VBA
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     holycow
Member
Username: holycow
Post Number: 3626
Registered: 08-2004
Rating: N/A
Votes: 0
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| | Thursday, December 20, 2007 - 08:34 am: |  
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VBA/QAN Weekly
1) note the above are weekly charts for VBA and QAN.
2) VBA is in trouble, probably due to competition from both Tiger Air and Jetstar. I didn't check any fundamentals so I may be wrong on VBA's operation. But based on chart, it is saying this is at least what the market is seeing - "VBA is facing tough competition and its profitability is in doubt".
The high fuel cost is another concern for most airlines, I guess VBA is no exception.
3) Referring to the charts, as shown by point 1, both airlines were "in sync", as perceived by the markets as "equally profitable". Fast forward to point 2, their fortunes began to diverge - QAN was in takeover play while VBA had suffered profit taking. That was the best time to take profit in VBA (in hindsight).
Also, the recent profit upgrade announced by QAN is putting more pressure on VBA - there must be something wrong with its operation (I would be assuming this at least!).
4) Indicator wise - the TMF is in decline, quite distinctive if you were to compare that with QAN (which is rising). Momentum wise, both RSI are getting weaker. (For those who hold QAN, note the weekly RSI divergence - I would take at least half my profit at this point).
5) What to do next? Frankly this is the hardest question to tackle. The best approach is always - "prevention is better than cure" - don't let your stock get to this late stage of correction. It is much easier to be decisive when the sp has just gone into decline.
So at this stage, hope reigns - let's hope the fibo 61.8% would hold and hopefully somewhere near 1.95, the old support would halt the decline. Should both levels fail I guess it's up to individual to decide if cutting loss is a good idea. From my lesson learned in BOL, I think it is.
HC
... one day...!
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