Charts: Watching SMC closely

When I started my trading journey, I started reading books by Bo Sanchez with regards to investing in the Stock Market. His books are quite a good read, and that it is always very inspiring because, if his maid can do it, why can't I?

Then I started to read other books authored by Benjamin Graham, books about Warren Buffet and the like, which focused on Fundamental Analysis. Then I have read about investing in index stocks as volatility is quite low, and that investors/traders are quite active with regards to index stocks.

One of the very first stocks I bought is SMC, and that if I remember correctly, I only lost one trade with SMC. Well, at first I held SMC for quite a long time as I am still studying how to do technical analysis. And that has led me to making this article.

When I opened my computer tonight after I arrived home, I checked my computer and ran my exploration tool in Amibroker. The first thing that popped out on my filter is SMC, so I'll be discussing SMC briefly.

Figure 1: SMC Daily Chart

As shown, there is a break in trendline, but I am sensing it is just a slip and might get back to trendline. As of the moment, SMC is kissing the 50-SMA (Spyfrat system) with RSI at above 50 level and might find some support. This is one way of how I do buy signals, if there's a high probability trade, I would take it. But remember that SMC is an index stock, thus the trader should always have to check about the bias of PSEi.

Figure 2: SMC Quarterly chart

If you look at the quarterly chart, this should be a buy on dips with cut-loss point of Php78.35. I also am using range segmentation. Well, there has been some commotion with this strategy in Investagrams, but for me, I begun to study about it because I saw Jiego's post in Bookaka and made me wonder how on earth does each stock always respect the supports and resistance levels. Although what I have different from Jiego, I have been able to use it to my trading systems and it kind of blend to me also.

Figure 3: S&R Levels

Currently, SMC is sitting into its midpoint and as you can see, large drop in price but has low volume, so you might look at it as a good indicator. Cut-loss below Php78.125.

Trade your plan, and plan your trade as always. Caveat!



Disclaimer: Trading is a risky thing and the post in this site are for educational purposes only. Equities and Forex Trading is speculative in nature and may harm every trader and investor by losing money. Thus, do not treat this post as a recommendation to BUY or SELL a stock or a currency pair. Blog contents are valid only on the date of publication and will be subject to change without notice. Thus, the reader is advised to take precaution, and is recommended to do their own studies before pressing the BUY and SELL buttons. I will not take any responsibility with the readers trading results.

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