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Tuesday, August 31, 2010

Learning Corner : RSI

What is RSI - Relative Strength Index

Developed by J. Welles Wilder and introduced in his 1978 book, New Concepts in Technical Trading Systems, the Relative Strength Index (RSI) is an extremely useful and popular momentum oscillator. The RSI compares the magnitude of a stock's recent gains to the magnitude of its recent losses and turns that information into a number that ranges from 0 to 100. It takes a single parameter, the number of time periods to use in the calculation. In his book, Wilder recommends using 14 periods.

Overbought/Oversold

Wilder recommended using 70 and 30 and overbought and oversold levels respectively. Generally, if the RSI rises above 30 it is considered bullish for the underlying stock. Conversely, if the RSI falls below 70, it is a bearish signal. Some traders identify the long-term trend and then use extreme readings for entry points. If the long-term trend is bullish, then oversold readings could mark potential entry points.

Divergences

Buy and sell signals can also be generated by looking for positive and negative divergences between the RSI and the underlying stock. For example, consider a falling stock whose RSI rises from a low point of (for example) 15 back up to say, 55. Because of how the RSI is constructed, the underlying stock will often reverse its direction soon after such a divergence. As in that example, divergences that occur after an overbought or oversold reading usually provide more reliable signals.


Centerline Crossover

The centerline for RSI is 50. Readings above and below can give the indicator a bullish or bearish tilt. On the whole, a reading above 50 indicates that average gains are higher than average losses and a reading below 50 indicates that losses are winning the battle. Some traders look for a move above 50 to confirm bullish signals or a move below 50 to confirm bearish signals.

Wai : There are many technical books written about it. Need NOT to be too technical. I could use a day to show you what I know about RSI and also question on what I do not know or still 'investigating'.

I was showing RSI to my cousin-bro(a loooong term FA investor, as he claimed) last Sat in less than an hour. Well, as he Maths is quite good too(I was teaching him when he was taking STPM, so I know his level) and should be able to comprehend better when we speak about probability and such. I do use RSI-9, RSI-14 and RSI-26 together with stochastic to check if the particular stock overbought or oversold.

RSI in YouTube




More resource : http://stockcharts.com/school/doku.php?id=chart_school:technical_indicators:relative_strength_in


Revision :RSI trading system

BUY when RSI > 50 - bullish signal
SELL when RSI < 50 - bearish signal
DOW down by 140 points, barely above 10,000 level. Crude oil below USD75. KLSE closes today as Malaysia is 53th today.

While JCY reaching for new lows, A123 paused from moving lower and seen some bargain hunting. It is above USD7 now(low at USD6.32). How low JCY could go? 90cents? 80 cents? or lower? I will buy more at 0.88 and 0.77 and 0.66 ... I dont know about 0.55? Buy or bye? To me, it is a strong BUY at the moment. The prices should have factored in the bad news but we could see more selling. Markets always over-react, especially during the selling.

I m recalling AirAsia dived from RM2 to penny stock! Do you remember or perhaps I should check the chart of AirAsia later. I was very new then to dare enough to BUY Airasia at 0.90? Today AirAsia climbed back to 1.70 level? Will it go back to 2.00?

Markets will over-react when it dives as it is human nature to re-act towards the FEAR. Will JCY becoming another LCL, for example? Especially if a person bought into LCL or Kenmark recently as learnt a painful lessons. So, will it be wise to hold on to the knife?

At times we need to go against the tide, when many screaming for SELL, that should be the time we collect those abandoned stocks. Most of the time, the crowd/herd is WRONG. But at times, like KNM, LCL and such, SELL with huge losses is the only choice.

If I continue to collect at lower level, the fear will be ... it never recovers. JCY is NEW ... and no a long history for us to check on its chart. AirAsia will rebound. JCY??

After thinking about it, and reading articles or reports related to HDD, I believe JCY will rebound. So, I need to be dare enough to INVEST in such lousy stock. Notion, Unisem, ENG are also badly battered. Time to collect these stocks too? I like Unisem the most but cleared it for small loss the other day to buy more of JCY.

ZhongWang : New low at 4.51, closed at 4.60 yesterday. RSI at 35, so will I enter when RSI below 25 and reaching for new low ... say, below HKD4? This is my HKSE's waterfall I m collecting. I will be clearing TopGlove for a loss and buying into this one.

With JCY, A123 and ZWang in my portfolio, these are huge waterfalls. Each losing more than half of their values and trading far below their IPO levels.

Wish me luck with my waterfalls. MERDEKA.

Yes, need to make independent decisions from the herds.

Property searching

I went to Shah Alam last night. we were at SACC Mall and ... hmm ... the only Chinese family seen!! It has been years since the last time I landed in SA. I could only remember PKNS complex but SA has few new malls and building. Not much changes and we like it 'slow'. Well, I m not a person who will like to stay in Chinese area like Subang Jaya. And they said many Indians in Klang. I do not want my kids growing up discriminating human by the colour of their skins. So, staying in SA is not an issue for us. SA is near than Klang.

I m actually looking into Shah Alam seksyen 25 or above, nearer to Subang Jaya side. Shah Alam is actually very big!! Puncak Alam houses are cheaper and nicer but it is too far! So, I need to look into places nearer to Subang Jaya, if possible.

Klang - Bandar Putera and Puteri are good alternatives. So, today I will take a look over there. I m looking at those below Rm200k. Next question - should I bother if it is freehold or leasehold?

Property : freehold vs leasehold

Yes, obviously many will go for freehold houses and it costs more. Normally the leasehold tenure will be written there as 99 years(I wont be around by then, of coz) ... so, if I m buying to STAY there for long, leasehold is fine. But, currently my intention is to stay for 5-8 years. By then, I think I could afford another property(and my loans for my apartment in Sabah will be fully paid off). Depending on my financial situation by then ... could I be able to sell my property if I m buying a leasehold house now?

Many advised me to buy only the freehold as the leasehold houses will depreciate in time. I checked on few housing area(leasehold ones) in Puchong and what they said is NOT true. In fact, due to the demand, those 'old' leasehold houses have appreciated very much(compared to the initial launching price).

LOCATION : This is the main point, I believe. If the location is high in demand, even if it is leasehold, people will buy(to stay). There are still many medium or low salary earners like me in Klang Valley.

So, I think it doesnt matter much whether it is freehold or leasehold? If the leasehold is cheaper in price, I will consider it(seeing that my income is not high, yet)

Saujana Putra I seen last week by LBS is leasehold and it is a new housing area. Of coz I WONT buy the new houses from the developer as the demand there is NOT high and many selling at almost their cost prices(after 3-5 years ... so, 99 - 5 = 94 years left).


1. Landed prefered
2. Non-bumi lot
3. Leasehold or freehold
4. Single storey
5. 15km or less from Subang Jaya

1.45 pm : I just finished a 3-hour tuition class(rate : RM100 per hour). But a colleague of mine, who is also teaching Math having 6 hours of tuition today (= RM600). So, I need time to establish myself as a tutor(as I know I m good, if not better than most of Math tutor here) over this area. Once that is done by next year, I should be not so tight financially and also can start putting more money into my investment banks(OSK, RHB and CIMB - thinking of Jupiter).

