two bullish signals I see on my trade-volume distribution analysis:
- a last price that’s higher than the volume-weighted average price (VWAP) of ₱35.92
- a dominant range (₱35.70 – ₱36.05) that’s closer to the intraday high than the intraday low
Do I see a confirmed buy signal? I don’t.
My 10SMACD indicator is still bearish. My Momentum Power Indicator is also bearish. As to what these 10SMACD and Momentum Power Indicator are and how they become bearish or bullish, you need to watch the online stock market course that’s one of the five inclusions of our stock market consultancy service.
True Market Sentiment
True Market Sentiment: BEARISH
3 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: ₱35.8942
Top 10 Players’ Selling Average: ₱35.9353
Bonus Info:
9 out of 32 participants or 28.13% of all participants registered a 100% BUYING activity
9 out of 32 participants or 28.13% of all participants registered a 100% SELLING activity
This bearish True Market Sentiment concurs to the lack of a confirmed buy signal for MBT. For one, the top 10 players’ selling average today is higher than their buying average.
Recommendations
I’d like to talk to two types of investors or traders.
First, I’ll talk to those who already have MBT in their portfolio.
If that’s you, my question for you is this: Is your trailing stop still intact?
You have a big problem if you don’t know what a trailing stop is. I highly recommend using a trailing stop, whether you’re a long-term investor or a short-term trader, because it’s what can help you preserve your capital, protect your gains, and prevent unbearable losses. Write those three P’s down. I explained the importance of a trailing stop in the sixth lesson of my online stock market, which is available in Taglish and English. So, I’m not going to re-explain in this article what I already discussed in the online stock market course. Just log into your account and click the COURSE tab if you’re one of our clients.
If your trailing stop is intact, I’d recommend that you hold your position if you’re a high-risk investor. Averaging down is a waste of buying power because the downtrend is more likely to continue. Save your cash for now. Buy more once both 10SMACD and Momentum Power Indicator are bullish.
On the other hand, you may want to reduce the percentage of risk on your trailing stop if you’re a low-risk investor even if your trailing stop is still intact.
Feel free to use my trailing stop calculator on the TOOLS tab of our online stock market library.
Now, let me talk to you if you don’t have MBT yet.
It’s fine to add MBT in your watchlist but not in your portfolio yet. I repeat, there’s no confirmed buy signal for MBT yet. Even the deep-pocketed foreign investors don’t have the appetite to average down. Unless you’re wealthier than these foreign investors combined, then, don’t do a test-buy yet.
But once the 10SMACD and Momentum Power Indicator of MBT become bullish, don’t buy right away. There’s an extra process you need to do. That’s the calculation of your reward-to-risk ratio. I also have a reward-to-risk ratio calculator on the TOOLS tab of our online stock market library. Use it for free.
Would you like to know how to find the stocks that you should add in your watchlist, how to check if the current trend is more than likely to continue, how to know the true market sentiment, how to identify a confirmed buy signal, how to identify the best price range to trade, and how to sell more logically and less emotionally using my methodology?
Would you like to have access to our investment guide for long-term investors, 10 daily trade ideas for short-term traders, unlimited consultation in our Private Clients Forum as trading happens, and access to our Study Room?
If your answer is affirmative, read the full description of our stock market consultancy service at Equilyst Analytics first. Read every word. Don’t blink. Subscribe if you’d like to be helped the way we want to help you. If not, be your own teacher.
Can you tell me in the comments section if you find my analysis helpful?
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