One Helluva Close

My initial reaction to this morning's forced closings was: WHAT WAS THAT? See, the market opened slightly higher, around 9 points. We slowly drifted lower until we were down around 20 points. A few minutes before the close, the market started to rally. That seemed normal enough. Next thing I knew, the market closed 31 points higher. 

Now, that is artificial. 

For some reason, foreign funds hijacked prices at the close (special thanks to JP Morgan and DBP Daiwa). The most spectacular move was from ALI, which jumped a little over 1 peso. MBT was also pushed higher by 1 peso, to close the day at 70. EDC jumped 6 cents from 5.02 to 5.08. They also even tried to close SM at 500 pesos! Too bad the sellers matched the 62K buying, most of which belonged to Daiwa. I was actually hoping I'd be done at 500. :-P There were others that were pushed higher by the close but they are too many to mention.

Before the excitement by the close, the there were actually only two stocks worth mentioning: APC and AT. BEL and SINO were slightly influenced by APC's move but the real play was in APC. Congrats, APC and AT shareholders!

I refrained myself from buying anything today. I bought back some of my GMAP but aside from that, I didn't buy anything. For some reason, I'm not comfortable to buy anything. There has not been much of a correction yet. I was chatting with a friend of mine and told him exactly that. He asked me, what if there won't be any correction? In that case, I will look for bull flags for entry. But somehow, I am not convinced that there won't be a correction.

I read an article that said that said that the Philippine market's rally will be a massive one. There is another article that said that the Philippine and Malaysian markets will be entering a "golden era". That may be true in a bigger picture but if you look at it in the short-term, yesterday ought to have been the short-term peak but the forced closings today blurred the technical picture a bit. Thanks to the forced closings, I'm betting that the market will be down tomorrow since most of the prices that were forced closed will return to their normal price. 

Anyway, I sidetracked a little. My point is, although I agree with those articles, I am aware that the time frame of that bullish outlook is of the long term. My guess is, that bullishness will be misused for the short-term. People will become complacent. A correction would ensue and it will trigger a deeper correction than most people anticipated. People will start to fear and sell while they still can. Then the market will rally stronger than it did previously. That's just a hunch. But let's also see if the opposite scenario occurs: the market holds on to its gains and accelerates to the upside. A lot of our traders seem bearish in the short-term. It seems we are just waiting for prices to go lower to buy. If that is the psychology of the market, if prices don't correct soon, we might actually be the ones to fuel a sharper uptrend.

It's a long list of possibilities... I guess, we'll see! :)