IF all my waterfalls fail to rebound and as large amount of my funds will be stucked there for some time, I will be losing my investments. I wont mind being loooong term investor with whatever I m holding to(at the moment, no obvious flaws in those waterfalls) until a huge change in its fundamentals which give me reasons to sell with huge losses(one day).

In the mean time, it is all work-work-work, to pay for my basic commitments and accumulating some bullets. Increase my fixed income(salary), increase my extra income(tuition as a business) and put into investments(stocks and property) while continue to acquire more knowledge about MONEY - accumulating it and create wealth ... in order to be financial free ... one day. My plan to be atrainer one day still in tact, at the back of my mind.

At the moment, I m still new to tuition market here. I m also still new in share markets. I m definitely not qualify to coach anyone just yet. But with my determination and persistence, I know I could dare to dream ... further than what I m acheiving now.

MERDEKA ... well, it is financial independence that I m looking for ... perhaps at age of 50(another 7 years). Then, I might drop my full-time job, giving tuition in my own center and coaching trading/investing in stock market using my center. By doing that, I could have more freedom too ... knowing I hv financial freedom without much worry about money as the main subject.

I woke up in the morning thinking of MONEY ... and I sleep at nights stressing by MONEY. I know my goals well ... and also still refining my ways of earning money while trying to reduce expenses. Every dollar save is a dollar earn, as they said.

Hold on ... I m still uptight and struggling now. Just another 5 years ... I will like to see myself as what I m imagining now. MERDEKA.

ZhaoJin(1818.hk) : HSI down almost 300 points but ZhaaoJin breached HK20 today, to the new high ... markets may go down, GOLD will continue to go higher. Its PE now at 35. When I recommended Dr Julian to buy at HKD10, he was very glad to take profit at HKD13(30% profits in less than a month - he was impressed then). Today, he will still curse me for not showing him those stocks which doubled or tripled in 3 months! I have one year time frame in mind when I was coaching him. He became GREEDIER(from a person who dont even know what a stock is or how to trade a counter!!), of coz.

Dr Julian Lim - a Dr Jackyll and Mr Hyde in real life - and will always an experience in my life. I have to teach my kids to aviod these cunning people. Hey, Dr Julian, are you still with Sabah Medical Center? Are you still in markets? Are you still reading these lines and my blog - while cursing me in your prayers? I hope not ... as I have tried to make peace with you. You have ignored my sms or e-mail. Heard from my wife that your wife(my friend too, ok?) giving birth to a baby girl? Congrats!! Keep away from my blog, ok?

For new readers, Dr Julian was my first student when it comes to coaching about trading/investment. I taught him INVESTMENT, actually. But he got greedier and want to earn money in faster rate. Then, I taught him MACD crossover, RSI and such ... 40% of what I knew then(one year plus ago). I do not think so market is suitable for him. He is too coward and greedy. I believe those two characters are a set-back in a person's success in investment. I dont show him AnnJoo-wb but asked him to buy AnnJoo at RM1, instead. P/E was below 5 then. Today, what is the price of AnnJoo, doc? And what is the price of ZhaoJin? He changed his initial words - he told me he want to learn investment from me with time frame 1 year. And he will be glad if he could get 10% or more per annum. Hai-chee ... excuse me, human changed when they realised(as they thought they were) that their INTELLIGENCE could certainly do better than their initial targets!! Arent we a greedy lot?

I m still very firm with my LEARNING process. I m more concern about how much I have learnt and how do I apply what I m learning. So, by buying different stocks, in different markets under different market environments are my motives. Profitting is a bonus. Yeah ... in a way, I m accepting losses IF my theories and plans go against me. Do look at current level ... talking about market efficiency 2 months ago ... trying to apply it here, buying into waterfalls!! With a longer time frame, looking into the rebounds ... learn learn learn.

Example of GREED : Sinotop


TEH

Monday, August 30, 2010

JCY's weekly chart. New low at RM1 broken today. Latest low at 0.965. Buy or bye?

12.30 am : Koo and Tan lost easily in the rubber-set. For non-sport fans or badminton players, rubber-set is a term for third set, nothing to do with rubber. Need to learn the terms before we could even discuss about a topic or event.

Property : Bumi or non-bumi status

As we are heading for the UNITY or so-called 1Malaysia, we have to see this critically. My wife is a bumi and I m not. So, I do have a choice of buying a 'cheaper' house using bumi-status. But, as my kids are non-bumi(followed daddy), they might have difficulties selling the house in future! The discount given is 5%(I remembered it was at 7% previously?) and 5% of RM300k is a substantial amount. If the area is a 'Malay' area like Shah Alam, perhaps I could sell it easier someday. But selling a bumi-lot in a non-bumi majority area might face some challenges(unless u r lucky or have a good bumi friend where you could load of your parcel to him at discounted rate).

After weighing the pro-n-cons, I m going for a landed non-bumi house. With that two points in, I do not have much of a choice but to fork-out more $$$ in order to find a decent place to stay. As mentioned yesterday, Subang Jaya and vicinity are too expensive, reaching RM250k and above easily. I could only afford something below RM180k. With that ... I have to stay further away from the center, Subang Jaya.

By the way, dear all politicians ... I m a MALAYSIAN, shouldnt be discriminate if I m a bumi or non-bumi. It gives us who love our country a sour taste. And stop asking us to go back to China as I know nothing about China. I m born in Penang, I know Penang very well. I dont appreciate Shanghai, ok? I feel sad when Koo and Tan lost to the Chinese pair last night, ok? I speak Malay well but I will be lost in China. Do you understand? I m tanned and look like a Malay, and if I m to be in China, they might even think I m form Indonesia!!

I do not discriminate my Chinese students or Malay students ... I teach them well irrespective of colours. I have many Indian students ... not from India. They are MALAYSIAN.

If 1Malaysia concept is going to work, STOP branding us as a BUMI or NON-BUMI. That is hypocrite at the highest level!

Dont let me start about this so-called sensitive issue. I have always seen myself as Malaysian. I used to place the Malaysia's flag proudly, seeing that I m staying in such a peaceful country without much natural disasters.

MERDEKA ... and be independent. I mean, REAL independence.

9.15 am : OMG ... KLCI up 16 points now. BULLISH. SIME is good!!

There is an event to celebrate Merdeka day in our campus. They played the song Jalur Gemilang and I was humming it. See? Told you I m a Malaysia. I dont care if my country is called China-sia or Malay-sia. It is the place we are born. Both my parents are Malaysians too, even my grand-parents are Malaysians. I m the fourth generation in my family who are all MALAYSIANS. Legally, we are Malaysian ... but the gov called us NON-BUMI or Chinese. I m confused ... Chinese as from China? Hmm ... then, they phrased us as Malaysian-Chinese as we have Singaporean-Chinese. Weird ... we have Chinese all over the world, actually. They migrated(legally or not) ..but I m not. My root is HERE. Why should I be seen differently?? WHY cant I get the so-called privilages .. and buy a house in EQUAL status as ALL Malaysians should? WHY do we care if the developers are bumi-developers or not??

