Technical Analysis of ICB on 13 Jan 2017

Technical Analysis of ICB on 13 Jan 2017

This is no buy/sell recommendation - just a trial to see if Technical Analysis (works to an extent) in Dhaka Stock Exchange.

Although quite a number of shares are showing weakness in structure, the Index is not yielding. It is unleashing weapons after weapons from its armory to keep moving higher. It even has a few trump cards up its sleeves as in large caps (including a few MNCs).

It is becoming risky to open new positions. But as I mentioned in my previous article, I will try to develop a scenario for ICB. http://imti77az.blogspot.com/2017/01/market-has-gone-berserk.html

Fundamental Analysis: Its profits and EPS look OK. It has consistently given Cash Dividends, which I like – although the Dividend is declining probably due to declining EPS.

From DSE	2013	2014	2015	2016
Profit	3,764	3,606	4,394	3,316
EPS	8.92	8.54	7.66	5.24
Dividend	40% C	45%C	35%C	30%C
NOCFPS			16	43

PE is very high at 40 – does not seem to be a stock for Fundamental Analysts.

So now let us look at the Technicals: I am a bit late with the analysis. It woke up from a long slumber and started running from 100 to 160+ in 14 trading days!

More than 50% return for those who patiently waited with it for so many days. Just reward I would say for the patient investors.

It has also crossed an almost two year high around 145 to 149. Now, if it can stay above 140, there could be significant up potential.

I am assuming that its initial run was over yesterday around 166. Now, if it retraces to around 140 (on low volume) and then makes an up move, we could see a big bullish run in ICB.

*(Note: TA is not a Science; it works 60-70% of the time so don’t be hooked on to the exact numbers – please allow some flexibility).

Stop loss would be 130 assuming buy around 140 – it is for the risk takers.

Let us see what unfolds . . .