No one in Hong Kong will think about the market will bull back because of the QDII which Chinese financial institutes were allowed to invest outside China specially in Hong Kong stock market.

The number tells itself. Is it the show time for big money?

Will it go back to 49.5 in 2 month?

We'll see. 

The company sold nearly 1.5 million ADS at $34.27 each on May 1, 2007 , a zero percent discount to the stock's last traded price. Those institution investors never had a chance to get out.

It closed on 29.47 today, a 14% discount of $34.27. If it would go to $27.5 sometimes later, it's a 20% discount or 27% for $25 per share.

If it would go that far I will be there. It's Jun next week. I would like to take the advantage of the final day of second quarter which mutual fund managers always have to make up the balance sheet.

There're some strange data in Q1 2007 when take a close look. 

-- Total revenues for the quarter increased 65.5 % year-over-year to RMB183.1 million (US$23.7 million).

-- Income from operations was RMB15.9 million (US$2.1 million), an increase of 24.9% year-over-year. Excluding share-based compensation charge, income from operations (non-GAAP) was RMB17.6 million (US$2.3 million), up 34.7% year-over-year.

-- EBITDA (non-GAAP), defined as earnings before interest, taxes, depreciation and amortization, was RMB25.8 million (US$3.3 million), representing a 22.3% increase year-over-year. Excluding foreign exchange losses of RMB6.1 million (US$0.8 million) and share-based compensation expenses of RMB1.7 million (US$0.2 million), EBITDA (non-GAAP) was RMB33.7 million (US$4.4 million), up 56.6% year-over-year.

They made the losses of US$0.8 million and compensation expenses of US$0.2 minllion in Q1 which sould be one time expenses, otherwise the number would go like this: Revenues up 65.5% and net profit up 56.6%.

The first quarter is the worst season for hotel business in China because the whole country almost stop running for at lease 1 month when Chinese go back home town to celebrate the Chinese New Year.

It's a smart strategy to arrange Q1 as worst as possible so that it will "beat the street" easily in the coming quarters and next year.

There's a good chance on NCTY . I hope it will fall more before Q1 announcement on May 21, 2007 at 9:00 PM, US Eastern Time.

NTES is another Chinese gaming company I like. It's cheap for 17.70.

The Mid-May 2007 data as follow. There's a Suspicious 2885 million on May 14. I will keep an eye on it.

HMIN ended the week with a little hammer. I like it. The first target is 35 and 37.5 next.

Home Inns will report its financial results for the first quarter 2007 after the U.S. market closes at 05/21/07 at 9:00 p.m. ET.

NCTY is the most potential moving star but I don't like its oversold status. There's no bargain right now. I mess up.

It will host a conference call and webcast on Monday, May 21, 2007 at 9:00 PM, US Eastern Time (corresponding to Tuesday, May 22, 2007 at 9:00 AM, Beijing Time), to discuss The9's first quarter 2007 unaudited financial results.

SNDA  will host a conference call at 9:00 p.m On May 22 Eastern Time, corresponding with May 23, 2007 at 9:00 a.m. Beijing/Hong Kong time.

NTES seems something wrong but the company buying back its stuck, so I would take it if the price down to 17.5.

BIDU has been announced Q1 2007.

I believe CHINA will have a long run after launching online games later this year but it's not the timing right now.

This picture is an antique building owned by post office in Xiamen China. This old post office will be turn to a hotel operated by HMIN.

HMIN has high volume today. I found some good news on Chinese news websites.

Home Inns & Hotels Management Inc(HMIN), the largest economic hotel chain in China might cooperate with the Chinese post office authority on remodeling some buildings which belong to the post office into hotels.
It will bring a huge amount of high quality hotels to HMIN because post office own many real estate trough out the country specially in major cities. The Chinese Post Office authority also own 30 hotels which available for acquisition.

I guess this is why HMIN sell more ADS shares recently for the first time after public.

The CEO SunJian said that the hotel chain has 208 hotels already which include operating and signed contracts. The number show on 2006 earning report was 134 and 48 under development. He also said that the company will keep a 60% to 70% growing rate year to year.

Reference

孙坚：如家考虑收购邮政酒店

China's Home Inns files to sell 1.5 mln ADSs

The similar selling ADSs activities were happen 2 or 3 times on FMCN. FMCN used those money to acquire several competitors. Will HMIN acquire another hotel chain?

"Beijing Holdings Limited (“Beijing Holdings”), the existing second largest shareholder of the Company, has entered into Shares Sale and Purchase Agreements (the “SPAs”) respectively with China Biotech Holdings Limited (“China Biotech”), ChinaDragon Pacific Limited (“ChinaDragon Pacific”) and China Zhongjing Energy Investment Limited (“Zhongjing Energy”) (the “Purchaser” or collectively the “Purchasers”) in relation to the sale and purchase of 2,009,323 common shares of the Company, of par value US$0.01 each, at US$4.00 per share (“SPA Sale Shares”). "

"ChinaDragon Pacific, a limited liability company established and existing under the laws of the British Virgin Islands, is a wholly owned subsidiary of Guo Kang Pharmaceutical & Medical Supplies Ltd (“Guo Kang”). The sole shareholder of Guo Kang is the Ministry of Health of P. R. China (the “MOH”)."

