China Life Insurance Company Limited (2628.HK) Is A Solid Bet
The gradual evaporation of fears over COVID-19 will eventually help China Life Insurance regain what it lost before this pandemic came around.
China Life Insurance
Ticker: 2628:HK
Price: HKD 15.90
China Life Insurance Company Limited is a life insurance company. The Company provides a range of insurance products, including individual and group life insurance, health insurance and accident insurance products.
It operates through three segments: Life Insurance, Health Insurance, and Accident Insurance.
Its Life Insurance segment provides participating and non-participating life insurance and annuities to individuals and groups.
Its Health Insurance segment provides short-term and long-term health insurance to individuals and groups.
Its Accident Insurance segment provides short-term and long-term accident insurance to individuals and groups.
China Life Insurance Development Direction
As new technology enters our market there will be less of a need for life insurance. China Life Insurance has identified these areas and are already in the process of a direction that will help them remain to remain on the Forbes Top 100 list.
As per their website China Life Insurance continue to solidify their position in Hong Kong and Macau markets by operating with pragmatism and precision. They are expanding into non-life insurance industry timely via merger and acquisition when good opportunities arise. Setting up Singapore and Indonesia branches, and developing South East Asian markets. They are actively consolidating their capabilities to go public according to unified deployment of parent company.
So how can they prepare? Many of the technologies involved, and the business capability needs they imply, take years to develop. By the time the indicators clearly show which scenario we will be entering, it will be too late for many insurers to prepare. But preparing early costs precious
investment and management attention. China Life Insurance are already identifying these key areas.
Shayne Heffernan Trade Idea
“We predict the future price of China Life Insurance will come in around HKD 20.05 which will give the stock a price increase of +35.30%.”
Price Performance
Relative Valuation
Technical Indicators
Overall, the bias in prices is: Sideways.
The projected upper bound is: 17.02.
The projected lower bound is: 14.86.
The projected closing price is: 15.94.
Candlesticks
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 29 white candles and 20 black candles for a net of 9 white candles.
A falling window occurred (where the bottom of the previous shadow is above the top of the current shadow). This usually implies a continuation of a bearish trend. There have been 4 falling windows in the last 50 candles–this makes the current falling window even more bearish. The two candles preceding the falling window were black, which makes this pattern even more bearish.
Momentum Indicators
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
Stochastic Oscillator
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 52.2222. This is not an overbought or oversold reading. The last signal was a sell 1 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 53.88. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 54 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 37. This is not a topping or bottoming area. The last signal was a sell 1 period(s) ago.
MACD
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 8 period(s) ago.
Rex Takasugi – TD Profile
CHINA LIFE closed down -0.360 at 15.920. Volume was 39% below average (neutral) and Bollinger Bands were 1% wider than normal.
Open High Low Close Volume 15.760 16.060 15.720 15.920 33,492,980
Technical Outlook Short Term: Neutral Intermediate Term: Bullish Long Term: Bearish
Moving Averages: 10-period 50-period 200-period Close: 15.91 15.50 18.38 Volatility: 49 44 41 Volume: 71,592,336 48,218,336 42,620,016
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
Summary
CHINA LIFE gapped down today (bearish) on normal volume. Possibility of a Runaway Gap which usually signifies a continuation of the trend. Four types of price gaps exist – Common, Breakaway, Runaway, and Exhaustion. Gaps acts as support/resistance.
CHINA LIFE is currently 13.4% below its 200-period moving average and is in an upward trend. Volatility is high as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of 2628.HK at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on 2628.HK and have had this outlook for the last 4 periods.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of the Hong Kong Stock Market.
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Sources:
China Life Insurance Company Website
Thomson Reuters Metastock and Eikon financial tools