MERDEKA ... they just yelled. About 200 plus students given the small Jalur Gemilang(our country's flag) while watched by some YB and VIPs. Is it merely a SHOW or are we instilling the love of our country in the right manner? WHY I CANT FEEL THE STRONG EMOTIONS anymore ... which I have when I was in my primary? My best friends were an Indian, a Malay and two Chineses? We played together without speaking about our colours of our skins?

JCY : Welcoming her to the new world - the penny-stock world. at 0.995 now. Do nothing until buy at 0.88. Patience is virtue.

JCY : At 0.975 now ... diving to the road of no return?

4.01 pm : JCY at 0.97, rebounded to 0.995 just now but selling pressure is very great. 0.88 please?

KurAsia : Losing her 50-cent status as it is going below 0.45. IRCB too.

9.50 pm : KLCI so bullish, thanks to Sime, Genting, Maybank, CIMB ... more investors collecting these counters? WHY?

Second liners are doing not good as many breaking supports in downtrends. My scanner shown 26 oversold stocks in KLSE at the moment. JCY .... hmm ... new lows everyday.

Hai-O : Broken 3.25 strong support. I hv cleared it 3.40+ recently(bought at 3.25 support level) Closed at 3.14, sitting at the next support. Looking at 2.50 level as market corrects soon? This is a good stock to accumulate when market dives.





TEH

Sunday, August 29, 2010

Sunday : Koo and Tan in final for the world championship. Hopefully theye could win this one today.

Property : Landed vs Apartments

I have been surverying some housing area with intention to buy one. Last wee I went to Suajan Putra, a new housing area developed by LBS. Today, I went viewing at Subang Airport area such as Subang Bestari. Next week will be Klang ... Kampung Jawa area ... that is what I m doing during Sundays ... hunting for a landed single-storey property. It must be below RM200k for a lowe income salary-earner like me. If possible, with a built-in kitchen cabinets and not in deporable situation(as I wont hv the money to pay for any renovations or repairs)

It wont be easy to find a house below RM200k(below RM150k, if possible) which near Subang Jaya ... Puchong and Klang are some alternatives. New houses will NOT be cheap anymore. So, I have limited choices but to look into a still reasonable priced area like Klang. Many travelling from klang to KL to work, anyway. So, from Klang to Subang Jaya is just half the way!!

Dr M : Dinner at Alexis, Garden Mall

I have dinner there just now with family and we saw Dr M and his family bula-puasa there!! Marina was there too but didnt see his sons. I have wanted to take a picture with him. Anyway, it is nice to meet him in person again(the last time was years ago) as I respect him highly for his abilities to bring Malaysia into the world map! He is still very strong and sharp. Hats off, Cr M.

TEH

Saturday, August 28, 2010

DOW up 160 points. No buying ... except JCY at 0.90, 0.80 ... and all the way down? Also EAH at 0.45 or below. I will have to trim TopGlove as I do not expect rubber to rebound any soon. How bout JCY, EAH and A123? Well these are new stocks in new low ... cheap can go cheaper, I know. So, I need to prepare for that and hopefully could be able to average down at each level I placed.

JCY : Every 10cents down, add 2k units. I have started at 1.35 but cut it off for RM1k+ loss. Now, I m collecting at 1.20, 1.10 and yesterday 1.00. I like it at o.88(rather than 0.90) ... so, my next buy should be at 0.88!! We dont know how low it could go, right? Any rebound(example - up to 1.10) of 5-10% will see me selling some and get ready to buy more at lower prices.

EAH : I have an average of 0.50 and will buy more at 0.45 at the moment lower my average. And might continue to buy at 0.40? I m holding 32k units of it now. Every one cent = plus or minus Rm320. So, I hv paper loss around RM1k now. I dont know ... we shall see how deep it could go but I m not cutting losses as that is not in my plan for her. I will galdly to clear some if there is a jump again. I have cleared half at 0.55 recently before kept buying from 0.53 and lower. Could it do a stunt to 0.55 again? If it goes SHARPly in a day again will see me clear half(again) while ready to collect when it retraces. It will ...?

TopGlove : I have to trim this one as I have lack of funds ... hence, if I want to buy at RM5 or below, I need to take small loss now. Well, I hv average at 6.30, i think.

A123 : BOught at a 'high' USD10.50, I m still waiting for next level to average down. Currently green-stocks in US is being rubbished. Many in new lows now. A123 is a 'new' stock listed and from USD20 dived to USD10, will it go to USD5 or even USD2 when US market dives? I do hope I have enough bullets to shoot it till end of next year. I dont see any rebound soon in this sector but I do believe these green-stories are cyclical.

ZhongWang : It is at new low now but I m being careful about my entry. If I dont have enough funds as my waterfalls falling sharply too soon, I have to clear all my TopGlove as I believe ZhongWang will rebound better. But, I m waiting for HSI to dive .... and once DOW gives way, it will. How low ZhongWang could go?

Why ZhongWang? It satisfied almost all my INVESTMENT criteria and also trading at its NEW low. So, it is good technically ... oversold. It is matter of WHEN I should move in for my first bite. Please do your own research IF you want to buy into this WATERFALL. I will show the chart and you will be scared!! Well, to me ... I should BUY when I m in fear. I m in fear for JCY, EAH and A123 at the moment. I have to use different strategies on each of them. I do not feel the fear for TopGlove yet. So, TopGlove will be trimmed or clear soon to collect my bullets, preparing for the worst. I have been weighing between TopGlove and ZhongWang and decided to go for the latter. ZhongWang's P/E is at single digit now.

Yes, I have cleared most my my trades. Many with losses. I could not afford to diversify if I m to average down. I have to focus only in a few. Even only the 4 mentioned above, I have handful to handle!! And I have to be discipline NOT to punt in any other stocks except for day-trading or contra, which I m feeling it is unsafe at the moment.

CitiBank

Many in Malaysia buying into CitiBank. To be honest, if you are a real investor, you will not buy into it. Fundamentally flawed but too large to fail kinda case. Provided the US gov to bail it out and guaranteed that she is safe, many may lose large amount of money here. Now, why so many buying into CitiBank? It is CHEAP(stock price, not valuations) with high expectation of appreciation of stock price(currently at USD3.70). Say you are going to BUY a financial stock, will you consider CitiBank? Why? Any other reasons besides what I have written above? Because some guru saying buying Citibank is sure way of profitting?

WaSeong : At 2.00, trading at its strong support with extremely oversold(RSI 19.4). On 26th May, RSI14 went to lowest level at 15.7(since the 2008 Nov). So, if we are going for counter-trend, personally I like it at RSI14 at historical low, and trading at strong support. The reason is obvious - a lower probability of another sell down(a hammer on Monday will see me BUY for short term rebound) and a higher probability of its rebounding. This is for short-term contra play, if I want to play on contra basis.



Efficient : Going into oversold level again. At 0.185, I will like to start collecting at 0.180 level, then 0.175 and 0.170 level. then ... WAIT. I have traded it in this manner twice and successfully released it in when it shot above 0.20-0.22. Recently, I went for short trade and cleared at 0.21 ... since then, it moving lower and at 0.185 now. Nice ... just do it!

