FRASER SECURITIES (S) : StatsChipac --technical

StatsChipPac ($1.24) – broadest monthly breakout since Jan 2004 on heavy volumes paves way to reach next price objective of around $1.35-40

The stock has staged significant price breakouts since mid-Nov, which should mark the start of a decisive recovery phase with the first objective at this year’s April-May highs of $1.35-42.

Given the 41% mid-year plunge to 84 cents and the lengthy consolidation around 90 cents to $1.05 since then, this month’s breakout seems overdue and is on solid technical grounds.

Although short term indicators as RSI, momentum and MACD are overbought these are neutralised by similar medium term measures which point to further recovery in the weeks and months ahead.

The swift recovery today to a new 6-month high of $1.26 after yesterday’s pullback to $1.18 from the previous day’s $1.25 high further proves the strong momentum of the current rebound. The 50 and 100 days moving averages have just made a golden cross.

In fact Nov’s volumes are the highest since Jan when the counter started its ascent from the then year’s low of $1.01 to $1.42 in April.

This month, starting off at 97 cents, Stats has already created the widest monthly gain of 29 cents to reach $1.26 today, which has never been recorded since the 32 cent gain in Jan 2004 when it was at much higher levels between $2.12 and $2.45.

Nevertheless the stock has always fallen short the 38.2% mark recovery ($1.45 and $1.48) between this 3 year-high of $2.45 and 2005-06 lows of 88-84 cents, managing modest highs of $1.34 last year and $1.42 in 2006.

Now given the strong recovery momentum which is unlikely to die down in the next several weeks, Stats appears poised to test these highs and once the $1.36-44 area which contains key quarterly resistances since 2001 is taken out, the next level will be $1.61-64. Support is at $1.12-16.

STATS

0034 GMT [Dow Jones] STOCK CALL: UBS upgrades STATS ChipPAC (S24.SG) to Buy from Neutral, target to S$1.60 from S$1.05 as company "is an attractive margin recovery story and we think current restructuring can deliver a doubling in earnings in FY07"; ups FY07 EPS forecast 58% to US$0.071, though advises caution on 4Q06 given weaker 3Q outturn. Notes Carlyle Group bid for ASE but doesn''t view STATS as takeover target "as it does not have the right characteristics to be attractive to a private-equity buyer" - it''s indebted, its margins are below peers, it''s considered high risk business and it only recently started to generate free cash flow. Shares off 4% at S$1.19 yesterday.(JEM)

Happy liao. Bought @ 1.04 in Aug 06, it is really a long wait but worth waiting.

Re-enter CDL

STI recovered after one day drop. CDL looked like a good candidate for recovering. 52WH @ 12.9. Bought @ 12.0 @ opening. Risk/Reward more than 3. Stop loss @ 11.8

Last sold CDL @ 12.3 on 20 Nov 06 after hitting trailing stop. ROC 15.2% in 32 days

Hit 2006 profit target early, one month ahead of year end and that will mean an early start towards meeting 2007 profit target.
ROC in 2006 is 17.6%

Kep Corp

16.0 is the last strong resistance level. Sold Kep @ 17.0. Expecting 17.0 to be also a strong resistance level. Selling at strong resistance level is another good selling strategy. ROC 16.4% in 66 days

Keppel Corp

Wow! finally it breaks 16.2. Let the winner run....Bought @ 14.5. It is able to clear 16.3 probably due to the news on Keppel Bay

Let the winner run its course

Game over for CDL today!. Hit trailing stop @ 12.3 Day low @ 12.3. Day High 12.8 Bought @ 10.6. Yup, let the winner run its course, be disciplined, no question asked and just exit.

ROC 15.2% in 32 days

The journal begins ...

Today, I take the first small step to start this journal, hope that it will be fun after seeing my children blogging. So I am disputing my youngest son that I am not that old fashioned.