Hotung the Venture Capitalist

Hotung is a Taiwanese venture capitalist. Basically, it funds new start ups and take certain percentage share of the start ups. It reaps the profits when the company gets listed. It fell into the black hole(making losses) during the dotcom bubble burst. Fundamentally, the company has posted a profit of NT$364m for FY06 vs a loss of NT$648m in FY05. It has 8 companies on hand targeting to get listed in Nasdaq and other bourses within the year.


I am more interested in the technical analysis of this counter. Personally, I only look at the moving average 20, 50 & 200, the MACD, volume and sometimes the candles. For any counter to be considered, the price must cut the MA20. If MA20 cuts MA50, it a good sign and if MA50 cuts MA200, it is normally one of the sure signs of a uptrend. For this counter, all the above scenarios have came true.

Next, MACD must be positive. It is now positive. The average volume per day is about 1-2 million shares changing hands. Though it is not considered very high volume, my criteria is just 1 million shares per day. So the above criterias have all passed.

I have drawn 2 purple lines, signifying the resistance and support lines. The bottom line is the support, and the top line is the resistance. Right now, the price seems to be consolidating between $0.14-$0.145. Once it is able to break the resistance of $0.155, it should shoot up.

From KELive research, the target is $0.19. If the target is reached, it translates to a 31% returns.