Stock in Focus: ISM COMMUNICATIONS CORPORATION (September 18, 2009)

(This analysis is for September 21 - 25, 2009)

BUSINESS PROFILE

ISM Communications Corporation (ISM), formerly Itogon-Suyoc Mines, Inc., was originally agold-producing Company with mines in the municipalities of Itogon and Suyoc in BenguetProvince. The Itogon Mines, located 23 kilometers southeast of Baguio City, operates a 400MTPD capacity gold mill on straight cyanidation circuit, while Suyoc Mines is situated in themunicipality of Mankayan.ISM was organized as a corporation purely engaged in actual gold production through miningand milling of ores, & bullion marketing. With the amendments of its Articles of Incorporationthe Company also engaged in real estate development, electric power generation and/orengineering and construction activities.However, on June 7, 2002, the Securities and Exchange Commission approved the changein the Company's primary purpose from a mining company to one engaged in the businessof information technology, telecommunications, multi-media and other similar business, andrelegating the original primary purpose to one of the secondary purposes.In this regard , the Company's name was also changed to its present one, ISMCommunications Corporation.

Reference: http://www.pse.com.ph/

Analysis:

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ISM has closed below its Short time moving average.
Short time moving average is currently above mid-time, and above long time moving averages. The relationship between price and moving averages is: neutral in short-term, and bullish in mid-long term.

For the past 10 days the average price range of ISM is 0.0021 and its upward trend strength is 59.33.

ISM has closed above bottom band by 44.4%.
Bollinger Bands are 22.5% narrower than normal.
The current width of the bands (alone) does not suggest anything conclusive about the future volatility or movement of prices.

50 Day Historical Volatility (preferably greater than 40%): 75%

6/100 Historical Volatility (preferably less than 50%): 49%

Support/Resistance:

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Based from Fibonacci retracement, ISM has corrected for about 18%. Its main support line is at 0.0353 and its main resistance line is at 0.0460.

S&R nearest support line is at 0.041 and its nearest resistance line is at 0.043.

Base from the weekly pivot point analysis of ISM.
This are the primary support lines of ISM this week: 0.0413, 0.0377, and 0.0353
While its primary resistance lines for this week are: 0.0473, 0.0497, and 0.0533

Based from this we can assume that a target point to buy some is around 0.041 and 0.0413. But be also careful and watchful when this support line at 0.0413 is broken. This means ISM can go down to as low as 0.0353 for the week.

Buy/Sell:

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ISM momentum for the past 12 days is neutral.

The RSI reading is 51.57 for the past 10 days and is not currently overbought (above 70) or oversold (below 30) range. The last signal was a sell 3 days ago. The RSI and price are not diverging.

Williams %R reading is -71.43 (past 10 days) and its nearing the overbought range (below -80).

Currently the MACD is bearish since it is trading below its signal line.
The MACD crossed below its signal line 11 days ago.
Since the MACD crossed its moving average, ISM's price has increased 2.500%.
And has ranged from a high of 0.046 to a low of 0.039. There have been no divergence signals within the last 5 days.

Recommendation: BUY

This is a buy because it has already significantly corrected for the past days and is nearing its oversold state. But even thou this is a buy just don't forget to always set your stop loss. Be careful and observant always in cases our analysis is wrong. Look for a good opportunity to enter the market. For ISM i think the best time to enter this is when a new higher high candlestick pattern is form. Happy trading and God Bless to all!