SSI - Sino Strategic International

[grace]

This is my biggest dog of 2007. Not many people on the sellers side now. Should be good for a move...... hope so.

 

[motorway]

This is my biggest dog of 2007. Not many people on the sellers side now. Should be good for a move...... hope so.

A hinge point suggests
an area where one side is finished

The only real volume
was one crossing late reported
So if We put that to one side

We would seem to be definitely at a major juncture

ie

a "hinge"

This is my biggest dog of 2007

The right/wrong stock at the wrong/right time ?

Timing matters
timing is about identifying turning points
about defining positions

for some that may mean only buying all time new highs
for others it means when it has stopped going down
and the "supply" lines are exhausted..


Of interest

http://thechinabusinessnetwork.com/...land-China-Market-For-Legalized-Gambling.html


charts

The numbers correspond to sale milestones ( where the blue arrows on the 1 box chart are )
there is a change in the behavior in relation to them

Yes it moves but differently

Considerable light is thrown on the technical strength or weakness of the market and special stocks by their action in the face of important news

dyor
be a lone wolf in YOUR decision making

tip sheets, broker reports, company releases... forum posts
are not what matters

The size of the automatic rally
has a special indication I think
as regards the "supply lines" of the bears

oversold ? over extended ?
We will see for sure when (if )
the bulls launch a counter attack..

trends are sustained by rotation
buyers have to become sellers or sellers have to become buyers
trends require energy..

Question
could SSI be a superstock ?

see Superstocks by Kenneth L Fisher ..

esp get rich with the glitch........

look at the speed and spacing of the postings to the chart in relation to the weekly sales .
look at the the large correction to the initial move up to the highs.
decide for yourself what is the action right now





motorway

 

[grace]

Motorway, I am not so educated as you on TA, but I do see some resistance forming at about $1. Fundamentally, they have first mover advantage of being in China before others. They need to quickly move on cities other than Shanghai now that they have the 2 year period of operation required for this per Chinese regulations. This will cost but I do hope they get moving on this as a priority. Hopefully, the sp has hit bottem.......

 

[motorway]

Grace

from the AGM

Since we already have over 2 years
of trading track record and a large number of outlets established, we now qualify for a
licence to franchise our operations throughout China. This is one option that would enable
us to fast track our business model into other provinces and cities while minimizing capital
requirements.

With the TA

shares are a finite quantity.. They are subject to the law of demand and supply.......when supply is overcoming demand prices go down, as they go down there is a change of ownership...

To keep going down those who bought have to in turn become sellers..

You can only sell shares you have ( forget short selling it does not apply here )...So who is holding becomes important...that is strong or weak hands..

The 3 box reversal chart shows a typical gold rush and then adjustment

maybe sales did not kick in as fast as some would have liked
maybe there was concern with where the funding for expansion was to come from...maybe the falling sharprice fed on itself

This is all speculation that gets us nowhere

On the 3 box chart look at how tight the recent bottoms have become
and how ordered the formations

There was NO follow through to the downside anymore ( the last two horizontal lines ) But there was a good move up on the first bounce ( I call it a precursor because of where it has occurred... a move that is only ahead in terms of time not price)

It is good to know all the fundamental story
it is good context

But the fundamentals that matter are always of tomorrow .
What is the real outlook for the next 6 mths ?

The next 6 mths seems to have a large bearing on markets and stocks

hence the importance of the charts

eg "would enable
us to fast track our business model into other provinces and cities while minimizing capital
requirements."

Is this true ?

If it is as good as it sounds
then demand will be seen to start to overcome supply
We will see this first
in the lack of downside follow through
in the appearance of clear support
in some tightness and order
and in some precursor movement

shares finite held by strong or weak hands
creates the technical position that
news will build on

news is always old news
in the sense that decisions with consequences have already been taken

eg the expansion might not need much capital funding


There is a line up of interests here...
Creating a legal industry and crowding out the illegal

huge potential no doubt..

articles like in the bulletin
tend to only bring in weak hands

You point to the lack of sellers in the depth

once it is obvious that there is a goldmine
at what price will there be sellers ?

