Michael’s Trading Blog

航天科技 China Aerospace Intl (0031) has been consolidated between $0.60 – $0.70 since mid June this year. Building a strong foundation to take off? OR breakout to downside?

0031 announced its first-half to June net profit of $53.47 mln HKD vs $18.83 mln HKD same period last year. The company said the net profit was higher compared to the year earlier even as operating profit dropped year-on-year, because the share of loss of jointly-controlled entities has narrowed to $3.79 mln HKD from the year-earlier level.

$0.68 is the recent high and $0.57 is the recent low which 0031 is about to test this support level.

For me, it looks bullish on the chart. A move above $0.61 is a good confirmation for an uptrend move with $0.60 being the key support/stop loss level.

Click here for China Aerospace Intl (0031) daily chart and latest price quote: http://www.aastocks.com/eng/StockQuote/default.asp?symbol=0031

Since 2003, I always received many emails requesting me to write or input some comments on any potential profitable warrants. Well, there are many reasons behind I didn’t do it but since this blog is created, the demand for this is so high again that I think I have to post some good picks on warrant from time to time.

First of all, I have to declare that I am not a good warrant ‘player’. Second, I still thinking that ‘playing’ a warrant is aint much different than gambling.

OK. Warrant for Quality Health (0593) - Quality W0701 (0151). There is no doubt that 0593 is making a good progress in its health-care business. Penta Investment Advisers Ltd added its stakes on August 4, 2006 before 0593 announced its earning. Here is the latest filing details:

But, I am concerned about the volume and turnover of this warrant. So, ‘players’ have to pay attention on this matter.

0151 closed at $1.18 today. Any move above this prive level tomorrow is a good buy and $1.17 being the stop-loss level.

Click here for Quality W0701 (0151) daily chart and latest price quote: http://www.aastocks.com/eng/StockQuote/default.asp?symbol=0151

Can Cheung Kong (0001) leads HSI to higher high? Will Li Ka-Shing sell his stakes on 0001 when a certain price level is reached? When will it happen?

Li Ka-Shing added his stakes on 0001 from June 2005 til May 23, 2006. Here is the latest filing:

Noticeably, on the same time, Templeton Global Advisor decreased its stakes on 0001 while Li Ka-Shing added up his stakes Here is the latest filing, dated April 28, 2006:

By looking on the chart, seems like 0001 is forming a double top since early of September. $87.45 is the highest high for this double top formation.

It is interesting to see if 0001 can move higher while the market still have the momentum to leap higher OR 0001 can be one of the locomotives to lead HSI move higher.

$84.90 is a good price confirmation for uptrend swing while $83.50 is a crucial support level.

Click here for Cheung Kong (0001) daily chart and latest price quote: http://www.aastocks.com/eng/StockQuote/default.asp?symbol=0001

AAC ACOUSTIC (2018) principally engaged in the manufacture and sales of acoustic related products.

Generally, I wont buy or pick a stock that has high P/E ratio. 2018 is a good case for us to investigate and keep our eyes on it on how the show gonna perform, whether it is a good show or a bad…….

Ok. Last checked revealed that 2018’s P/E ratio is about 28x. Not sure if this is an updated figure as 2018 just released its earnings 3weeks ago. Two good points to consider here. First, 2018 released a good earnings report and earnings increased by 107%.  Second and major factor to consider is, JP Morgan increased its stakes on 2018 to about 15% on September 4, which is two days BEFORE the earnings report is released. I not gonna discuss the reasons behind or what are the indication why JP Morgan increased its stakes before the earnings report is released.

Be aware that JP Morgan increased its stakes on Long position as well as the LENDING POOL. Check this out:

On July 26, 2006:

On September 4, 2006:

From the chart, 2018 is sort of making a double top, with $9.49 being the recent high as well as 52-week new high. The stock declined sharply since mid of September and currently testing the support of $8.30.

So, is 2018 a good buy? Personally, I wont buy/pick  a stock that has high P/E ratio. But, 2018 is a good stock for us to study in deep on how the big player gonna performs the show.

2018 closed at $8.59 today. A move above $8.70 on tomorrow is an good indication that this stock has good momentum to move higher. $9.50 is a strong resistance level and $8.30 is the key support level.

Click here for AAC ACOUSTIC (2018) daily chart and latest price quote: http://www.aastocks.com/eng/StockQuote/default.asp?symbol=2018

The principal activities of Emperor Int’l Hldgs 0163 are property development and investment, provision of securities brokerage, margin financing services, consultancy and advisory services and hotel operations.

Last check revealed that the P/E ratio for 163 is only about 3.6. Hmm…. something that worth to investigate about… but, sorry, I am not a CPA or CFA…. My knowledge on this sort of ’thing’ is at so so level only… I am more on technical trader with market sentiment observer….

Penta Investment Advisers Ltd & UBS AG are adding up their stakes on 163 in June this year and since then 163 is rebounded from around $1.50 price level to as high as $1.80. After making that high, the stock is consolidating in between $1.70 to $1.80 level.

$1.70 is the recent low and I believe the market is testing this support level. So, $1.74 is a good entry condition if there is a move into this level and bear in mind that $1.70 is a crucial support level at this moment.

Click here for Emperor Int’l Hldgs daily chart and latest price quote: http://www.aastocks.com/eng/StockQuote/default.asp?symbol=0163

China Water   0855

The results following the shift and realignment of the Group’s business focus is first witnessed in this year’s financial report. The addition of 3 majority owned water supply companies in Jiangxi and the acquisition of a 50% interest in Conseco Seabuckthorn Company Limited, a previously state-owned company, engaged in the Seabuckthorn related business and with the significant downsizing of the remaining electronic businesses at the end of 2005, the Group has completed its business transformation to an integrated water supplier and a provider of sewage treatment services.

Source: China Water (0855) Annual Results Announcement

Again, worth to mention again that companies that are making losses or no earning growth are definitely out of my radar screen, except on very certain strict criterias and conditions.

From the shareholders’ interest disclosure, I noticed that in past 3months, there are 3 funds companies adding up their stakes on this 855, Atlantis Investment Management Ltd, L-R Global Partners, L.P. and Charlemagne Capital (IOM) Limited For and on behalf of Managed Fund.

Well, is this a bullish and good sign for 855? There is nothing can be confirmed until we can forsee the up/down trend for this stock 3months from now.

I believe water business is boiling hot now around the world and this time, the group is really doing something ’serious’ on it main principal business.

855 is already frying high and hot since end of 2005. Can we expect further up move from current price level? Major funds players are adding their position at the average cost around $1.5, yet Deutsche Bank’s cost is only about $0.50.

So, if we are looking for another $0.20 profits from current price level, then it is a good try. If there is a move above $2.05 on Monday, I think it is a good trading opportunity.

Click here for Chine Water daily chart and latest price quote: http://www.aastocks.com/eng/StockQuote/default.asp?symbol=0855