Thursday, May 31, 2007

20070531 1715. Last day of trading for May FKLI, sees June FKLI rally. A classic buy signal appeared at 1135 am in the morning trade.

20060531 0930. A morning star type candlestick pattern on the KLCI yesterday afternoon provided a possible buy signal on the corresponding FKLI, which would have turned out well today.

Wednesday, May 30, 2007

China stocks dive 6% on stamp tax rise

20070530 Well, there are still optimists among the experts. Time will tell if they are foolhardy or very insightful with sixth sense to predict the bull will continue to charge ahead.(with 50 to 0X PEs on Chinese stocks)

China stocks stamp duty raised: The final nail?

20070530 The Chinese govrnment raised the stamp duty on stock market transactions. Wonder if the b.c.s. (boh chai si) crowd in Shanghai and Shenzen will defy this step and power their bull ahead. Previously, they ignored:
  • warnings from 3 powerful people, Mr Li, Mr Greenspan and Mr Governor of Central Bank of China
  • a few interest rate hikes, along with widening of yuan band
  • raising the SRR many times by the central bank.
I think most stock markets in the region have been hit....

20070530 1230. A closer inspection of cash KLCI 60 min chart reveals the bearish candlestick frmation.

20070530 1152. A break of the 9:30 candle low at 1314.5 provides a good short opportunity. 60 min KLCI breaks the 200 sma.

Tuesday, May 29, 2007

20070529 1643. KLCI is trapped between 2 key long term moving averages on 60 min chart. Needs to break out of this channel to trend.

Monday, May 28, 2007

20070528 1702. Day trade on PMETAL went briefly in favour but petered to a loss.

20070528 1037. PMETAL looks like a good candidate for a day trade long at current price.

Friday, May 25, 2007

20070525 1715. FKLI goes on to make high of 1318, the last closing price of the day. Those long at the support level and holding for the day reap the rewards for patience.

20070525 1004. When KLCI reached 1325, FKLi quoted 1298/98.5, initiating longs according to the plan would pay off, as fkli went on to trade 1306.

20070525 0909. Waiting for cash KLCI to reach the extension of 1324-25 to get long FKLI.

Thursday, May 24, 2007

20070524 1458. 15 min KLCI remains below its longer term Mov avgs. Implications that this is a downtrend, unless can break back above.

20070524 Alan Greenspan put a spanner in the works of the bull market by saying "It is clearly unsustainable, and there will be a contraction at some point", on the state of the Chinese stock market. This is nin line with the assertion in this blog.

Friday, May 18, 2007

20070518 1637. FKLI went on to hit high of 1357. Turns out the long was 'the one that got away'. Shaken out of a perfectly good long at 1347.5. The temptation is to blame the illiquidity of the market, that caused the sudden spike to 1344 before lunch, but that is a mistake inexperienced traders make, ie to blame other factors, when the crux of the matter is they did not stick to the trading plan, or let psychology get the better of them.

20070518 1245. FKLI reaches 1350, but failed to hold the gains. Proper money management (like scaling out partially) is called for in every trade situation. Unexpected moves can be less stressful. But this can be considered a failed trade, with loss of momentum to push FKLI higher.

20070518 1045. FKLI pierces through 1347.5.

20070518 1030. FKLI levels are 1342.5 and 1347.5.

Thursday, May 17, 2007

20070517 1715. No signals on this lethargic day of trading for the FKLI.

20070517 1245. No levels setting up today on FKLI yet. Strange subdued type of trading since the gap up this morning. Levels shown are yesterday's levels. Worth noting that open position has shrunk by 2000 contracts.

Wednesday, May 16, 2007

20070516 1715. The 2nd penetration of the breakout levels proved a good long trade.

20070516 1202. As new levels form, longs should be exited, wait for the next move.

20070516 Sime Darby has surged for the past few days, and yesterday Synergy Drive announce submission of its merger proposa l for SC approval. Insider Trading?

20070516 1103. FKLI triggeres long at 1346, as the upper breakout level is breached.

20070515 Chinese stocks fell 4% today. Is this the beginning of the end or end of the beginning? Time will tell.

Tuesday, May 15, 2007

20070515 1715. With the FKLI short working well today (1328 low), we can see another setup of breakout levels, this time to the upside, triggering at 1338.50, to the high in the afternoon session of 1345.

20070515 1517. FKLI makes a bigger run down this time after the shorts indicated.

