Yes, you got that right! APC Group Inc. (APC), an energy unit of the much favored Belle Corporation (BEL), is indeed poised for a huge upswing in the days to come. APC’s price action, in my opinion, is a technical work of art or a masterpiece to say the least. As you can see from its daily chart, APC’s first notable move was when it broke out from an inverted head and shoulders pattern (highlighted in light blue). After the move, it reached a high of PHP 0.66 before tapering off, developing a cup and handle formation in the process. It then escaped the said cup and handle on September 1, 2010 when it rose by 16% from PHP 0.50 to close at PHP 0.58. It continued to swing higher until it marked a high of PHP 0.89 on October 11, 2010. Since then, APC has cooled off as it trades within a falling wedge. Who would know that this wedge could in fact be a handle of a bigger cup and handle formation?
A falling wedge, as some of you might know, is in fact bullish since it represents only a temporary retracement in prices. Aside from this, APC has already retraced back to the neckline of the smaller cup. This neckline could now act as a support to prevent it from falling and as a spring to push it back up again. With all the three moving averages about to converge, a likely upside swing could occur soon as what happened in its previous moves. A breakout from the falling wedge, which as mentioned could be seen as a handle of a larger cup and handle pattern, could send APC all the way to PHP 1.50. Minor resistances, however, could be met at PHP 0.89 and at its previous peak at PHP 1.28.
Aragorn Power and Energy Corporation (APEC), a unit of Belle Corporation-led APC group, Inc., and Chevron Kalinga, Ltd., a subsidiary of Chevron Geothermal Philippines, Inc., the largest producer of geothermal energy in the world, have joined hands to develop a $300 million geothermal power project in the Kalinga province in Luzon, Philippines. The project involves the development of steam fields within a 26,000 hectare area that can potentially generate about 100 megawatts (MW) of new capacity. At present, the venture is still in the exploratory drilling stage. Any positive developments, therefore, from its preliminary surveys could launch APC to the north. According APC Group EVP and CFO Bernardo Lim, the potential of the fields could even be more than what they first projected.
I also noted earlier that APC Group is a subsidiary of Belle Corporation. These days, the market’s sentiment towards Belle Corporation has been very strong. This optimism towards BEL could spill over to APC as well.