Buying WaSeong or Efficient on Monday, employing different strategies. Many stocks re-acts differently ... so, it will be good if we have stalk over a period of time and more confident to trade it using what we believe works. What work for stock ABC is not true for XYZ. I have so long list of stalk-list ... and I do categorise them through their different characteritics. Yes, if you see ... I will mention about trading Wahseong or Efficient and I have traded them before. I do not talk about Sinotop, Timecom or even KNM. Definitely LCL is out of my list(out since the founder threw his stock!). PN17 is a NO NO to me. I dont care what high profits must take high risk as some put it. We have different risk appetite and risk management.

I have less than 3 years in markets. I m giving myself to develop and apply the knowledge I acquiring ... FA or TA or mixture of it. If I could play a spinner-hook(a spinner who has slight hook due to early release of his thumb) and get strikes after strikes, I wont mind mixing it. Bottom line : A good consistent score.

Patience is something very elusive ... I m slowly focusing into a few stocks to trade, using methods that suitable(which making senses to me - buying SAAG now at 0.065 doesnt make sense to me, so I wont even mention it) ... I need to feel comfortable. Learning to focus is also very important. We could over-diversifying. That was one of my weakness. So many stocks to buy, so little money.

To trade less too ... that is one of my weakness I m pointing out. Over-trading. So, I will buy or sell less unless it trigger my buy or sell signals. As different stocks act and re-act differently, I m buying many at its oversold level, with diffrent time frame.

Wish me luck as I might be accumulating a wrong waterfall and could never live in market to see the next trading year. By then, this blog should STOP.

Happy weekend. Happy Merdeka, my beloved Malaysia.

TEH

Friday, August 27, 2010

DOW is flat. APWR(windpower stock) is at its new low ... at 6.20 now, touched 6.06. I was scanning for oversold HKSE's stocks ... and the list increased significantly. There are 230 counters in HKSE which are oversold now!! Got bullets to shoot ... I have to look into ONE and chosen the great waterfall ZhongWang(code : 1333.hk).

Lee Chong Wei lost to Taufik Hidayat.

TEH
DOW down by 70 points ... KLCI still uptrend. Time to trim more?

JCY : At new low everyday, at 1.07 now. Watching Notion too ... at 1.70.

WahSeong : At 2.10 ... I m watching 2.05 now but lack of funds to grab this one. It is nice now.

9.20 am : KLCI down 5 points. BJRetail doing badly after listed. At 0.41 now ... a buy at 0.40? I did not check on Focus-Point as there is no point to focus on it.

CIMB : At 7.75 ... I seldom write about her but she is KLCI closest link. It went to RM8 recently. One huge growing bank in Malaysia, with Najib's adik boleh too spirit. as INVESTOR, it will be good to collect this one(somehow I prefer CIMB than Maybank) when market is to dive? At 7.75 today ... wait for RM7, ok? Are you saying it is not possible to see it at RM7? I m thinking of RM6 or below, actually.

WahSeong at 2.05 now ... when can I move in? Arrghh ... wait wait ... check out why it dives first?!

JCY : At 1.05, as JCY moving lower, I hv to forget about WahSeong.

JCY : Grabbed more at 1.05 ... crazy?

Hai-O : At 3.23 ... lost another 7 cents.

10.25 am :Today is OFF for Selangor ... but I need to go for tuition classes now. I hope I will have MORE tuition classes, to collect more bullet to shoot into market and becoming loooong term investor!

Notion : At 1.68 ... wait?

3.10 pm : Hey JCY ... what's up? It is at 1.01 now, queueing for 1.00 done. Amazing waterfall ... it is going into penny-stock now. Oh boy ... is it buy or bye? I dont know, I m queueing at 0.98 and 0.95? Done today??!

YJ : Markets do not make senses, actually. I have pondered on that question many of times and read enough to realise about HUMAN psychology in play. Adding SYNDICATES in play, couple with gov-linked funds supporting some counters, it is difficult to INVEST in KLSE using senses. Perhaps, the 6th sense is needed? I will like to elaborate on these.

JCY : It doesnt make any sense to me that it is trading at RM1 now. Well, perhaps the insiders knew that the CEO is running to Taiwan soon? We dont know what is playing behind. ANYONE selling at its nes low of RM1 is LOSING money. Tell me, does it make sense that I m glad to get its IPO at RM1.60, jumped up happily when it went up to RM2(and boasting to others how lucky you were to get JCY's IPO) ... only to see it is losing 50% now from its peak? The same person is in grief now, shaking his head and trying to avoid others(whom he boasted to) ... dont know what he should do now? CUTTING it off will be too hard to do ... but but ... what if it goes to 80cents? That is half the IPO value. OUCH.

Kossan : Sold Supermax yesterday for her but cleared today. Breakeven. Why sell? Needs more funds for JCY than expected?

Unisem : Cleared before closing today for some losses. RM200+ losses is not small for me, ok?

7.30 pm : KLCI at 1411 ... what a stunt. Sime and Maybank helped KLCI to move higher as CIMB is not being well today. Dont worry, they take turns to support KLCI, so on Monday CIMB sure BOLEH. After Merdeka, what's next? Time to get merdeka from our holdings?! As long as my stocks remain at oversold region, I will not clear them. So, I will hold on to JCY and EAH and may trim TopGlove(while waitinf at RM5). There are MANY nice waterfalls, actually. I hope market will dive in NOV, giving me time to collect more bullets to shoot.

ZhongWang touched a new historical low today. This is also a non-performing IPO(like my JCY and A123) ... but I m stalking it to move in when DOW and HSI dive ... next month? Now, when I m buying this waterfall, I m placing at least 3-6 months time frame. No fast profit ... important thing is to go against the herds - against the tide and hang on there. DO not get drown.

So, JCY, A123 and ZhongWang will be loooong term holding. These will rebound when market sentiments are better, unless they could not survive and tutup gerai.

TEH

Thursday, August 26, 2010

Bowling and Trading

My bowling scores today is impressive. I was very focused and could execute my shots well, with bit of changes in my usual lines. As the oiling(long oil) is suitable for my play, I made little adjustment to my target line and control my pace well. All these minor adjustments could NOT be seen and also to novices, they may not be able to appreciate the slight changes made. The result? Impressive, showing my adjustments were 'right'. And employing a right strategy to play extremely well. All these are work of MENTAL. Bowling is a mental game ... and many may thought it is physical!! My left leg is very tired now. Well, many may thought that bowling is using hands!! See what I mean about experiences, knowledge and applied mental strength?

My scores in lane 41 and 42 : 215, 215, 193, 245, 227, 220.

This is the best scores registered in KL so far. Every week, normally I will play around 195 average. Today I was quite confident and obviously know what I m doing.

But, I miss one spare(pin 7) in the six games - 2 unmakable splits with 1 baby split(converted). The best game was 245 with 8 strikes in that game. Others full with doubles and turkeys.

Those are just 'normal' terms bowlers used. Merely 5 years ago, I could not be so good as I tend to miss some simple spares!! Playing a straight ball, sparing is vital part of the game to consistently maintaining my scores.

Today, I could use house-shoe and house-ball ... I could still play 170, at least. Just place the ball, I should get all my spares done.

I see I m still in novice stage when it comes to markets. I may want to acquire the knowledge ... but I still need years of experiences.!!

TEH
DOW done a stunt ... managed to climb back to green territory. And A123 formed a hammer, closed at 6.84, 4.6% higher after touching 6.32, its new low. Wow. Buying at 6.32 could give us almost 10% profits in a day! How many stocks recovered from the red-battle field?

