Jollibee Foods Corporation (JFC) closed with a red candlestick for four trading days in a row. The price closed at ₱139.50, down by 0.50 percent, as of August 20, 2020. JFC printed a total turnover value of ₱196.50 million with foreign investors as the main drivers of today’s price action.
Even though the foreign investors registered a Net Foreign Buying worth nearly ₱6.70 million, that didn’t help reverse the bearishness of today’s red volume bar higher than the 100 percent of Jollibee’s 10-day volume average. Foreign investors are net sellers year-to-date.
Without significant support from the foreign investors, in terms of foreign buying, Jollibee is more likely to dilly-dally between the immediate support and resistance at ₱126.20 and ₱151.80, respectively.
The MACD line is still moving above the signal line. However, I already see the formation of a bearish convergence between the two lines. I see the same between the +DMI and -DMI. Furthermore, the last price already broke below the 10-day SMA. These three events are bearish signals.
If anything is consoling here, it’s the low-risk level of JFC due to its historical volatility score of 29.35 percent. Take note that having a low-risk level doesn’t automatically make the stock a good buy.
Trade-Volume Distribution Analysis
Last Price: ₱139.50
Dominant Range: ₱139.50 – ₱139.50
Do you want more bearish signals? I’ll show them to you.
The last price is lower than the volume-weighted average price of Jollibee. That’s a bearish signal.
The dominant price of ₱139.50 is not only closer to the intraday low than the intraday high, but it’s also the intraday low itself.
Just in case JFC makes a bullish start within the first 30 minutes of the next trading day, watch out for the range between ₱140.00 and ₱140.50. That’s the next dominant range I see on today’s price-volume distribution chart.
True Market Sentiment – EOD (August 20, 2020)
True Market Sentiment: BULLISH
7 of the top 10 brokers registered a positive Net Amount
6 of the top 10 brokers registered a higher Buying Average than Selling Average
Top 10 Players’ Buying Average: ₱139.9798
Top 10 Players’ Selling Average: ₱139.9328
10 out of 43 participants or 23.26% of all participants registered a 100% BUYING activity
12 out of 43 participants or 27.91% of all participants registered a 100% SELLING activity
True Market Sentiment – WTD (August 17-20, 2020)
True Market Sentiment: BULLISH
6 of the top 10 brokers registered a positive Net Amount
7 of the top 10 brokers registered a higher Buying Average than Selling Average
Top 10 Players’ Buying Average: ₱140.7703
Top 10 Players’ Selling Average: ₱140.5204
12 out of 63 participants or 19.05% of all participants registered a 100% BUYING activity
7 out of 63 participants or 11.11% of all participants registered a 100% SELLING activity
True Market Sentiment – MTD (August 3-20, 2020)
True Market Sentiment: BEARISH
5 of the top 10 brokers registered a positive Net Amount
3 of the top 10 brokers registered a higher Buying Average than Selling Average
Top 10 Players’ Buying Average: ₱136.9811
Top 10 Players’ Selling Average: ₱136.9651
4 out of 96 participants or 4.17% of all participants registered a 100% BUYING activity
17 out of 96 participants or 17.71% of all participants registered a 100% SELLING activity
While I see signs of consolidation in the EOD and WTD True Market Sentiment charts of Jollibee, the MTD chart chose to differ. Due to the lack of a strong positive catalyst for JFC, I’d put my bias to the bearish True Market Sentiment in the MTD chart. I’d like to have a more conservative stance based on this data.
If you have Jollibee in your portfolio, what do you think I will recommend?
Your guess is as good as mine. Hold your position if your trailing stop is intact. If you’re a low-risk investor, you can reduce the percentage of risk on your trailing stop. Feel free to use my trailing stop calculator in the TOOLS tab of our online stock market library.
Don’t average down yet, so you don’t waste your buying power. At this point, it’s more likely for JFC to re-test the support at ₱126.20.
On the other hand, what should you do if you don’t have JFC yet?
Be on a wait-and-see mode. Continue monitoring JFC in your watchlist if you like, but don’t add it to your stock portfolio. There are no confirmed buy signals. My 10SMACD and Momentum Power Indicator are both bearish.
Once the 10SMACD and Momentum Power Indicator of JFC become bullish, you need to calculate your reward-to-risk ratio. Do a test-buy within the prevailing dominant range if you’re satisfied with your reward-to-risk ratio. You can use my reward-to-risk ratio calculator in the TOOLS tab of our online stock market library.
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