( everyone will be a strong hand )

That is why looking to go long
I am looking at the down moves
that is where the "springboard" IS

look at the chart
can you not see the bounces off support ?


BUT

that is only now... No reward without risk

so maybe the springboard breaks

As soon as the next sales are announced I will update the chart
and We will see the trend..the 1 2 3 are millions Rmb....

It took very little effort ( volume ) to produce the column I am calling a precursor.............little effort produced a pleasing result . And on the way back there was no downside follow through

and it is now at a hinge

again DYOR

motorway

 

[juw177]

Volume for this stock has been low and no large buyers are stepping up to absorb the weak hands that are trying to exit. Those hands are holders that have been waiting for a turn around and increase in liquidity.

Any other comments on the price? Motorway, is it a good idea to set a time stop in these situations?

 

[motorway]

Mkt Dynamics are such that a lot of stocks like this are on the sidelines

So these stocks are being allowed to sag.... and in many cases the time horizon of the sellers and buyers are even further apart than normal

eg the sellers wants to sell NOW
but the buyer wants to buy sometime
but only at a good price

Volume has been very low ( in that context a good sign ? )
There has been some ( maybe just a very few ) buyers

who maybe put a bid for 5000 shares with large spread between bid offer
then move it down further etc..

There is a bid for 20,000 shares at .74 atm ( and it was just 510 shares I think that took it down to .75 after one of those bids ( 5000 ) was taken at .82 ).....

So it depends on your time horizon

half yearly soon

In the XAO thread I mentioned
to expect delayed endings ( esp with stocks like this )

We had signs of ending action
now that is delayed ( no guarantee though )

charts are interesting ( delayed ending on the P&F which has practically stopped ( what does that say about risk etc )

there was a indication earlier
and a retest of this .75 area now

( with the 20,000 bid appeared )

motorway

I will post some charts later
and I have some more thoughts....

 

[rub92me]

Volume has been very low ( in that context a good sign ? )
There has been some ( maybe just a very few ) buyers
who maybe put a bid for 5000 shares with large spread between bid offer
then move it down further etc.

Don't tell anyone, but I've been one of those the last 4 weeks. Have to be very patient though not to rock the boat too much. I have a 2-3 year horizon on this. Will be watching closely whether they hit their targets though.

 

[juw177]

Funny how the action happened right after my post. Big change in market depth today after the release of the demerger plans.

There was a (little) bit of buying interest in GCN after the ann too, which has also been in a strong downtrend. Although I admit I don't know too much about the fundamentals of the 2 entities, SSI is stronger technically so I am predicting SSI SP will benefit from the demerger.

 

[grace]

Don't tell anyone, but I've been one of those the last 4 weeks. Have to be very patient though not to rock the boat too much. I have a 2-3 year horizon on this. Will be watching closely whether they hit their targets though.

Was really getting frustrated with this one and I nearlly sold it yesterday - could have been to you. This is my dog of 2007. Perhaps will not be my dog of 08 one hopes. The Chinese love to gamble, we just need them to do it legally!

 

[motorway]

we just need them to do it legally

That's what SSI wants

and importantly that's what the Chinese Government appears to want as well...

Qtrly did not give much update

( setting the stage for the half yearly ? )

but did confirm intention to be moving to profit calendar 2008
and did say something about fixed odds sports betting launch in Shanghai
in April...

Half year should reveal more..

This "demerger" is free shares to SSI holders it would seem..

But the why might be more important

setting the stage for ? ( just thinking out loud.. There is listing on another exchange still to be confirmed etc )

always DYOR...

Was really getting frustrated with this one and I nearlly sold it yesterday

Accumulation phases are boring and scary ( to the impatient and the noise trader ( weak hand )
and a delayed ending
is what it sounds
"Market Conditions"
have kept any new buying on the sidelines ( new blood that would look ahead)
and has allowed a another chance for "passive sponsorship" to bore and scare and bore again... ( IF so there are not many left to bore or scare ? )



in the XAO thread I said Time eats things...

