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.
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bullseye. great analysis. Last monday it is boom. just earned a little and hopefully 2nd day ascend today. Great job. more…..ben
Congratulations and thank you! It gapped up but closed low… A failed attempted breakout
hi ron, cup and handles are never reversal patterns but only found as a continuation patterns, they are preceded by an uptrend price action. its easy to mistakenly see them as cup&handles because of the form.
anyway, to make a good strategy base on the pattern you see, i’ll rather trade it as a ‘complex head & shoulder bottom’ (with multiple shoulders), this way i can anticipate the drawdowns/corrections it would make by referring to the left shoulders.
Hi Remmon, they could be as well just like how you’ll see head and shoulders and descending triangles be bullish continuation patterns at times.
” The most famous is the cup and handle formation described in detail by O’Neil (1988) but referred to in many earlier publications. These formations are a variation of the rounding bottom that show a “lip” after the rise from the bottom, and a small congestion area that reverses downward for a short while called a “handle.” The high of the lip establishes, in this type of rounding bottom, the resistance level to watch for an upward breakout. Sometimes the breakout never occurs, and prices keep declining in the handle, continuing to new lows.” -Technical Analysis, Charles D. Kirkpatrick and Julie Dahlquist.
Remmon, you might want to double check your sources. I’ve been trading for almost a decade and I’m pretty sure that I’ve seen quite a lot of them. Good luck!
Hi Ron what’s your current reading on APC? Is it now ready to explode to 1.28-1.50 based on your Jan 16 chart analysis? Current sentiment is on RE stocks (Lopez RE stocks FGEN FPH) and could spill over on APC.
Thanks…
It’s just moving sideways. Sentiment now is towards bluechip companies. Let’s see, though, if APC will make a move too.
Hi Ron, any new analysis on APC and CYBR? Thanks.