Saturday, August 13, 2016

FBMKLCI - Bull market is coming!

Forget about the market crash, cause financial market will not crash this year!

In line with the Wyckoff accumulation schematic, the selling of FBM KLCI was well absorbed and hence was accumulated since the selling climax in Aug 2015, which indicates FBM KLCI has successfully formed a bottom for the 2 years correction (Jul 2014 to Aug 2016).

Today, FBMKLCI managed to close above 1681 to violate the downward trend-line shown in the figure.

Given that FBMKLCI is now trading well above the 200Sma, FBMKLCI is poised to regain strength to turn bullish again.

This is the weekly USD/MYR currency chart. Just to clarify in case if you are unfamiliar with currency chart, up move in USD/MYR means Ringgit is weakening, equivalent to US dollar gaining strength, and vice versa.

In the chart above, Ringgit has weakened against US dollar from May 2013 to Oct 2015.

The chart above clearly highlights the Bump and Run Reversal chart pattern formed on USD/MYR currency pair. This means the weakening of Ringgit against US dollar has reached an end for intermediate to long-term (1 year), and Ringgit has successfully retested the middle trendline in June 2016.

The is the USD/MYR chart but zoomed in onto the daily candlesticks of USD/MYR chart spanning from Jul 2015 to Aug 2016.

As we can see, the downward trendline for the USD/MYR is getting steeper, so we can expect an accelerated sell down of US dollar against Ringgit in future. 

So what does all these currency charts suggest?
These signals from the currency charts conveyed a clear message that Ringgit will strengthen moving forward.
So how does all these related to FBM KLCI and Malaysia stock market?

If Ringgit were to strengthen against US dollar, it means the foreign funds will be revisiting our market soon after the 2014 and 2015 capital exodus, and we will see the return of bull market.

Disclaimer: This is an expression of personal opinion of the author, the author is not responsible for anything happened to the readers after they read this post.

My comments: I mentioned how 2016 was going to be a mouse-trap year for investors. It will be a year full of surprises! I don't know what is happening but will use the "bull market" to dispose off slowly what I have when my TP is reached. Good Luck to all.

Sunday, August 7, 2016

Thursday, August 4, 2016

Good Advice from Sifu Fred Tam

KLSE OUTLOOK FOR 04-08-2016: CORRECT STOCK PICKS SAVE THE DAY FOR THE INVESTOR IN THIS SOFT MARKET - BY FRED TAM ....Extracted from Fred's Facebook posting today ....It is okay to buy on rumours and tips in a bull market because, as the saying goes, “all boats float in a high tide”.

But this is a bear market we are in. We are in a “low tide” situation. Buying on rumours and tips when the tide is low will only deplete and ruin an investor’s capital rapidly as most tips will not result in follow-through buying as finding a “greater fool” is that much more difficult.

In other words, “in a low tide all boats sink”. ...Good Advice from Sifu Fred😊

Tuesday, July 19, 2016

The Market Operators

I believe that most of us have heard of stock market operators. They are known by many different names and they are constantly the blame for our financial losses. In some parts of the world, they are known as sharks, syndicates, big bosses, speculators, liars, cheaters or stock market manipulators. Some of us cheer their existence and their operations while some cursed them as if they are the culprits to our financial ruins. Are they our friends or foes? As the famous saying goes, know thy foes and you will have the upper hand in battle. In this post, I will challenge and dare you to swim with the sharks and eat from the crumbs of their feeds and not to be their feed. Here I would like to bring out some of my personal thoughts on this question that most newbie has.

Ok, here is the short answer. Yes, you are right. They existed and their operations are hidden from most people especially the newbie in these financial markets. I believe if we know them and how they operate, we could actually move along with them. In fact, the whole purpose of technical analysis is to determine the balance of demand and supply and the stock market operators are some of the powerful and rich individuals or groups with much buying and selling power. If we are able to track their movement, we will be able to profit from their operations. However, if we are ignorant of their existence, we could be their next meal.