So, do you think KLSE could recover later after lost 8.8 points yesterday? We shall watch ...

Rubber : Supermax, Kossan and Adventa shown a 'hammer' yesterday, and I think they will rebound later. Adventa's RSI at 22, Kossan's at 23 and Supermax at 26 .... in that order. As for investors, valuations should be in this order : Kossan, Supermax and Adventa.

Tech : Notion and JCY at their lows. Notion's RSI at 21 and JCY's at 26. JCY formed a spinning top candle stick at its bottom. What does that mean? Hmm ...

9.25 am : KLCI still below 1400. WaSeong down 7 cents now.

KPJ : At 3.38 .. wait?

10.15 am : Supermax at 5.13 now, clearing some at 5.15 for 20cents profit. Looking into Kossan and Adventa. TopGlove is for investment.

10.25 am : Cleared some Supermax at 5.12 moments ago as I want to focus on TopGlove and JCY. Will clear all of Supermax today for a short contra trade. Eyeing at Efficient, now at 0.185, queueing at 0.180.

3.05 pm : Supermax at 5.16 now, see can reach 5.20 for me to clear all. JCY and Unisem not doing well and EAH is badly hammered(at 0.46 now). TopGlove is leading the slight rebound in rubber.

Notion : I dont have the funds anymore to shoot this one, trading at its new low. terrible rubbish-sector, indeed.

4.10 pm : Supermax cleared all at 5.20 done moments ago. Bye bye babe. Kossan is lacking TopGlove and Supermax which up 2% + now, so Kossan is my target!! Arrghh ... relax, too greedy liao. Look at JCY ... at 1.08 now, still many selling leh.

Unisem : Grabbed another 1k units at RM2.00. So, what is my average now? Need at least 2.07 + to breakeven, so far.

EAH : Queueing at 0.45. Hmm ...

Laggards : As TopGlove leading SUpermax and Harta to go up 3% now - either you jump wagon or look for laggard. IF the rubber continues to rebound for the coming few days(I will be glad to clear my TopGlove too), these laggards will move too ... in tandem. These are sector-play. Kossan, Adventa and Latexx are lagging now.

Supermax : Up to 5.28 now ... hai yah, cleared EARLY again?? Today, technically it is a BUY. Need confirmation ma - but I took the risk to buy at support 4.95 yesterday!! So, shouldnt sell today as those TA people will come here and buy ... should add more and sell higher to them? Never mind, still got TopGlove to sell to them.

Supermax at 5.32 now ... Topglove at 6.29, losing behind her now.

Kossan : Grabbed at 3.40 ... releasing Supermax in order to catch this laggard. I played 'laggard' trading few times before. The success rate is quite good.

Adventa : I want to follow too ... moving too. Up 2%, still lagging behind. Kossan sounds safer!!

WahSeong : I just mentioned her in my chat-box a day ago ... today its dives. Sorry-la, I dont mean it la. Why you jump into the red sea? At 2.11 now - stalk to BUY soon.

5.10 pm : KLCi up 11 points. MERDEKA. MERDEKA.

TopGlove closed at 6.25 but Supermax at 6.34. WHY I cleared her I m also not clear?! Kossan at 3.46, hope I could HOLD till it drops again?

Stock to watch : WahSeong, DRB, GPacket,LionInd and MAS. Add in my "E"s - Efficient, EPMB, E&O and EAH.

YJ : I have not really hold a stock for too long, anyway. I m NOT a looong term investor. That is just a joke la. Yes, if too looong and stuck there, IF there are better opportunities, I will CUT it off. Serious. At the moment, I cant see any value in most of the stocks except for those abandoned ones like rubber or tech stocks. IF USD is the main excuse being used, good. USD will rebound. KLSE is overbought, so I DO NOT want to buy any except good stocks in abandoned sector. By doing so, I m getting myself ready IF these stocks are to fall futher. The chances of ... say, GENTING to dive is much higher than TopGlove at this point of time. Markets are calculating probabilities, right?

So, my firm belief : KLSE is overbought - WILL correct anytime soon. USD is at low, and will rebound soon. Gold to move high with crude oil going lower. Rubber-stocks will rebound(but not rally in bearish market) and tech-stock will do well by end of this year. I m working hard to collect more bullets to shoot into these two sectors.

So, I m contrarian - and turning back into my 'fundamental' investor mindset. I do still have 'extra' to shoot for short trades(example : Supermax - buy yesterday, sell today).

Be patient is my policy now ... it is not easy being a trader like me. Doing nothing with market is difficult!! Example : I m seeing WaSeong dives today, I stalk it and want it at 2.05 again!! Wow. That is the problem with novices - lack of discipline.

Now, I hope I have cleared my points - market OVERBOUGHT. Merdeka is near ... you dont wish to be in market in Sept-Oct, right? Tell me la ... what opportunities are there in market now? I could only see many speculative counters around. LCL, Farlim, Ogawa, KNM etc etc ... not in my list at all as I need to sleep well at nights! Haha. SERIOUSLY, we need to know which one has HIGHER probabilities to rebound. LCL couldnt be compared to Supermax or even LionInd in trades. I will trade them VERY differently. What is the point I learnt so many strategies, right? Trading Ogawa and Jaks using different mindset ... comparing to buying Efficient now. Hard to explain ...

I m out of HKSE at the moment ... as I believe US markets will correct soon ... and global markets will be affected. Currently there are many good opportunities seen in HKSE, NOT KLSE. KLSE is artificially supported(due to Malaysi's boleh good economic data?) ... and I m searching for VALUES in KLSE. It is indeed expensive comparing to the huge upside in HKSE.

Ok, points taken. Thanks for your concern on my waterfalls. I will have two weeks off for Raya holiday. care for a drink?

TEH

Wednesday, August 25, 2010

DOW touched a low at 9937, back 100 points now to 10, 037. A123 at 6.45, with 6.32 as its new low. STP rebounds from a new low of 7.53 to 7.83 now!! Green now .. forming a white hammer!!

TEH
My Waterfalls

A123 : At new low everyday ... at 6.32 now, a new historical low.

"Nothing can be more slippery in investing than trying to buy that which is hated. At the same time, finding value in unloved places can lead to an exceptional investment. For the record, Mr. Market usually gets it right: an out-of-favor stock usually deserves to be there. Nevertheless, it's worth the time to explore such opportunities, since it takes little time to decide whether to abandon the idea or really start digging in."

Patience And Due Diligence

No matter the investment idea or how compelling it may seem, patience is often necessary for out-of favour stocks. Yet patience can only be attained when one has a firm understanding of the business and will not likely be flustered at the first sign of trouble.

Taken from : Investopedia



TopGlove : Closed at 6.06, touched 6.00. RSI at 37. Wait.



Unisem : Closed at 2.01, touched the support at 1.95 today. I was focusing on Supermax and I didnt queue for it as I m waiting for it low at 1.88.

