Nickel Asia Corporation has been closing each week on a positive note since the day it broke out above its previous resistance near ₱2.00. NIKL went up by 7.45 percent at ₱3.03 today, August 10, 2020, with a total turnover value of ₱152 million.
I’ve been seeing a surge in NIKL’s volume since June 2020. That increase in volume was the force that broke the resistance at ₱2.00.
Foreign investors are still net sellers on NIKL year-to-date, but their participation in trading this mining company is not as significant as their trades on blue-chip companies. They registered a Net Foreign Selling worth ₱5.70 million today. So, I’m not going to dwell on foreign investors’ transactions on Nickel Asia Corporation.
The local investors were today’s main traders of NIKL. The previous resistance near ₱2.88 was broken today, and that makes ₱2.88 as the immediate support. The immediate resistance is near ₱3.45.
Others say that this ascent in price is caused by traders who want to take advantage of the cash dividend worth ₱0.22 per common share with an Ex-Div Date of August 18, 2020.
I say it’s too early to conclude that the cash dividend heavily influences the surge in price. Watch out for NIKL’s price-action on Friday (August 14) and Monday (August 17). That’s when you can get a good feel if the traders are significantly attracted by the dividend.
Related Article: Kailan Makakatanggap at Hindi Makakatanggap ng Dividends?
Nickel Asia Corporation is a high-risk stock due to its historical volatility score of nearly 92 percent. The upward momentum is strong based on the bullish divergence between the +DMI and -DMI. The bullish DMI is also supported by the bullish ADX, which is at 37 points already.
Trade-Volume Distribution Analysis
Last Price: ₱3.03
VWAP: ₱3.03
Dominant Range: ₱3.00 – ₱3.05
Even though my 10SMACD combo is already bullish, the Momentum Power Indicator of NIKL is bearish. My ideal setting is the last price that’s higher than the Volume-Weighted Average Price (VWAP). In this case, NIKL’s last price and VWAP are equal. I want to take this as a clue that the price might fill the gap at the bottom tomorrow and re-test the support near ₱2.88. The operative word is “might”.
Additionally, the dominant range of ₱3.00 – ₱3.05 is closer to the intraday low than the intraday high. We don’t like that at Equilyst Analytics if we’re looking for a confirmed buy signal.
True Market Sentiment – EOD – August 10, 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: ₱3.0272
Top 10 Players’ Selling Average: ₱3.0234
Bonus Info:
13 out of 65 participants or 20.00% of all participants registered a 100% BUYING activity
15 out of 65 participants or 23.08% of all participants registered a 100% SELLING activity
True Market Sentiment – MTD – August 3-10, 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: ₱2.8336
Top 10 Players’ Selling Average: ₱2.8292
Bonus Info:
8 out of 87 participants or 9.20% of all participants registered a 100% BUYING activity
20 out of 87 participants or 22.99% of all participants registered a 100% SELLING activity
The neutral True Market Sentiment for today and month-to-date seems like it’s telling me not to be too confident to think that the ascent of NIKL is more likely to continue. It’s telling me to analyze this stock one day at a time to make a relevant data-driven interpretation based on the latest data.
Recommendations
Do you have Nickel Asia Corporation in your portfolio already?
If yes, I’ll assume that your trailing stop is intact. Based on everything I’ve analyzed above, I’d recommend that you hold your position. If the price continues to go up, make an upward adjustment on your trailing stop. Then, re-analyze to see if the Momentum Power Indicator is already bullish. If you’re one of our clients, just post a request in our Private Clients Forum and we’ll send our fresh analysis. If we see a confirmed buy signal in our fresh analysis, you may top up within the dominant range, which we will also provide. Do not top up at any price you see under the ASK column. Top up or buy within the dominant range only so that you’re more realistic and strategic.
Nickel Asia Corporation is in your watchlist only, but you’re planning to do a test-buy?
It’s not yet the most logical time for you to do a test-buy, especially if you’re a new trader. Mind you, NIKL is a high-risk stock already. I’m talking about the erraticity of its price’s fluctuation whenever I say risk level. Wait for its 10SMACD and Momentum Power Indicator to become bullish. Once they’re both bullish, calculate your reward-to-risk ratio. If you’re satisfied with the ratio, you can do a test-buy within the dominant range. As I mentioned above, you can always request our latest analysis on any stock in our Private Clients Forum if you’re one of our clients.
Feel free to use our reward-to-risk ratio calculator, trailing stop calculator, and other trading calculators on the TOOLS tab of our online stock market library.
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