Basic facts of stock market operators are listed below for your reference :

**They work individually or in a group.
**They rely on the market trends to help them in their mission.
**The general public are their big customers.
**They together work with the public listed company owners or insiders.
**They have a main mission objective to accomplish.
**The bulk of their operation revolved around the accumulation and the distribution of stocks from / to the general publics.
**They are rich and powerful figures but they are also humans that have emotions like all of us.
**They have extensive credit facilities and lower transaction costs than the retail investors.
**They do make mistakes like any one of us. Their mistake costs millions in dollars.
**Market news, stock market analyst, corporate announcements, word of mouth advertising, price bidding and order queues are some of their tricks and tools that they used to achieve their main objective.
**They don’t try to pick the bottom or the top like most retail investors do. Again, some of them try to do this and it costs them much sorrow and dismay.
**They do attempt to manipulate the chart to trick the chartist whether you like it or not.
**They are both the buyer and seller in the queue order at any given time.
**They are not doing charity work. They existed to make your money.

It is important to understand them well as they are big volume buyers and sellers. They can tilt the balance of demand and supply. Understanding the above traits of stock market operators will help to clear some of the myths that we have of them. Remember, they are humans like us. Some of the above points deserved to be elaborated further to bring out the secrets of trading methodologies that we will employ in our technical analysis.

Primary market trends are very important to their success and failures. If they judge wrongly on this, they could go bust easily as the power of leveraging will work against them. Remember this, they cannot fight against the trends and they don’t have the strength to do so. Don’t ever think that they can swim against the tides.

If their mission objective is to acquire stocks, they might push down the prices to cause temporary market panics to squeeze out the stocks out from the speculators and investors and this is especially true in certain countries where short-selling is not allowed. The success of this technique will depends on what sort of people that are holding the stocks. This will get rid of the intra-day and short- term traders. However, they will try to maintain the prices around a certain range as to keep the sellers motivated. Usually the public listed company owners and insider will work in tandem to collect the shares from the general public. After they exhausted the fearful speculators and investors, they will then turn their eyes to the stronger speculators and investors by pushing up the prices higher to catch their interests.

If their mission is to distribute stocks, they will push up the stock prices to catch the attention of speculators and investors. They will work with market analyst to create beautiful pictures of the company prospects. They will work with the public listed company owners and insiders to create scarcity of stocks. At this moment of time, they will also announce all the good news while pushing up the stock prices. They will queue up as buyers and sellers in the order queue. They will buy their own stocks to create volume to entice the crowd to follow. As they bid up and down the prices, stocks were distributed without the awareness of the general public.

I believe that this write-up will increase our trading knowledge and make us a wiser trader. I will continue to write of how we can profit from their operation in future posts whenever I managed to get my time organized.

*not from me but forward from some other places.. Massive respect to the write and credits to him..

Source : Big Canon Finance Blogspot

Saturday, July 16, 2016

The Monkey Business

There lived a lot of monkeys near a village.

One day a merchant came to the village to buy these monkeys.

He announced that he will buy a monkey @  hundred rupees each.

The villagers thought that this man is mad.

They thought how can somebody buy stray monkeys
at 100 rupees each?

Still, some people caught some monkeys and gave it to this merchant and he gave 100 rupees for each monkey.

This news spread like anything and people caught monkeys and sold it to the monkey merchant.

After some days he announced that he will buy monkeys @ 200 each.

The lazy villagers ran around to catch the remaining monkeys.

They sold the remaining monkeys @200 each.

Then the merchant announced that he will buy monkeys @500 each.

The villagers  lost sleep. .They
caught six or seven monkeys ,which was all that was left and got 500 each.

The villagers were waiting anxiously for the next announcement.

Then the merchant announced that he is going home for one week.
And when he returns, he will buy monkeys @ 1000 each.

He asked his employee to take care of the monkeys.
He was alone taking care of all the monkeys in a cage.

The merchant went home.

The villagers were very sad as there were no more monkeys left for them to sell it at 1000 rupees each.

Then the employee told them that he will sell some monkeys @700 each secretly.

This news spread like fire. Since the merchant buys monkey @ 1000 each, there is a 300 profit for each monkey.

The next day villagers made a queue near the monkey cage.

The employee sold all the monkeys at 700 each.
The rich bought monkeys in lots. The poor also borrowed money from money lenders and bought monkeys.

The villagers took care of their monkeys & waited for the merchant to return.

But nobody came...😳
Then they ran to the employee. ...

But he has already left.

Then the villagers realised
that they have bought the useless & stray monkeys
@ 700 each and unable to sell them.

This is the business  known as STOCK MARKET.

This business has made a lot of people bankrupt &  a few people filthy rich in this monkey business.

This is the story of the stock no ..monkey market ?