:


JCY : Terrible ... JCY touched NEW low at 1.08. You may ignore the 1.08 as some 'market jerks' playing with it. My queues of 1.05-1.08 not done. It managed to closed at 1.10. I cleared half at 1.22 just days ago, you know. Well, I DO NOT know it will move to 1.10(otherwise I would have cleared ALL at 1.22, right?). But I m ready to collect at lower price which I bought yesterday at 1.12-1.14. What's next? Clear for losses or be looong term investor? What am I waiting? Hmm ... USD to rebound? Suddenly HDD sales shoot up 100% the next quarter? Hmm ... interesting to see what lies ahead for JCY ... an abandoned new KLSE's babe. Poor babe ... never mind, come to me, I shall take u in.




EAH : Closed at 0.470, broken support at 0.480. Bought more at 0.465 today. Other queues at 0.46, 0.455 and 0.45 not done. I m having huge positions in this one now. Yes, I no longer diversifying much ... and trying to focus in few - collecting this one. Each time 10% up, it is a SELL and collect at lower prices again. RSI at 29.


Supermax : Closed at 5.07. RSI 23. Support at 4.95. Bought at 4.96 today. If moving higher, sell. If moving lower, collect and be loooong term investor!


TEH
DOW down 130 points. Crude oil at 71. Gold 1230. Will KLSE in red too today? I believe HKSE will be in red ... still waiting for that dive?


Lost by ColdPlay (CP)



Just because I'm losing
Doesn't mean I'm lost
Doesn't mean I'll stop
Doesn't mean I'm across

Just because I'm hurting
Doesn't mean I'm hurt
Doesn't mean I didn't get what I deserved
No better and no worse

I just got lost!
Every river that I tried to cross
Every door I ever tried was locked
Oh and I'm just waiting til the shine wears off

You might be a big fish
In a little pond
Doesn't mean you've won
'Cause along may come
A bigger one

And you'll be lost!
Every river that you tried to cross
Every gun you ever held went off
Oh and I'm just waiting til the firing's stopped
Oh and I'm just waiting til the shine wears off

[Jay-Z]
Yeah
...just waitin' til the... the... yeah
Aha, I gotcha, uh...
With the same sword they knight you, they gon' good night you with
Shit, that's only half if they like you
That ain't even the half what they might do
Don't believe me, ask Michael
See Martin, see Malcolm
See Biggie, see Pac, see success and its outcome
See Jesus, see Judas
See Caesar, see Brutus, see success is like suicide
Suicide, it's a suicide
If you succeed, prepare to be crucified
Media meddles, niggas sue you, you settle
Every step you take, they remind you you're ghetto
So it's tough being Bobby Brown
To be Bobby then, you have to be Bobby now
And the question is, "Is to have had and lost
Better than not having at all?"
Because I'm...

[Chris]
Oh and I'm just waiting til the shine wears off
Oh and I'm just waiting til the shine wears off



Kossan : RSI 25, at RM3.45 now. Is it a bargain? I have to focus on TopGlove as I think rubber-stocks will see further selling pressure. So, if you are an investor, it is time to get ready to buy these good stocks which being neglected and dumped. Kossan is one good and cheaper stock(valuation wise) compared to its peers like TopGlove or Supermax.

TopGlove : Could I get more at RM5? I will not do anything until it moves another leg-down. Then, I will trying to see at what level should I collect again? This is called average-down, which is NOT for traders. If I m buying at RM6 now, I will definitely be glad to buy at RM5 ... and if market collapses, be ready at RM4, RM3 ... err ... TopGlove at RM2?

9.50 am : KLCI down 3 points. Supermax is diving low. I will like it NOW. But still be patient?

SPSetia-wb : At 0.515, I hope my friend has sold for huge profits at 0.58? It will be going below 0.50 soon.

KPJ : At 3.42, its warrant moving opposite direction? Will check its chart tonight.

Unisem : At 1.96, so ... buying more at 1.88?

SEG-wa : At 1.40. Will place it in my warrant list tonight. SEG at 2.40 now.

EAH : At 0.475, I have average at 0.51 now as I have cleared at 0.55, and bought at 0.53-0.49. At 0.475, time to buy more at 0.450!! Queueing now.

JCY : As I was collecting at 1.11-1.13 yesterday, it stays at this level now. Wont mind clearing at 1.20 level again while looking at below 1.10 to BUY more. 1.10 is its HISTORICAL low. Well, it has very short history in market, anyway. Hehe.

Hevea : At 0.62 ... welcome back down. Going into the 50-cent group? Then, I will add u in my liking of 50cent group, ya.

BJCorp : Trading at RM1 again, touched 0.995. This is a STRONG support. The last time it touched 0.995, it jumped to RM1.10+ for 10% jump in one week, ok? History repeating? WARNING - a break of RM1 support is likely now, and it will DIVE further. BJCorp is NOT a good stock for investors, ok?

BJRetail : Newly listed, no longer 50-cent group ... at 0.440. I remembered The Edge written about it and said its IPO was HIGHLY valued. Well, dont know who subscribe to it. IPO NO LONGER a so-called sure bet, ok? Many new IPOs are below their listing value. Can you name 5 in KLSE, please?

HaiO : At 3.32 ... a good stock to stalk. I just sold it at 3.44 last week. Need to check its chart again tonight.

10.55 am : Announcing that Supermax going below RM5, queueing at 4.94, its strong support level. DARE enough to be stupid? Hmm ...

Supermax : Welcome back, babe. Nibble at 4.96 done. More to come if this babe diving again ... be ready to catch a knife? Wait wait ... are you are investor or trader? Need to decide that before BUYING now. It is clearly STUPID for traders to buy as it will form another BLACK LONG candle-stick today. Err ... I want to hold it ... forever? Haha ... hmm, I m jovial mood as I hv been waiting for Supermax at 4.95 days ago. Last week when I speak about 4.95, many might think that is not possible as it was at 5.50 level!! OUCH.

11.10 am : As I was writing the lines above, Supermax done at 4.95. Well, 4.94 is not done yet. Wait.

11.55 am : Announcing JCY breaking 1.10 soon ... queueing at 1.08-1.05. I m in fear - and I told myself to BUY more when in fear!! A contrarian investor or pure stupidity?

IJMLand : At 2.28 ... waiting for 2.05 again?

MPHB : At 2.07 ... nice.

Resorts : At 2.94 ... when do u buy her? At 3.14 or 2.74? At 2.94 now is the mid-point now. Dollar-averaging will give us a lower average. Time to sell? Nope ... selling was at 3.10, actually. But ... again, who knows, it might jump to 3.30!! Hmm ... it was OVERBOUGHT, ok? Tell me, will you jump into to buy Genting at RM9 now??

I m LOST ... and confused!! WHEN do we actually should buy a stock? When it DIVES and NO ONE want part of it OR when it shoot higher and everybody talking about it? HELP needed!! When should I buy a rubber-stock(say I m in love with the sector)? When it moves from RM1 to RM5 or retracing from RM10 to RM5? Arrrrghhh ... market is stressful play. Have kit-kat, on me.

AirAsia was at 1.40-1.50 level, ok? Today it is at 1.70 and people speaking about its LOW valuation of sudden? Hey, AirAsia was at 1.25 when it was forming a waterfall and I was stalking her, ok? Wait ... I took small profits from that trade. It was at 1.40, ok? If I BUY into AirAsia at 1.70, I feel so stupid(like I bought Gamuda and released it yesterday).

