Sentimental and Technical Analysis for Security Bank Corporation (PSE:SECB)
Security Bank Corporation (PSE:SECB) managed to rebound from the support level near 104 per share in the third week of March 2022. The standing resistance is near 113. I know you’re eager to ask if it’s more likely for SECB to soar above 113 before April 7, 2022, the ex-dividend date of the P1.50 per common share cash dividend.
I’d say that two major contributing factors will create my bullish forecast. The dominant range that got the biggest volume and highest number of trades shouldn’t be closer to the intraday low than the intraday high, and the market sentiment index shouldn’t be bearish for three consecutive trading days.
The first criterion refers to the Dominant Range Index of SECB. You can request the Dominant Range Index of any stock in our Private Clients Forum if you’re a client of Equilyst Analytics.
As of the time of writing, here are the statistics of the market’s sentiment for SECB:
12 of the 21 participating brokers, or 57.14% of all participants, registered a positive Net Amount
12 of the 21 participating brokers, or 57.14% of all participants, registered a higher Buying Average than Selling Average
21 Participating Brokers’ Buying Average: ₱110.61872
21 Participating Brokers’ Selling Average: ₱110.88643
9 out of 21 participants, or 42.86% of all participants, registered a 100% BUYING activity
6 out of 21 participants, or 28.57% of all participants, registered a 100% SELLING activity
SECB has been in the downtrend channel for four years already. If you’ve had this stock in your portfolio since 2018, I know you’ve not made decent profits based on capital appreciation, even if you bought a significant amount of shares on every single major dip.
Concerning the eligibility for cash dividends, I also know that some of you would like to know if you are eligible to receive cash dividends if you buy or sell before, on, or after the ex-dividend date of April 7, 2022.
Every SECB share you already have BEFORE the ex-dividend date is entitled to receive the dividend. Every share you buy ON and AFTER the ex-dividend date is not qualified to receive the dividend.
On the other hand, every single SECB share you will sell BEFORE the ex-dividend date won’t get dividends. Meanwhile, the shares you’ll sell ON or AFTER the ex-dividend date are qualified.
Foreign Investors
I don’t see the foreign investors positioning themselves as the major influencers of the sentiment in trading SECB. They’ve been inconsistent with their 8-digit net foreign amounts. I estimate that they’re also net sellers year-to-date.
Volume
Although SECB’s daily volume is not at an alarming level, I like its volume more between the last week of January and the last week of February than the weeks after that. If we want to see the price piercing the resistance at 113, we need to see a green volume bar higher than 100% of SECB’s 10-day volume average.
Moving Average Convergence Divergence
It’s still bullish. The MACD line has not bent in the southward direction. But don’t base your decision on a single indicator.
Still a Newbie-friendly Stock?
Security Bank is relatively newbie-friendly due to its 10-day historical volatility score of 28%. It has a low erraticity level. Like what I mentioned regarding SECB’s MACD line, don’t base your decision on a stock’s erraticity level alone. Not every stock with a low to medium erraticity level has a confirmed buy signal.
Is There a Confirmed Buy Signal?
Let’s look at the ratings of the six indicators that compose my proprietary methodology called The Evergreen Strategy in Trading and Investing in the Philippine Stock Market. If all of them are bullish, there’s a confirmed buy signal.
Once there’s a confirmed buy signal, you need to calculate your reward-to-risk ratio and initial trailing stop. Do a test-buy or top-up on your existing shares if and when you’re satisfied with the ratio.
Parameter 1: Is its last price moving above its 10-day simple moving average (SMA)?
Answer: YES
Parameter 2: Is its last volume bar higher than 50 percent of its 10-day volume average?
Answer: NO
Parameter 3: Is its moving average convergence divergence (MACD) above its signal line?
Answer: NO
Parameter 5: Is its Dominant Range Index bullish?
Answer: Login to your account and ask for the DRI of this stock.
Parameter 6: Is its Market Sentiment Index bullish?
Answer: Login to your account and ask for the DRI of this stock.
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