I have a 2-3 year horizon on this

I think 6 months maybe really 6 weeks is long term at the moment

A market like this shortens time horizons
by doing so it creates opportunity

OF COURSE only if there is opportunity


and only if there IS accumulation

maybe all depends on how smart rub92me is

just observations and opinion

motorway

 

[motorway]

What a delayed ending is should be be clear from the charts...

Why are we below the second last blue line ?

I would say the fall in the general mkt...


there was No sell off in SSI
but demand did retreat


and the few sellers have had to come down to meet them

so supply and demand curves both shifted down ( there is very little oscillation ! )

Volume is low because ( so far ) supply is low.. low selling presure


There is a build up of congestion on the P&F

"cause"

motorway

 

[motorway]

Why are we below the second last blue line ?

I would say the fall in the general mkt...

so let's remove the that factor and look at a

Comparative Chart !


So that IS how it appears....

I mentioned some indications
Chartcraft P&F have their own definition of a Selling Climax

It is a weekly key reversal ( so a lower low for the week But a Higher close )
occurring at 52 week lows.... There have been two of those recently..

But what is missing ? and still is missing ? The Volume !

The relative chart is STRONGER than the Stock chart...

The relative price (can) give a more realistic description of how a
stock moves. It may reveal, for example, that a stock’s poor
performance is not so poor after all

When the stock price decreases faster than the relative price we have an under-valued situation and most likely pent-up demand

An undervalued situation can be viewed as action or reaction, depending on whether it initiates a deviation , or follows a deviation .

ie: This stock has been in a two year down trend...
So does the recent "stronger performance"
represent new action or a reaction ( and that down trend continues )

Some Volume would reveal ( where the volume comes in )

But We do have the flow of the chart
that "mid pattern rally"
and the current lack of supply

Will be watching closely whether they hit their targets though.

and the expansion plans
and the listing plans
etc

and mkt action that might suggest the next 6 mths hold promise ..


motorway

 

[grace]

1/2 yearly out today. Whilst revenue was up, exchange rate hit that hard.

One thing that was mentioned was that sports betting alone, commencing in April 08 has the potential of exceeding all other gambling products combined. This will be the first legalised sports betting in China. Further expansion also mentioned into other parts of China.

Based on fundamentals, I'm not going to sell.

 

[grace]

Also interesting valuation compared to Market Cap of $46 million! (per the ASX release today page 2)

Impairment testing/Independent Valuation of gaming assets

Impairment testing is performed annually for goodwill and intangible assets.

This year BDO Kendalls Corporate Finance (?BDO?), a division of BDO Kendalls, one of Australia's largest professional accounting and advisory practices, carried out an independent valuation of the equity and intangible assets of China Entertainment Holdings Limited (?CEH?) acquired by SSI in November 2005 (essentially the gaming rights of the Company at that time).
These gaming rights, which have a carrying value of $68.8m in the Balance Sheet, were valued at between $66.9m and $77.2m by BDO.

As there have been many enhancements to the gaming business since purchase, BDO also conducted an independent valuation of all of the Company?s gaming rights in addition to the rights included in the
Balance Sheet (including Welfare Lotto and Keno, Sports Lotto and Sports Betting but excluding VLT) and arrived at a value of between $788m and $905m, equivalent to approximately A$11.02 and A$12.65 per SSI share fully diluted.

This represents a substantial premium over and above the total current market capitalisation of SSI and demonstrates the significant mismatch between the Company?s fundamental enterprise value relative to the current market price of SSI shares.

 

[motorway]

http://www.theaustralian.news.com.au/story/0,25197,23258858-5001942,00.html

While virtually all of the globe's share markets have been in sell-off mode since August last year, when the reality of the US sub-prime crisis -- and its global ramifications -- became too stark to ignore, the Asian markets have suffered the most.

