Market overbought from April? End is nearing

Some good things are happening quietly for healthy market though people might not have noticed.

Some of us were worried that overall market was over bought.

If market end up about minus 0.4 to 0.5 today we might be officially out of the over bought situation :-) Else we will need another day or 2.

Also I hope you noticed shares like JKH is correcting slowly without a major overall crash.
This is matured behavior and so far I like the way market is going.

Next is CTC, NEST , LLUB needs to correct a bit without a crash. LLUB is still getting crossing interest.

But what shares can hold ASI up if CTC, NEST, LLUB corrects? ( Like LLUB NEST CTC did when JKH is correcting. Maybe a role switch? DIAL? ) .

Also want to state one other thing.

Lot of us were badly burnt by bear attacks. But at some point we needto understand ASI will break 7800. When exactly I don;t know but it will happen.

Best to identify fundamentals that did not move much. Also fundamental that moved 40-50% may have more room to move.

I am not talkign short term , but with time and better valuations in the future

Today's price range from high to now, very vast on LLUB & CABO

I agree !! signs of a mature market....not like the mayhem about two years back...

slstock wrote:

If market end up about minus 0.4 to 0.5 today we might be officially out of the over bought situation :-) Else we will need another day or 2.

As above

Market closed -0.42%

Good news is (I believe) we are out techinical overbought market as of today .

This is first time since mid April :-) .
A healthier sign.

Maybe a few more low volume small % red days can help to stabilize market further.

Time to start identifying fundamental shares that did not run .

Within 1 year time , some share that did not run might get attention to appreciate by xx-xxx%.

If you search the forum there are comments made time to time.
Now everyone is talking about ABAN aqnd CFVF.

What are such other shares that did not run?
( I may post later about a share that only ran very little from ASI 4700 and is still undervalued a lot. Please don't send PMs)

I think we need good correction for over valued counters like NEST, JKH, CTC etc.

What valued do you think they should be corrected to ?

econ wrote:I think we need good correction for over valued counters like NEST, JKH, CTC etc.

CTC can go up further ; NEST will not fall below Rs 1900 by looking at how the trasactions are happenning

econ wrote:I think we need good correction for over valued counters like NEST, JKH, CTC etc.

There are a lot of good shares that have appreciated little since ASI below 5000 and still trading at very attractive valuations
to name a few,
RCL
GLAS
VONE
HNB N and X
SAMP
RICH
CIND
NTB etc

slstock wrote:

But what shares can hold ASI up if CTC, NEST, LLUB corrects? ( Like LLUB NEST CTC did when JKH is correcting. Maybe a role switch? DIAL? ) .

A beast called the Buki monster

Plus dont get too positive. June is a big month for the FX market. Amount due to the IMF and oil payment. Plus some regional market outflows

Does one of the US$ bond expire in June as well??

People were worried when ASI was 4800 saying it will drop to 4000.
Then when it went up to 5100 they said it will drop to 3000.
Then 6000 saying it will drop to 4000.
Then 5300 saying it will drop below 4700.
Then at 5800, 6000, and now 6500.

Bottom line is market went from 4700 to 6500 in 1 year. There will be fluctuations and short term drop/corrections but do you expect big drops like in 2012 may/ june?

Bond wrote:[quote=slstock]

But what shares can hold ASI up if CTC, NEST, LLUB corrects? ( Like LLUB NEST CTC did when JKH is correcting. Maybe a role switch? DIAL? ) .

Plus dont get too positive. June is a big month for the FX market. Amount due to the IMF and oil payment. Plus some regional market outflows

Does one of the US$ bond expire in June as well??[/quote]

slstock wrote:What valued do you think they should be corrected to ?

econ wrote:I think we need good correction for over valued counters like NEST, JKH, CTC etc.

They should be corrected to their real values. Currently they are trading unbelievable PBV and PER compare to overall market. Why do they (Foreigners) pay such a heavy premium for these counters? ...

econ wrote:

slstock wrote:What valued do you think they should be corrected to ?

econ wrote:I think we need good correction for over valued counters like NEST, JKH, CTC etc.

They should be corrected to realistic asset prices. Currently they are trading unbelievable PBV and PER.

