|
LAO LSX: Prices gain but volumes wane
The price resistance barrier dried up the volumes on Wednesday and Thursday as indicated by today's charts. Friday's first 5 sessions were no different except for a small index gain of 13.23 points thanks to a small share price gain as forecasted of a 200 kip gain by BCEL (6,200kip) and a 50 kip share price improvement to EDL-Gen (4,450 kip).
For the average new (novice) investor there is a danger to read too much into every day's result. It's much better to take a longer term perspective which is a better guide. Sure BCEL has fallen, but on such low volumes it is to be regarded as a false leading indicator (volumes are very low and not indicative of the majority of shareholders).
All the news about BCEL is good as too with EDL-Gen. EDL-Gen has in the past 30 days bypassed the “head and shoulders” pattern twice, with the indicators firmly to the upside. EDL-Gen volumes have been 70-75 percent higher than BCEL.
Announcements this week from BCEL and particularly about EDL-Gen's increased dividends and increased profits are very positive indicators that investors can become “bullish” for the power generation stock as indicated by the volumes bars including the seller price resistance bars of recent days.
Based on fundamentals (research), talk to your broker who would have both BCEL and EDL-Gen's “intrinsic price” value well above this month's trading price. However, the current trades do not factor that in. Instead they're profit taking to a cash position – not a desirable option for the smaller investor due to the need to factor in brokerage costs.
vientiane times
|