As the accompanying chart shows, emerging-markets investors -- by definition, among the most risk-comfortable investors of all -- have dropped Asia like a hot BRIC.

As State Street Global Markets Research puts it, fund flows into emerging Asia "hobble from feeble to pathetic". In fact, the funds flow has fallen to nil. While there has been sustained buying of emerging European stock markets, so far in 2008, emerging-markets investors have switched the destination of their investments from Asia to South America. But the flows will return, say local Asian investors, because Asia has a better fundamental story than the other regions.

SSI is a micro cap and a China Story stock ( even if it is listed on the ASX )

But the flows will return

So how is it travelling ?

The first pattern marked on this chart
followed the spike up ( That retraced back )

How do you get such a pattern ?

( I would refer anyone interested to the PPT presentation In the Wyckoff Method thread )

It is a dampened oscillation -----------> supply is rotating away from demand. Why ? probably an expectation that prices will rise based on the prior spike and the anticipation of a support level...

But prices only go up if there is demand... and If you look at the months marked and at the excerpt above , maybe we can see why Demand did not respond

supply waiting for demand was a test.
demand shifting down was a response...

TEST -> RESPONSE

OK The second pattern marked is an expanding oscillation

Demand rotated up ( we saw that also in the mkt depth

Funny how the action happened right after my post. Big change in market depth today after the release of the demerger plans.

)
The response was a lot of supply ( relative ) seeming relieved to find buyers of quantity.

Now.... That extra supply (

no large buyers are stepping up to absorb the weak hands that are trying to exit. Those hands are holders that have been waiting for a turn around and increase in liquidity.

( Good insights by juw177 )

was a very important test.

It could have overcome the demand . Or demand could absorb it and start to overcome the supply...
( demand shifting up )...

This is what has happened ( so far )

We also had a very good test when

Tim Boreham ... Gave his judgement that there was no compelling reason to invest in "this direct boat to China" .

That should have given the "weak hands " a good shake
and maybe puts a good light ( in context ) on the buyers..

It is almost like that
99.9% of the time mkt participants Under react
and
0.01% of the time they massively overreact..

People just follow along..

I said

Some Volume would reveal ( where the volume comes in )

Well I want to see more..

And some urgency.. ( SSI can not be oversold unless the volume and/or price response reveals it to be so )

That said I still am of the opinion that there has been accumulation occurring
from significantly higher prices ( refer to the thread )

Yes The valuation and the prospects appear to be the goods





motorway

 

[motorway]

That said I still am of the opinion that there has been accumulation occurring
from significantly higher prices ( refer to the thread )

Yes The valuation and the prospects appear to be the goods

Welcome to the "joys" of passive sponsorship
in the roller coaster that is the mkt ( what mkt ! ) atm..

Broken companies and/or Broken Shareholders

Only need one to make for a wild ride..

http://www.theaustralian.news.com.au/story/0,25197,23375372-5001942,00.html

Small-cap fund managers watched in horror as even their soundest businesses took 20-30 per cent hits on the market, gapping (falling very sharply with no trades occurring at the price points in between) all over the place.

" The market was down 14 per cent, but there was catastrophic gapping in some of the small-cap stocks.

"That simply tells you that you're dealing in small caps, where the liquidity might not be there in an extreme market situation.

"Just as people no longer take liquidity for granted when they talk about interest-rate securities, the same is true for small caps.

"The fact is that the small caps are often less diversified or are single-product businesses."

Nigel Douglas, head of research at van Eyk, says small-cap stocks are "unavoidably high-beta" (that is, show a high correlation to the movement of the market index).
---
"Small-caps tend to rise faster and fall faster than large-caps, but when the market sells off, there tends to be a flight to low-beta stocks.
-------
"That's before you even look at the stock-specific factors that hit a number of the small-caps very hard."

-----------
In vain the managers complained that the initial market selling was indiscriminate, and that good-quality stocks were hit hardest, as market participants searched for liquidity.

