Risk appetite sided on infrastructure plays like Holcim Philippines, Inc. or HLCM in the Philippine stock market on expectations that the Philippine national government will speed up its infrastructure projects. HLCM, being one of the major listed supplier of cement in the country, benefited from this as reflected in the 5.32% gain in its share prices today (January 2, 2012).
As can be seen in its chart above, HLCM has been consolidating in what appears to be a rounding bottom chart pattern as for my technical analysis. Today, it attempted to move above PHP 10.00. Some selling pressure, however, was met when it hit a resistance at its former lows and at its downtrend line. Given this, HLCM could first step down and correct before gathering enough momentum to eventually move above PHP 10.00. HLCM’s formation then could shift from a rounding bottom into possibly a cup and handle. Either way, a breach of the said resistance could send it at least towards PHP 12.00 (gauged by projecting the height of the pattern from the point of possible breakout). Such could potentially give one a handsome 20% return in the short run.