"In addition, Max Winner will also subscribe for warrants (“Warrants”) to purchase Shares (“Warrant Shares”) in an amount of 1,500,000 Warrant Shares, issuable upon the exercise of the Warrants at an exercise price of US$8.00 per Share from the Company. The subscription premium for the Warrants is US$0.01 per warrant. Upon completion of the transaction, the Company will receive a total cash consideration of US$6,015,000."

I am wondering what's going on. CTDC filed another 6k on Feb 6, 2007 which indicated that "CTDC and Going will enter into an exchangeable note purchase agreement pursuant to which CTDC will subscribe and Going will issue, the Going Note for HK$10 million in cash. CTDC will be entitled to fully convert the Going Note into shares of Huitong Food prior to its proposed initial public offering on the Hong Kong Stock Exchanges. Going and Huitong Food have issued exchangeable notes on similar terms and conditions as the proposed Going Note to CCBI Assets. "

"Founded in 1994, Henan Huitong Meat and Food Company Limited (“Huitong Group”), the predecessor of Huixi, is a major meatpacking manufacturer in China and has become a leading provider of meat products in Hong Kong. Huitong Group ranked No. 27 among top 50 meat producers in China according to a report published by China Meat Industry Association in 2005. Huitong Group’s total amount of sales revenue exceeded US$150 million for the fiscal period ended August 31, 2006. In addition, Huitong Group has established 22 distribution branches and 6 branch offices around China and exported to Russia, Hong Kong and Macau, etc."

Reference:

双汇继续称雄汇通排位上升

构筑资本与实业的完美嫁接

Update(Apr13):

CTDC 200 days Fibonacci:

• 9.45
• 6.34
• 5.38
• 4.42
• 1.31

CTDC is now trading near the lower end of the range:

• 4.42
• 3.23
• 2.87
• 2.50
• 1.31

There're several steps:

1. find a stock via TA
   He use a 17 months "W" reversal chart as a call option candidate.
2. look for a recent lowest price as stop price
3. a strike price that
   • "a little in the money"
   • "two or three months down the road"
   • "beefy volume and open interest"
   • "a bid/ask spread that's not big"

I think it will be more perfect to add rules like this:Find s stock via Morningstar video.

I guess there're many mutual fund managers take a look at this site frequently. It's obvious that sometimes stock prices were moved by the reference video, specially when the stock price were under 50 day  but over 200 day average. The best examples recently were VIMC and JNJ.

I found 3 days which short sell amount were more than 3000 million according to Nov 2006 till Mar 2007 summary.

• 3/5/2007   $3,028,030,000
• 2/28/2007 $4,247,690,000
• 2/8/2007   $4,218,490,000

They're PARTY signals for the bear. I need to look at more former data before having a strong conclusion.

Here it is for the Feb 2007.

This is Jan. I have no idea why the 1/1/2007 was missing.

Dec, 2006

Nov 2006

It seems that whenever the short selling amount Increase more than 50% and the total amount more than 2000 million Hong Kong Dollar, there is a huge drop in the next coming days. The higher the Increasing percentage, the more it fits in.

A most successful options specialist said the winning rule is:

I'd like to begin this kind of losing money paper trade ASAP. 

HMIN has positive volume today. The $38~$46 range have almost  20% profit. Let's see on the next week's mutual fund quarterly report day:).

NCTY is recovering, but doesn't impressive yet. Is it because institutes are changing positions from this one game company to multiple free game platform SNDA?

SNDA got a lot support from US investors recently.

This company's vice president was out from Microsoft. He could tell story the way that US institute investors could understand, so they ignore risk of this company's free gaming policy which was conflict to the Chinese government's game industry regulation that prohibit company make profit from selling virtual assess which is the main income sources of SNDA.

The speculated star CHINA weaken lately, it's getting better now .

FMCN is another example of money flow out long before the huge 2/27 sell-off. What those "big money" knew something we didn't know?

BIDU is NOT google, it's nothing like google, but US investor don't understand. They LOVE this "Chinese google" so much that I bet some might never sell it even it will be pushed back where it should stay.

The most bad thing about BIDU is the company's office issue. I thought it's a totally disaster idea. This company has spent 1 year net income on purchasing the land, so how much it have to put multi year income on building it? Let me guess, 5 year or 10 year?

It will put another year's net income to invest in Japan market which most foreign companies always failed in.

BIDU's price always high comparing to other Chinese stocks because hedge funds like to use it as a short squeeze weapon so no one dare to short it.

Some hedge fund like SAC declared owned no position in BIDU on Dec 2006. Is it the reason why BIDU plunge from the beginning of 2007?

AAPL BIG CBAK CMED CRZO EWS F GROW IGT KRY LONG LVS MA MPEL MS QCOM SUNW UTSI VGZ WYNN

US steel (X) has been moved between $85~$94.95 for more than 1 month. 

It's $440.85 on Mar 16, 2007. The next testing $400 and $354.85 after that.

There's no positive volume showed on the weekly chart yet so there is no reverse signal by now.

The negative move pattern for BIDU seems changed.

It didn't recover quickly like the former 3 times. It broke $99.97 last week so the next support will be $89.38. After that, $78 is the strongest support level.

AAPL still maintains the positive volume trend.

I think it will trade between $86.4 to $93.16 for a while. If the market go down next few weeks, $80 is a very attractive price for the short term.

The positive volume pattern for AAPL seems changed too. The 1~3 positive volume brought higher price movement, the 4~5 got lower price. 1~3 seems like real purchase and 4~5 like Short-squeezed.