20 Nov 2020
Vivocom: end of day report

Vivocom rebounded from its intraday low of RM1.69 to close at RM1.74, down 9.4% from yesterday.

Active trading puts Vivocom the #6 most actively traded counter in terms of value today.

In fact, Vivocom was top twenty most actively traded counter in terms of value for 9 out of the past 10 trading days, and top ten for 16 out of the past 20 days.

This confirmed my research published on 19 Nov 2020, indicating that interests in Vivocom remains incredibly high and liquidity is plentiful.

With high interests and liquidity comes tight spread, fierce competition and volatility.

Volatility is part and parcel of the game. Like I have previously mentioned: the market is always right.

The market is saying something right now whereby a pattern is emerging from the past 3 weeks of trading in Vivocom’s shares.

Vivocom’s share price goes into slight retracement for every Friday for the past 3 weeks like a clockwork.

First Friday (6 Nov): 30 cents range, down 6.5%

Second Friday (13 Nov): 18 cents range, down 3.2%

Third Friday (20 Nov): 25 cents range, down 9.4%

After each retracement, the stock would rebound strongly and almost faithfully the following week without fail.

Perhaps the same will follow suit next week? We shall see then, won’t we.

I have mentioned this in my earlier afternoon report and I would like to do so again as it’s a most pertinent issue.

Whether Vivocom is another Pump & Dump (P&D) play as rumours swirl widely in the market alleging that it is and that its price is going to be dump soon like any P&D counter.

This has caused investors to rightly be nervous and anxious that the price might actually plummet soon and hence prompted many to sell and lock in their profits.

I beg to differ however. From my close monitoring and analysis on Vivocom's trade velocity and its recent’s announcement of a 3 year moratorium on the new owner’s shares, I’m very bullish about Vivocom’s share price.

The moratorium has essentially remove a big chunk of shares from the supply side. I estimated only 150 to 200 million shares in circulation n actively traded

Only ~150/200 million also not enough shares to meet the huge demand for Vivocom’s shares due to pure momentum trading.

Shares under moratorium how to dump la. The logic doesn’t make sense.

Given time, once the public know that Vivocom is not a P&D stock, it will shoot up like a rocket again.

Investors are new to the concept of self-imposed moratorium as it is unprecedented in KLSE.

Share price is all about demand vs supply. As illustrated in my research paper, we can see the demand for Vivocom’s share is HUGE and we are only in the third week of the rally.

When the supply is scarce and limited while the demand is so huge and overwhelming, the share price will only move in one direction, which is up.

Give Vivocom some time to prove itself to everybody.

Once investors see that Vivocom’s share price won’t collapse due to the limited supply of shares and huge demand for the shares, then they will buy into Vivocom’s shares, engendering the kind of unstoppable momentum that allows it to rocket back to prices at RM2.30, then RM3.00 and RM3.60.

At current price, the upside is more than 100% when the share price goes to RM3.60, while the support level is at RM1.70. The risk vs reward ratio is skewed favourably towards investors' side.