Monday, 31 December 2012

Straits Time Index

I am back after another trip last week.

While i was overseas, it was interesting to read "bullish headlines" about how the market will gain another 25-30% or resumes its uptrend in 2013. As usual, the crystal ball grazing provides tons of fun but little value. In fact, it might act as a good indication of an imminent correction that always occur whenever the headlines of local newspaper turned bullish (the reverse is true as well).


STI has turned into a sell for me today. My first target is around 3100, followed by 3050.

Hope all readers have a happy and prosperous 2013.




Tuesday, 18 December 2012

Noble Group & CapRetailChina

Noble

Noble hit my first target of 115 last week. My earlier post is here.


CapitaRetailChina

Hit my first target of 1.60. My earlier post is here.

Thursday, 29 November 2012

Recap - Sembcorp, Sembmarine, Noble and Olam

Just to a quick recap of the various positions i mentioned last week plus olam.

Sembcorp Industries

My initial post was here. The stock hit my initial target today. Still looking strong. Let's see if it can hit the $5.30 - $5.40 target in the coming days.




Sembmarine

My initial post was here. Hit my first target today. Let's see if can reach $4.70 - $4.80.


Noble

My initial post was here. The counter was actually on trek a few days back when it touches 1.11 but unfortunately, i think it was also dragged down by the muddy waters incident. My view of a rebound back to 115 is still intact.


Olam


While this is not exactly my favorite counter in terms investing, it is nevertheless "too late" to short now unless you see a meaningful rebound back to $1.80 area or a decisive break below 1.50. In any case, there are no scrips available and from what i understand, the scrips were loaned out at 10% p.a. I think a short squeeze for a rebound back to $1.70-1.80 is on the cards. The Muddy water report has been released and the link is here --> http://www.muddywatersresearch.com/research/olam/initiating-coverage-olam/



Thursday, 22 November 2012

SembCorp Industries

Sembcorp Industries looked ripe for a rebound back to the 5.10 to 5.20 region (first target) and we shall see how it performed from there on whether it can hit 5.30 to 5.40. (second target).

Sembcorp Industries

CapitaRetailChina & Sembmarine

Two nice looking charts to share.

CapitaRetailChina

CapitaRetailChina
Spotted this when it was around 150-152. Neat cut loss below recent low and target a swing back to 158-160 (first target).

SembMarine
Sembmarine. A rebound back to 4.40-4.60 on the cards?

Monday, 19 November 2012

Time to be Noble?

Noble looked interesting for a short term counter-trend trade. It has a bullish harami the day before and 1.05 seemed to be a strong support that extends all the way back to 2011. The founder and CEO have bought back the shares at around 1.08 in the last few days and that could provide an interim support for this counter. The reasons for its huge drop last week was due to "below than expectation" results and that one of its 3rd largest shareholder, Harry Banga, placed out $200m worth of shares.

Daily Chart

Daily Chart



The target for the rebound will be around 115-118 with a stop loss below 1.02. Given that this is a counter trend trade, it will be wise to be nimble and much will depends on how the US markets perform this week.

Weekly Chart

Weekly chart
You can see that it took 12 weeks to move from 1.08 to 1.35 but only 2 weeks to move from 1.35 back to 1.08.....

Tuesday, 13 November 2012

Watch the STI neckline!

I have shared with you on stars gazing and on hammers. Today i share with you the neckline and how to do a projection if the neckline is 'broken'. 



The neckline of STI is around 2,980. If the neckline is breached, it usually means an ugly show as you will lose the pants as well. 

The STI looks like forming a double top formation. To project the downside, simple use 2980 (neckline) less the sum of [3,088 (around the high of the double top) - 2,980 (neckline)] = 2,872 (downside projection target)

   

Trading is a probability game and this is my current view on STI should the neckline be breached. If it comes, it is usually fast and furious.

I will usually not trade unless i am either shorting or until i see clearer buy signals. Happy trading.


Friday, 2 November 2012

Watch out for the hammers

Not sure if you remember my post on "the stars are starting to appear..."back on 18 Sep.

Today I write the other version of it. Watch out for the hammers and this will be how i can potentially trade it.

Hammer


As in a shooting star, the hammer in the candlestick is the other opposite version of a reversal signal at the end of the "correction". The aggressive trader will buy near the close of 1.07 yesterday and put a stop loss at 1.02. The less aggressive trader can buy this morning and use the same stop. The first target will be around 112-114, the second target will be around 116-120 and the more aggressive target will be around 122-124. Since the price has already moved up, i will also move the stop to around 106 to ride the stock.

Shooting stars again?

GLP and Osim showed shooting stars today and i will usually tighten my stops if i am trading the position.



Happy trading.


Tuesday, 16 October 2012

CapmallsAsia

An update to my previous post on 15 Sep 2012.


A very nice cup and handle pattern. This is a bullish pattern. Enjoy the ride... 

