KLCI dropped another 15.97 points or about 1% today to close the day at 1,631 level. From its recent sub-wave iii's high of 1,684, KLCI has dropped about 3.1%, which is about the same magnitude of the sub-wave ii's correction of 3%. If the current correction is the sub-wave iv, KLCI is about time to start its sub-wave v.
Since the sub-wave iii's advance is only 7.8%, which is smaller than that of the sub-wave i of 10.2%, I expect wave (iii) to have 9 sub-waves.
Dow moved side way for a week and lost 172 points (-0.57%). If Dow can move higher next week and begin a new round of record breaking, it is possible that the Friday's low of 29,821 is the end of sub-wave ii and sub-wave iii has started.
But if Dow continues to move side way for the next two or three days it is possible that it is forming the mini wave 2 of the sub-wave iii.
FBMKLCI (1,684)
KLCI gained a total of 63 points or 3.9% during the week in the process of forming its sub-wave iii.
Since its sub-wave i gained 10.2%, for a normal 5-wave wave (iii), sub-wave iii should at least be able to gain 10.2% too to 1,720 level. In an extended sub-wave iii, it is possible that it can gain 1.618x10.2% or 16.5% to 1,820 level.
By assuming the magnitude of mega wave (7) to be at least equal to the magnitude of mega wave (5) of about 130%, the minimum target for mega wave (7) is 2,800. It will take about 5 years to complete the mega wave (7).
Dow ended Friday at another new record high. If Dow can break its upper resistance line next week with another new record closing, it will be on its way to complete its sub-wave iii of its wave (iii), which is expected to be dynamic with high volume.
And if Dow is unable to break its upper resistance line next week and starts to move lower instead of higher, most likely it remains on its sub-wave ii consolidation with a abcde-X-abc corrective wave. Sub-wave iii formation will have to wait for a while.
KLCI added 29 points to reach a new high of 1,628 since its 19 March's low of 1,219.
This sub-wave iii of wave (iii) is expected to be more dynamic and broad base in nature with higher than average volume.
Since sub-wave i gained 10.2%, sub-wave iii is expected to gain at least 10.2% to reach 1,720 in a normal 5-wave advance. And wave (iii) is also expected to gain about 29%, same as that for wave (i), to reach at least 1880 level.
Mega wave (1), (3) and (5) gain 286%, 174% and 128% respectively, assuming mega wave (7) can gain around 130%, mega wave (7) is expected to end around 2,800 level.
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Since my last update on KLCI on October 25, KLCI has formed a complex corrective wave (ii) of abc-X-abc and has started the sub-wave i of its wave (iii). If KLCI con continue to move higher next week, we can assume that wave sub-wave iii has started.
But if KLCI were to continue with its side way movement next week, then it is still stuck in its sub-wave ii.
Fintec announced its quarterly earning on Thursday evening after the end of the trading session.
Earning per share is 61.52 sens. Net assets increased from 35 sens to 91 sens a share.
Despite fantastic figures reported, Fintec started today's trading at 11 sens, went to a high of 12 sens and closed the day at 10.5 sens gaining only 1 sen. It shows that investors pay no attention to 'paper gain' unless and until it is realized with solid cash on disposal.
Further checking revealed that the fair value gain was mainly contributed by its holding in Focus Dynamics that has its price increased from 85 sens on 30 June to Rm2.22 on 30 September. The fair value gain for its 517 million (before the 1:3 share split) Focus was Rm708 million. It should be noted that at today's closing price of 65.5 sens ( after the 1:3 share split) for Focus, the fair value lose due to focus at per today is about RM131 million
Looking at Fintec's 10-year chart, since its March's bottom of around 2 sens, it has completed its major wave 1-2.
From the 1-year chart, the 12 sens high recorded this morning is likely to be the end of sub-wave v of wave (i) unless Fintec can move higher next week for a higher sub-wave v.
If Fintec starts to move lower next week, then today's rebound is more likely to be the mini wave 2 of C of major wave 2 that has a potential low of 5 sens. This option is unlikely unless the price of Focus starts to plunge in the next few weeks.
Fintec Global Bhd -ICPS (Rm 0.05)
Fintec-PA, with face value of 8 sens, that will expire on 4/12/2027 has a conversion price of 16 sens before the current on-going Right-Issue. The holders of Fintec-PA are entitled to convert Fintec-PA into Fintec ordinary share by (i) Convert 2xFintec-PA(2x80 sens) to 1xFintec or (ii) Using 1xFintec-PA(80 sens) plus cash of 80 sens for 1xFintec.
With reference to the Circular issued on 9 October related to the current Right-Issue, click 'Circular' for details, on page 58 & 59, the tentative computation showed that the new conversion price after the Right-Issue is about 11 sens, that is 5 sens lower than the original conversion price of 16 sens. Need to wait for an official announcement from the company to confirm the new conversion price of 11 sens. Rightfully the company should officially announce the new conversion price for all ICPS and Warrants on the Ex-entitlement date of the Right-Issue (on 24 November).
Looking at today's closing price of Fintec (10.5 sens) and Fintec-PA (5 sens), I noticed there is a mismatch in price between the two if I assumed that the final new conversion price for Fintec-PA is 11 sens as computed in the 9 October 'Circular'.
Since the face value of Fintec-PA is 8 sens and if the conversion price is 11 sens, I can either (i) exchange 11/8=1.375 shares of Fintec-PA for 1xFintec or (ii) I can use 1xFintec-PA (8 sens) plus cash of 3 sens to get 1xFintec. As per today closing price, when Fintec is at 10.5 sens, rightfully the price of Fintec-PA should be (10.5-3.0)=7.5 sens instead of 5 sens. The difference is 2.5 sens and that is 50% of 5 sens.
I hope my analysis is on the right track, or have I made any mistake? or any wrong interpretation? If I am right, then today's Fintec-PA price of 5 sens is greatly underpriced.
Dow added 783 point or +2.67% within two days and closed above the 30,000 level. With this 2-day's surge after its completion of its 5-wave c of sub-wave ii, Dow has started its sub-wave iii. Currently Dow is on its mini wave 1 of iii.
The mega wave (3) is expected to take another 10 years to complete. Since the mega wave (1) gained 357%, the mega wave (3) is expected to gain at lest 357% in a normal 5-wave formation unless the super wave VII is going for a 9-wave formation then the magnitude of the mega wave (3) can be smaller than that of the mega wave (1).
From the mega wave (2)'s low of 18,213, a 357% gain will bring the mega wave (3) to above 80,000 in 10 years.
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