20070515 1130. Todays FKLI futures levels are set, for the breakout trades. 1353 and 1359.50.

Monday, May 14, 2007

How is AIGB doing?

20070514 In January, we identified AIGB as the possible buy of the year (for astute individual investors anyway) Today there was some news report that its parent AMMB Holdings Bhd was looking to buy out the company, propelling it 4% higher. So the stock is travelling nicely.

20070514 1715. Trading breakouts from the levels ends up as a tale of two losses today.

20070514 1245. News today was that China moved to allow chinese based banks to invest abroad more. Anyway the levels for today are in the chart above, a false short and now in the long at 1367.

Friday, May 11, 2007

20070511 1715. FKLI into the close.

20070511 1547. We have another setup with 1345 and 1349.5 as the levels.

20070511 1503. Long at 1340 would proved to be a good one.yg

20070511 1135. FKLI levels 1335.5 and 1340 for today's breakout.

Thursday, May 10, 2007

20070510 The Chinese stockmarkets are going to CRASH one day. When that will happen, depends on the forces of demand and supply. At the moment many economists and even China's central bank governor are warning that the market is getting overheated. If you look back in history, we see many examples of bubbles that parralel the current stock market craze in China:
  • the 2nd Board mania in 1996 to 1997 in Malaysia KLSE.
  • The Japanese stock market bubble in the 1990s-busted by an earthquake in Kobe
  • the dot com boom in the US and the world in 2000.
  • the Saidi market mania in 2006
  • the super bull run in KLSE in 1993
  • etc etc
What was the outcome-CRASH. A matter of when, not if, so when China sneezes next, the world will catch a virulent cold. Be aware. Oh one more thing thing, the volume traded on China's two stock markets exceed more than the whole of Japan, Malaysia, Thailand, Korea, Hong Kong, Australia, Indonesia, Singapore etc combined. In technical terms=distribution phase, in journalists and financial analysts terms=overheated. As inevitable as the sun setting in the west, the question is in the timing.

20070510 1715. Not much follow through again, proper money management controls the losses from failed trades.

20070510 1534. FKLI fires off short at 1351.50.

Wednesday, May 09, 2007

20070509 1715. Breakout levels 1340.5 and 1347 today. Neither failed to generate enough momentum to follow through. Not unexpectated as the markets wait for FOMC interest rate.

Tuesday, May 08, 2007

20070508 1715. Waiting for the close sees a bit more eked out of the short. A fellow trader alerted me to the high RSI reading on the monthly KLCI chart, indicating extremely overbought position in the stocks on Bursamalaysia. If it gets above 90, would be prudent to 'prune' stock holdings.

20070508 1630. When the market goes 8 consecutive weeks in gains, conditions get overheated and ripe for this type of correction. Oh and yes, there was a confirmation of the strongest kind when my mother's friendly hairdressor was not an expert in stock trading.... I heard of this over the weekend. Anyway the levels today came in to short at 1342.5 and long at 1347.5. The short was triggered.

Monday, May 07, 2007

20070507 1702. With the KLCI on the 8th consecutive week of rise, some resistance might be expected going forward.

20070507 1703. Support and resistance analysis can aid in trading all timeframes. With the identification of a range and levels on the 60 min chart, taking a breakout trade on FKLI futures when the FBM100 breaks out proves fruitful.

20070507 1647.A long trade, after the levels of 1362 and 1353.5 were established today. FKLI right now is 1356, as it had moved down against this position. However, with a proper plan to take partial profits and tread positions as segments, risk can be controlled.

"There is the plain fool who does the wrong thing at all times anywhere, but there is the Wall Street fool who thinks he must trade all the time."J Livermore Manchester City FCl Crude Palm Oil


From Dragons and Bulls by Stanley Kroll
Intro and Foreword
The Importance of an Investment Strategy
5 The Art of War, by Sun Tau (circa 506 BC) and The Art of Trading Success (circa AD 1994)
That's the way you want to bet/a>
Long-term v Short term trading
Technicals v Fundamentals
Perception v Reality
Part 1: Winners and Losers
Part 2: Winners and Losers
Sun Tzu: The Art of War
Those who tell don't know, those who know don't tell
Why there is no such thing as a "bad market"
The Secret to Trading Success
The Experts, do they know better?
Risk control and money management
Good advice
The 'good bets' business by Larry Hite
Don't lose your shirt
Ed Sykota's secret trend trading system