Wednesday, 3 October 2012

No 3 No 4 ?

I haven't been trading actively since my last posting to share with you how to watch out for the "stars". 

For the last 2 weeks, the market was probably in a no 3 no 4 (不三不四) situation where it was neither going up nor breaking down. It is basically in state of confusion and in a limbo until we can see a clear winner between the bulls and the bears. I will probably continue to stay on the sidelines until i can see trades that give me a better risk-reward ratio.

Straits Times Index



Let's do a quick recap on STI. My previous post was here3088 seems to be a nice 4-D number and a pretty strong resistance. It seems unclear whether STI is going to break above 3,090 to resume its bull run or consolidate sideways and form a double top but i will watch the show from the sidelines. 

Ezion



Ezion seemed to be undergoing a correction after its strong run up. It has almost doubled in price 4 months! What a spectacular run. Traders who are keen on this sector can probably wait for the correction to finish its course before getting back in again.  I think it will likely do a correction in the coming days.

STX OSV



Very interesting counter. I am interested to buy this for my SRS portfolio but the major shareholders are  'selling real hard'. I will see how this goes.

Olam



One reader asked for my view on Olam. I think Olam is trading sideways with downward bias  towards the $1.90 level. No change to my earlier views

It is always difficult for me to give a view because I am unable to advise on your own risk tolerance and investment horizon. I will share a topic on risk and reward next time. You have to know your own risk and reward each time you enter a trading position. If the risk versus reward is not good, then just give it a miss. I see some traders risking a large amount of capital for a small profit (example buying 500 lots for a 2 bids movement). Well my only kind advice is that make sure you can cut loss before you move to this level. This "level" is for the 'professional' scalpers who can monitor the market closely. It will not be suitable for traders with limited capital outlay or traders who have difficulty cutting losses quickly.

Happy trading.

Monday, 24 September 2012

Importance of Closing Prices

It's Ninja Lesson time.

I am not sure if you have heard of the quote before

"Amateurs open the market, but professionals close it".

 In short term trading, closing prices are more important than opening prices. It tells your the force behind the price movement and whether the price is weak or strong.

Who sets the opening price? Usually it will be people who have read the news (such as results or news announcement) the night before and then put in their orders early in the morning before market opens. 

Who sets the closing prices? Usually, it will be the professionals or market players who determine how and where the prices should close. They have their reasons for wanting to close the prices at a certain level and they usually come into the market nearer to its closing time. Which is why sometimes you see a spike in volume after 4pm for the Singapore market and you can even see some stocks closing 2-3 bids higher than the last traded price between 5 to 5.05pm. This is just one example.

Some examples of "professionals" who set the closing prices. 
Case study 1 - business owners who have pledged their shares for loan.
Case study 2 - Fund managers who buy the shares near the close of the market. The more obvious ones are found guilty and the more subtle ones get away. :-P
Case study 3 - Fund manager who window dress.

Examples of other types of instruments besides stocks and shares - Oil price is rigged. LIBOR is rigged. Gold price is rigged. hahaha

I have shown you all the 'negative' examples but you can probably get the idea as to why closing prices are more important than opening prices. 

On a more positive note, it can also mean that the stock is gaining a lot of attention and fund managers and retail investors alike are piling into the counter. Probably this can help explain the rise in Far East Hospitality today? :)

Happy trading.

Tuesday, 18 September 2012

The stars are starting to appear for some stocks..

You must be wondering why i wrote this post last evening about looking out for shooting stars and evening stars etc. This is because this is usually the first sign that the market is undecided and hints of possible corrections.

Some of them have appeared and if you are a trader, it will be good to tighten your stops when a doji or shooting star first appear. 

Just scan through the charts and i am sure you can catch some of them. I share some of them with you so that you know how to spot them yourself.

Evening star - Noble. A possible correction back to the 1.25-1.28 region


Shooting star - Olam. A possible correction back to the 1.90-2.00 region.


Evening doji star - SC Global. A possible correction back to the 1.05-1.10 region


Happy stars gazing.

Monday, 17 September 2012

Look out for the shooting stars!

There are a few phenomenons in the stock market which you may want to watch out for to determine if the bull run is coming to an end soon. It is like an early-warning system.

What are the few phenomenons i will watch out for?

1.  The pennies start to run.


Be very wary when the penny stocks suddenly come alive and hog the top 20 volume counters. These are usually stocks that have no fundamentals to begin with and are what the hokkiens will say "5 cents 10 cents" stocks. 

My definition of penny stocks are stocks that are very cheap in monetary terms but expensive in valuation terms. In other words, they may only be trading at 10 cents but the reason why they are trading at 10c is because they are usually loss making or trading at have very high PEs. These stocks will usually start to run only after the blue chips and good stocks have 'finish running' and the profits made from those stocks are now being rotated into the penny stocks.

Whenever you see many penny stocks running, it is time to take money off the table.  