2.05 pm : KLCI down 5 points, trying to hold to 1400 level. Time to short FKLI as KLCI will be retracing after running so high(on drugs?). And those overbought counters will be badly hurt in coming weeks. That is my belief(I m wrong most of the time, by doing the opposite, you should be OK) ... coming Sept-Oct, I will like to clear many if there is any 'small' rebound ... take a rest, while shorting KLCI. It is about time ...

Sunway : At 1.57 now, when I was yelling a buy at 1.60 weeks ago in CN's meeting ... I dont think so anyone bothered. It went to 1.68, and retracing in fast pace now. I cleared my Sunway-wc too early at 0.58, it went 0.62. Today, it is at 0.570. Will look into it again when Sunway-wc at 0.50, my 50cent group!!

Warrants : Another 50cents warrants I like are SPSetia-wb, AnnJoo-wb, Glomac-wa,Fajar-wa and WCT-wb.

3.30 pm : KLCI down 8 points. Dont worry ... some invisible hands will support it and artificially push it into green again later? Hmm ... Malaysia BOLEH spirit, ok?

XinQuan : At 1.40 now, lost 13cents or 8.5% today. ... shoes are dropping? Mind you, it shot from 1.40 to 1.90 in two weeks!! Today, it is back to 1.40. Dont know why suddenly many investors so interested with China shoe-stocks. Oooppsss ... they are NOT investors, they are traders, of coz. Silly me. Then, as some late-comers bought into these shoe-stocks, now get stucked. CUT LOSS or else traders turn investors??

EAH : Bought more at 0.465 done, still waiting at 0.45. OUCH!!

Scomi : At 0.39 ... hmm ... nice. WAIT.

Jaks : At 0.685 ... hmm ... nice. WAIT.

GPacket touched 0.88? At 0.895 now ... WAIT.

4.05 am : Supermax reaching 5.10? I m clearing some at 5.12. Will keep some as hammer might be formed later.

Efficient : At 0.185 now, I was queueing for it at 0.19 days ago. So, I will be glad to start my collection at 0.180 tmr?

Oversold stocks

1. 3A
2. Alam
3. CSCSteel
4. E&O
5. GPacket
6. IJM
7. Jaks
8. JCY
9. Kossan
10. KPJ
11. Landmark
12. Latexx
13. LonBis
14. MAA
15. Magna
16. MediaC
17. MEGB
18. MRCB
19. Muhibbah
20. Notion
21. Nylex
22. Perisai
23. Petra
24. PPB
25. Supermax
26. Tebrau
27. Timecom

So, the list is longer now than what I listed last week or two ago. Many above I like ... but I think except for the lousy tech and rubber sectors, all still doing fine? When markets correct further, the list will be too long for me to list it ... so, I will only short-list those I like.

NEXT TUESDAY is the MERDEKA day. That should be the day merdeka from our stocks too?

TEH

Tuesday, August 24, 2010

10.45 pm : DOW down 130 points now, trying to hold to 10,000 level. May not be long when markets start to correct ... time to GET OUT of KLSE with whatever profits you gained with your OVERBOUGHT stocks. So many overbought 'blue chips', scary leh ... and many broken support levels today. A123 at 6.60, and will only top-up when market dives.

TEH
DOW down a little. A123 climbed up from its low at 6.51 to close at 6.80, forming a black hammer. Time to buy?

Rubber stocks

Adventa : At 2.63, RSI at 25. Next support at RM2.40.

Kossan : At 3.60, RSI at 32. Next support at RM3.40.

Latexx : At 3.36, RSI at 32.

Supermax : Closed at 5.50. RSI at 32 too. Next support at RM4.95. P/E 14.

TopGlove : Closed at 6.06. RSI at 34. Next support at RM6.95. P/E 21.

8.50 am : I bought two books from MegaMall's MPH yesterday - Infinite Wealth and Warrant. I will be using these two to look into YTLPower-wb and KPJ-wa. Re-learning what I thought I knew but actually I might not.

10.05 am : JCY interestingly at 1.13, I m queueing at 1.10. Will it be done today? Low will go lower ... tell it to my A123. Hmm ...

JCY : Moving to 1.12 now, so clearing at 1.22 last week was a 'good' decision? I hv only cleared half for Unisem(which down too), so clearing ONLY half at 1.22 is a 'bad' decision(why not clear ALL?). This is a dilemma of traders ... no such thing as good or bad. Make money, good. Lose money, bad. It that so? So, IS BUYING 1.12 at the moment is GOOD or BAD? Yes, we need to speak about what is expected in FUTURE ... but can ones really predict? Logically, being an INVESTOR, we should look into weakness to BUY and clear it when we registered some profits and it shows reversing again? HOW do we tell?

IJMLand : I want to write about this - which I missed the boat - when I wrote about it 2 weeks ago, and when I saw it in CN's forum, it is already UP ... can really buy when move up? Are you sure? It is at 2.38 now and going into profit-taking soon. If the time frame is too short - we could be buying and selling in daily basis!!

KPJ-wa : AT 1.73 now, refused to move to 1.70 anymore? Time to collect?

JCY : Grabbed at 1.12 and 1.13 done. Waiting at 1.11 and 1.10.

Unisem : AT 2.02, wait for 1.95

SL : I hope you have cleared your SPSetia-wb at 0.580 that I told you as the target. Bought at 0.42, when SP rallied, it is TIME to SELL. Today, it is down ... at 0.53 now. Warrants are meant to TRADE, ya. IF you have sold it at 0.580(it touched 0.59, I know), can I have a nice free-dinner, please? Hehe.



Are you a trader or investor?

Many DO NOT know if they are traders or investors. I m one of them!! Haha. Generally, we will think that INVESTORS using a longer time frame and traders a longer one. Well, that is only partially correct, in my opinion. A trader could be a 'longer term' trader as his babes keep running higher and no selling signal seen(as he is using longer time frame). He could be misunderstood that he is an investor!! As for investors, he should only be buying when market collapse!! WHAT?? Crazy meh ... markets collapse, you buy. Well, that is for investors.

Now, I need to point that many are actually TRADERS. They bought into a stock due to a piece of news or 'hot-tips' or recommended by broker houses/ remisiers ... well, for a quick profit, actually. BUT ... when market turn around, they got stucked and becoming INVESTORS!! Instead of being glad that he could buy MORE at cheaper rate, he get nervous and cut it off when the pain(of losing) is unbearable!! Ever have such experiences? I DID ... many times, indeed. This short-term punters or traders becoming a loooong term investor!!

Example : LCL got many badly burnt. Please check on its chart ... you will be amazed WHY this is such a 'darling' of KLSE. Until the middle-east crisis, and founder thrown his holdings ... it was still a good hot stock!! WOW ... today, trading at 10-cent level, in PN17, it might NEVER recover or even de-listed. MANY who bought at RM1 or even 50-cents are BADly burnt. Do you know that MANY are still HOLDING to it, with a HOPE it will recover .... one day? Because I m a looonger term investor!! HEY, INVESTORS look into FA and good stocks to buy,ok? Since when LCL is a good fundamental stock? I still remember someone asked my advice on LCL which he bought at 0.50-0.60 level and tanked to 0.30 level ... I blogged it here and asked him to CUT. OUCH 50% losses? Dont worry, if you have cut it at 0.30, you will take your lucky star that you have CUT it off and trying to recover your wounds. WHY? It is at 10cent NOW.