What is overvalued to some maybe undervalued to others. Perceptions of Value differ.
What may seem unrealistic to one maybe real to another.
What maybe unbelievably expensive ratios for some maybe cheap to another.
Everyone is playing a different game, different time horizons etc.
Above Stocks are mainly bought by (Foreign) Funds for numerous reasons, besides valuations.
They may value Brands, Management excellence, portfolio diversification etc more than we value Assets and Earnings.

We cannot control Mr. Market and tell him - you need to correct yourself, just bcos we think it is for the good and what we need.

The Alchemist wrote:

econ wrote:

slstock wrote:What valued do you think they should be corrected to ?

econ wrote:I think we need good correction for over valued counters like NEST, JKH, CTC etc.

They should be corrected to realistic asset prices. Currently they are trading unbelievable PBV and PER.

What is overvalued to some maybe undervalued to others. Perceptions of Value differ.
What may seem unrealistic to one maybe real to another.
What maybe unbelievably expensive ratios for some maybe cheap to another.
Everyone is playing a different game, different time horizons etc.
Above Stocks are mainly bought by (Foreign) Funds for numerous reasons, besides valuations.
They may value Brands, Management excellence, portfolio diversification etc more than we value Assets and Earnings.

We cannot control Mr. Market and tell him - you need to correct yourself, just bcos we think it is for the good and what we need.

Of course we can not control the market and the players. But we can expect good corrections when counters go in to unrealistic price levels.

econ wrote:
Of course we can not control the market and the players. But we can expect good corrections when counters go in to unrealistic price levels.

see econ, its like this. when you say unrealistic price levels, the line between whats realistic and unrealistic is sometimes not very clear and a bit blurred. lets take JKH for eg. its trading at 18-19 trailing P/E which we may be cheap to some and expensive to others. The price will be determined by demand and supply. If you look at JKH major shareholders, Foreign Funds, Captains, Harry J, Carsons Group etc, they are wiling buyers & sellers, demanding & supplying, at prices & ratios we may not understand, agree or feel is too expensive or cheap. However, because we have our own prejudices on valuations, and that's absolutely fine, we cannot say what is realistic and unrealistic from others point of view.

Not market,JKH,LLUB,NEST and CTC are overbought,problem is do they equal to market?

slstock wrote:

slstock wrote:

If market end up about minus 0.4 to 0.5 today we might be officially out of the over bought situation :-) Else we will need another day or 2.

As above

Market closed -0.42%

Good news is (I believe) we are out techinical overbought market as of today .

This is first time since mid April :-) .
A healthier sign.

Maybe a few more low volume small % red days can help to stabilize market further.

Time to start identifying fundamental shares that did not run .

Within 1 year time , some share that did not run might get attention to appreciate by xx-xxx%.

If you search the forum there are comments made time to time.
Now everyone is talking about ABAN aqnd CFVF.

What are such other shares that did not run?
( I may post later about a share that only ran very little from ASI 4700 and is still undervalued a lot. Please don't send PMs)

CIND is one of them,May be the one you'll mention later.

slstock wrote:


Good news is (I believe) we are out techinical overbought market as of today .

This is first time since mid April :-) .
A healthier sign.

Maybe a few more low volume small % red days can help to stabilize market further.

Market out of overbought for sure today :-)


Now the game is with panic sellers and how long this is going to last.

sahan8896 wrote:

slstock wrote:

slstock wrote:

If market end up about minus 0.4 to 0.5 today we might be officially out of the over bought situation :-) Else we will need another day or 2.

As above

Market closed -0.42%

Good news is (I believe) we are out techinical overbought market as of today .

This is first time since mid April :-) .
A healthier sign.

Maybe a few more low volume small % red days can help to stabilize market further.

Time to start identifying fundamental shares that did not run .

Within 1 year time , some share that did not run might get attention to appreciate by xx-xxx%.

If you search the forum there are comments made time to time.
Now everyone is talking about ABAN aqnd CFVF.

What are such other shares that did not run?
( I may post later about a share that only ran very little from ASI 4700 and is still undervalued a lot. Please don't send PMs)

CIND is one of them,May be the one you'll mention later.

About CIND he mentioned several times in the forum

slstock wrote:People were worried when ASI was 4800 saying it will drop to 4000.
Then when it went up to 5100 they said it will drop to 3000.
Then 6000 saying it will drop to 4000.
Then 5300 saying it will drop below 4700.
Then at 5800, 6000, and now 6500.