2. You start to see stars!

If the stocks you are invested in start to show you stars, it will be a good idea to tighten your stops. You can check out the different types of bearish stars here. Two types of stars are presented below for your reference. 

Shooting star
Evening star

It can be a shooting star, it can be evening star and they usually appear at the end of an extended run. Be wary when the stars start to appear!


3. Taxi uncles and housewives comes to the market


The above is a generalization. I am sure there are many educated tax drivers and sophisticated housewives. (so pardon me if you belong to this category. haha).
Basically it means people who never touch the market starts to flock to the stock market thinking there is easy money to be made.  For example if someone who doesn't dabble in stock suddenly starts to tell you what stocks to buy. You know the end is near!


4. When newspapers headlines are very bullish.

Usually you will see many bullish headlines at the peak. The reverse for a stock market bottom is true too! 


Here you go. I have shared with you the various symptoms which you should look out for. You will be able to see it when it comes. 

Happy investing.

Closing off position - Sarin

Diamonds are forever but not this position of mine.

I have adopted trading strategy (3) and unloaded all my position in Sarin at 105 :)

Happy trading.

Sunday, 16 September 2012

CapMallsAsia & JB Foods

A possible swing trade back to 1.70 or better with a cut loss below 1.60?


Interesting to see that JB Foods have finally turned "positive". Perhaps it is because the CEO started buying at 1m shares 29c recently. It has also recommended a 1c interim dividend. Probably can see higher prices in the coming days?

Saturday, 15 September 2012

STI and Sarin

Let's do a quick update on STI.


Further to my post on 8 Sep 2012, STI has moved above 3050. I see some traders doing 'short trades', my personal opinion is to play stocks on the long side for now as STI has seemed to resume its uptrend and most stocks are trending up and taking turns to be a dog. haha.  STI should be able to break its resistance at 3090 in the coming days.

Anyway, i was lucky to bite the bullet and took a long position in Sarin on Thursday morning. Otherwise, it will be another lamenting post. One thing good about illiquid stock is it moves up and down very fast... hahaha... now that i have entered the positions and the stock has moved up quickly, there are a few ways to trade this. Choose one that meets your personality and style.

(1) Sell some at current levels and let the remaining ride the trend with a moving stop.
(2) Ride the trend but put a moving stop (meaning i will liquidate my position if the price hit the stop price). Move the stop to around 98c.
(3) Sell all at the resistance levels of between 104-108.
(4) Ride the trend till the sell signals appear.


Happy trading. Enjoy while the diamond sparkles.

Thursday, 13 September 2012

Sarin and F&N

I decided to take the trade this morning before being 'consumed' by meetings the whole day... :(

Same target and cut loss price as mentioned in my posting last evening.


I am quite 'upset' with myself. If you remember my posting on 30 July, i have been monitoring F&N since then and wanted to pull the trigger last friday...sigh..too bad... good luck to readers who have the stock as the Thai Tycoon has finally show hand.. Looks like the APB sale may be derailed! :)

Wednesday, 12 September 2012

How come i am so busy...... :(

It has been a frustrating week as i missed out on a few trades due to a very busy week... :(

These were for counters i were seriously contemplating for a long trade but I put them off due to back-to-back meetings. Perhaps I should have just bite the bullet and trade them!

Monday - Wanted to do an arbitrage trade on F&N since the buy back is at $8.50 (this one rank second)
Tues - Wanted to buy Yanlord at 1.16 yesterday (this is the biggest regret. hahaha).
Wed - Wanted to buy UOB at 19.30 this morning. (this one is expensive...)

Urggh...maybe tomorrow the heartache will be Sarin? I have a day full of meetings tomorrow...sigh.

I quite like the set up for Sarin but the liquidity is really too low for my liking. This is a counter trend trade, thus the cut loss will be tight, below the recent low and target will be around 98-100. :)


Tuesday, 11 September 2012

Online "Investing" Competition?

It is interesting to note that SGX (or most other organizers) call this an "Investing" Competition. The website is here.



The more appropriate name for this competition should be the Art of Speculation where the speculator with the most profits win! If you want to learn about the art of speculating the stock market without being burnt, this is the competition for you. Unfortunately, it will not help you in your trading or investing journey. Let's take a look at the winning criteria.



In order to win this competition, the winner will likely be one who takes concentrated positions and bet 'big' in a few stocks which is more volatile (i.e. have a higher beta). Players will probably try to catch all the upswings and downswings to maximize the opportunities of winning. I will be very surprised if the winner on 30 Nov is one who 'buys now and sells on 30 Nov". The winner will likely be a speculator who don't really practise money management and bet big. In any case, i will play it this way to win since this is just virtual money. I will be interested to find out and analyse the trades of the winner at the end of the competition if it is available. :)

I would consider this game as a form of entertainment as this will not be how you will play with real money. However, it may encourage players to trade more in real life to generate commissions for sgx.

Happy Speculating :-P

 





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