----------
"People are trying to exit the market, the large caps get sold off first, because they're more liquid, and then the better-quality small caps get sold off because they have the liquidity.
-----------
"In the last three months we've seen this effect in a number of asset classes.
-------------
"In this kind of situation the small caps can suffer a longer-running effect, but there are a number of factors that should enable the better-quality small caps to rebound.

Some snatches from the article..

SSI is not even a small cap

Sort of a micro micro cap ...


Market depth returned today

DYOR ( always )




The long tail down is a possible sign
of a very oversold condition

reversal with volume
would tend to confirm
no reversal ( and no volume )
Then it is not oversold

Some Volume would reveal ( where the volume comes in )

motorway

 

[motorway]

Welcome to the "joys" of passive sponsorship
in the roller coaster that is the mkt ( what mkt ! ) atm..

Broken companies and/or Broken Shareholders
Only need one to make for a wild ride..

Opes Prime ?

As far as I know

China still exists

The long tail down is a possible sign
of a very oversold condition

reversal with volume
would tend to confirm

A triple delayed ending ?????

( what mkt ! )

Bit of a market visible now...........

And what are markets for ?

Transfer of Ownership
Strong and Weak hands
Risk for Reward

I think the market action has given good lessons
about weak hands and what they are ...

About Risk and Reward...
about transfer..


Discussion
DYOR
motorway

 

[grace]

Motoway, do you actually own any of these?

I only just found all of your posting on another thread in relation to the overall market........

Soccor and basketball betting starts this month with Sino....

Any sign of a turnaround coming in the near future?

 

[motorway]

Motoway, do you actually own any of these?

I only just found all of your posting on another thread in relation to the overall market........

Soccor and basketball betting starts this month with Sino....

Any sign of a turnaround coming in the near future?

Yes.....And have been buying and trying to buy..

There has been a lot selling driving this down
But what is sold can not be sold again
By the same person in the same circumstances

We can not separate the position of the market from individuals stocks.

What looks like a broken stock.. Can just be in fact broken shareholders


In the mean time... The fundamentals that will matter unfold and become known ( Not what has been , but what will be )...

We are seeing just how much
The market is about following
and at times like this following can be a series of forced moves

But eventually demand and supply meet .
Those underwater stop holding their breath
others calm down and realize they will be able to, until
they are back above water

They realize that ,that time will come.

Yes SSI is to launch sports betting
and continues to move to profitability (dyor )

( DYOR !)...............I have even been buying a few GCN ( check out their announcements .

THE FUNDAMENTALS of SSI have never changed as far as I can see

52 week highs and lows never can be explained much by Fundamentals..
certainly not by the fundamentals that will matter..

Any sign of a turnaround coming in the near future?

I would say Absolutely...We have had significant selling..

It is difficult to over-emphasize the importance of studying the technical position, particularly when making a speculative commitment. Many people may say, What is a weak or a strong technical position? My reply is, in brief, that a stock is in a weak technical position on the bull side when it has been purchased and is held by a large number of outside speculators; when most of these are looking for a profit; when the price of the stock has advanced to a point where no further buying can be stimulated for the time being. It stands to reason that when buying power is exhausted a stock must decline, no matter how strong its finances, management or earning power.

On the other hand

Absolutely is My judgement for My purpose

DYOR.......A delayed ending is still an ending ( actually potentially a more powerful one )

You know what SSI's expectations are for sports betting ?
and supposed to launch this month !

motorway

 

[nomore4s]

Quick question regarding the record date for the GCN dist.

Do shares purchased on the record date (27.03.08) entitle you to the GCN shares or did you need to purchase on the 26.03.08? This always confuses me for some reason

GCN will be demerged from SSI with SSI’s 51% shareholding in GCN to be distributed “in specie” on a pro rata basis to SSI shareholders. Based on the existing issued capital of SSI, each 1 share in SSI held as at the record date of 27 March 2008 will be entitled to a distribution of approximately 3.2 shares in GCN.