Bottom line is market went from 4700 to 6500 in 1 year. There will be fluctuations and short term drop/corrections but do you expect big drops like in 2012 may/ june?

Bond wrote:[quote=slstock]

But what shares can hold ASI up if CTC, NEST, LLUB corrects? ( Like LLUB NEST CTC did when JKH is correcting. Maybe a role switch? DIAL? ) .

Plus dont get too positive. June is a big month for the FX market. Amount due to the IMF and oil payment. Plus some regional market outflows

Does one of the US$ bond expire in June as well??

[/quote]

Some boutique fund managers need to exit their positions. They cannot ride out losses on FX rates.

In the worst case scenario the EPF will absorb this.

Update :

Wonder of CSE.

Market from overbought (for 1.5 months) to Neutral in 2 days!
Things happening very quickly at CSE.


There seem to be "you know who" panic setting after looking at today. 5 counter contributed 2/3 of the drop.

If this keeps up for 2 more days at the same rate it will be over sold. Will give foriegner more chances to collect.

Will I get a outside chance to buy JKH for PE of 16 ?

Best option now is for market to go up on Monday afternoon or Tuesday to reduce this panic . Time will tell. Continous drop will not be good.

I hope market does not drop below ASI 6100 in the worst case. Really there is no reason to unless all the big ones correct and others panic.

Will be good to stabilize around 6200-6300 for a while. some shares to go up and some shares to go down ;-)


If it behaves like the last few days when JKH andLLUB corrected while other countered it , it will be smoother stabilization. .

Amazing how "you know who" like to race. Either upwards or downwards.

What I guest that the counters which has the following qualities.....

1. high amount of foreign holdings.......
2. total dividend per year almost equal to the annual EPS.....
3. if the product are like essential/addicted and/or have less substitutes/competitors.....

for example counters like NEST, CTC, LLUB [what else...??]

has their own ways rather than theories...... corrections... unless the government actions/policies influence them....like taxes or so.. these counters... bit uncontrollable... have their own ways....

* this is how I see....

You have to rememebr shares like LLUB is behavign this way now. Bit for several years it was around rs 160-190.

KDDND wrote:What I guest that the counters which has the following qualities.....

1. high amount of foreign holdings.......
2. total dividend per year almost equal to the annual EPS.....
3. if the product are like essential/addicted and/or have less substitutes/competitors.....

for example counters like NEST, CTC, LLUB [what else...??]

has their own ways rather than theories...... corrections... unless the government actions/policies influence them....like taxes or so.. these counters... bit uncontrollable... have their own ways....

* this is how I see....

Bond wrote:

Some boutique fund managers need to exit their positions. They cannot ride out losses on FX rates.

In the worst case scenario the EPF will absorb this.

What's ur view on LLUB & JKH? U think these are up for a correction..

Imo, the fall is just the tip of the ice-burg..

slstock wrote:You have to rememebr shares like LLUB is behavign this way now. Bit for several years it was around rs 160-190.

KDDND wrote:What I guest that the counters which has the following qualities.....

1. high amount of foreign holdings.......
2. total dividend per year almost equal to the annual EPS.....
3. if the product are like essential/addicted and/or have less substitutes/competitors.....

for example counters like NEST, CTC, LLUB [what else...??]

has their own ways rather than theories...... corrections... unless the government actions/policies influence them....like taxes or so.. these counters... bit uncontrollable... have their own ways....

* this is how I see....

Yes! slstock i agree fully with you......

I remember my broker said about this few months ago when it was 160/-
but by then i was like favoring small counters [i was wrong at this point ... learning process ] not like now..

I too interest these counter now than earlier...

some details of this counter's dividend are.....

DIVIDEND ANNOUNCEMENT - CHEVRON LUBRICANTS LANKA PLC Company ID:- LLUB

2013 total dividend 3/= in only one payments per this year yet
2012 total dividend 11/= in four payments per year
2011 total dividend 9/= in three payments per year
2010 total dividend 12.25/= in four payments per year
2009 total dividend 17.50/= in four payments per year
2008 total dividend 10.50/= in four payments per year

I may be wrong... but my believe and estimation are that this counter could be another NEST & CTC... & thus I have some plan to collect little by little when the current price settle well.......with the aim of considering this counter as good one to consider as retirement plan...... [* don't take this as recommendation do your home work pls....]

I appreciate your point of view slstock! thx