So, what is the different between an investor and trader? Will investors leverage on warrants?

Most of us want to claim that we are investors and we will hold till ... till the stock de-listed!! Dont laugh, many are in such a painful situation. IGNORANCE is one of the main factor. You saw SinoTop flying 100% higher, you get excited and convinced that it is the STAR of KLSE in a making .... hey, that is NOT the mentality of INVESTORS even you could hold it for another 3 years ok??

INVESTORS look for 'value' in a stock. DO you know why rubber-stocks rallied for the whole one year and making 100-400% hike in their stock prices? DO YOU? When it comes to stock, this is SENTIMENT driven. H1N1 or WHATEVER reasons will be used for buying into a particular stock related to rubber. Even IRCB is considered as rubber stock!! How about Well-call or Luxchem?? Are they rubber-stocks too? Of coz we have Incken as the rubber play too?

Look ... stock market OVER-react to many extends. Rubber currently in correction mode as it has OVERSHOT its values. Nothing to do much about the H1N1, high Latex prices, weakening of USD vs MYR ... or whatever points the analysts trying to explain on why rubber-sector being rubberished at the moment. Technical analysts will say ... stay away from the rubber-stocks as it is DOWNTREND. And many more chartists pointing out many names to it ... such as 'mushroom of death', a new term I learnt from CN's forum. DIE la DIE la ... those INVESTORS selling their holdings?

3.30 pm : KLCI is flat.

Supermax is DIVING ... game over for rubber-stocks?


Investors are someone sitting in the fence waiting for retracements, corrections or collapse of the markets ... all of these in a go, if possible.

So, having said that ... are you sure you are an investor? Look at our beloved Supermax being oversold now, ans still being thrown away today. I get a little greedy but I will stay patient(I hope) and grab it at support!!

Kossan : AT 3.40 now, losing 5%.

5.10 pm : KLCI marked-up 2.62 points in last minute buying. I cleared Gamuda at 3.37 for JCY and ready for Supermax.

KLCI is overbought. Do u know what is that means? KLCI is artificially supported at the moment for MERDEKA day. Do you know why and how? Logically, take profits on those overbought counters. Do you know why? Are you loooong term investor? Sure?

There is some SELLING pressure exerted in Supermax, Kossan and Latexx today. IF you are an investor, will you be buying into a good sector which oversold in the background of our bullish KLSE? Are you waiting for a second-dip in markets? If you are a believer of double-dip and a loooong term inestor, of coz your SHOULD NOT be in markets now - sideline ... waiting for the expected dip, either another half year or a year or more, doesnt matter ... you have the TIME. Wait ... till it dives, then BUYING SPREE starts!!

Conclusion : There are VERY few investors in KLSE, majority are traders or 'lost' souls who dont know if they are investors or traders. "Lost" as they are in the majority of losing money to Mr Market. Dont worry, you are certainly not alone - if 90% of us on your side, will you feel better? We are all similar ... are we STILL going to do the same mistakes expecting different results!! That is called INSANE.


TEH

Monday, August 23, 2010

TOP 10 COMPANIES(by market cap as at Aug 20)

taken from The Star

1. Maybank
2. CIMB
3. Sime
4. PBBank
5. Maxis
6. MISC
7. Tenaga
8. Axiata
9. IOICorp
10. Genting

Selected

13. PPB
17. YTLPower
30. MAS
36. Parkson
37. BJToto
44. AirAsia
48. BStead
51. TopGlove
53. Oreint
57. Sapcres
60. IGB
61. IJMLand
64. Proton
65. Kencana
69. JCY
71. MPHB
72. DRBHCom
73. WCT
74. Dialog
81. KPJ
89. Mudajaya
93. WahSeong
97. TAGB
100. MahSing

TEH
Breaking Benjamin - So Cold



6.50 am : Will like to clear BStead and Gamuda, if possible. Will check if EAH will be moving again today. No topping-up JCY, Unisem and TopGlove just yet. KPJ still in focus. Scomi has been retracing nicely. Wait.

10.35 am : KLCI surging above 1400 now.

Finance : CIMB and MayBank are pulling KLCI to record high. There is also a rally in TA, OSK and HDBS. Well, high trading volumes seen for past 2-3 weeks, and speculators playing on these stocks?

Tech : Still flat without certain direction yet. Collecting JCY and Unisem and sit on them as INVESTOR will do.

Glove : TopGlove up a little, Supermax maintaing 5.50 level. I will only look into BUYING again if they could DIVE further. I m holding 2k of TopGlove at 6.30 level average now. So, it is not cutting losses on her, it is BUY more at lower price or we called in avergae down. TRADERS should not average down, but cut small losses. I m not trading it. I started to fall in love with her? Hmm ... never love a stock!!

KPJ-wa : At 1.72 now. A good look into it at 1.70 or below.

KPJ : At 3.50, market cap stands at 1897mil. P.E at 7.1. Nice for investors?

Parkson : At 4.44 now, touched 4.41. I will like to grab some at 4.40, its support. PE at 10.50, and riding on retailing in China. This is for INVESTORS.

EAH : At 0.500 today, will only buy again at 0.48. Nope, I m not reading the chart or whatever candle-stick it is showing. It is accumulating at 0.50 and below for me.

Efficient : At 0.190, long queue and I m queueing too. This will be my third time collecting it below 0.20. I will buy more at 0.18 and 0.17. I doubt it will go below that ... otherwise, I wont mind averaging down at 0.16 or below. I m not sure if 0.19 will be done later. we shall see ...

EAH : At 0.490 ... grabbed some at 0.490. And queueing more at 0.48. The decision to SELL at 0.550 last Friday was a RIGHT one. Grabbing back at 0.490 is a discount of Friday's prices.

EAH : Bought more at 0.485 before closing.

BStead : Feeling so un-comfortable holding to an overbought counter, I released it for small loss. Fundamentally, I like this one VERY much now. I cleared it for more JCY again ... JCY closed at 1.15. Wait ... grab at 1.10?

EPMB : At 0.505, nice ... do go below 0.50 please. Thanks

AEON : Closed at 5.07, lost 13 cents!! Parkson is down too.

11.30 pm : DOW down a little but A123 in its lowest level, at 6.60 now!! Cut DEEP loss or top up? Will it ever recover? I shall wait ...

Are you an INVESTOR or TRADERS?



TEH

Sunday, August 22, 2010

EAH : Is that an inverted hammer? It touched 0.555, closed at 0.510. I have cleared half at 0.550 only to buy back at 0.53, 0.52 and 0.51. I m holding to it. Will only consider more at 0.48 and 0.45.

50 Cents club

P-I-M-P : One of the nice song by this foul-mouth 50 cent.








Other three members of 50-cent club that I like : EPMB, Perisai, KurAsia




LBS : At 0.520, RSI at 43. BUY at 0.510, support level.


Malton, Dufu, Scomimr, KUB, IRCB, KNM are the members.

TEH

13 technical trading systems and rules by Fred Tam

System #1. Simple Moving Average Crossover Method

BUY : Close > S.M.A(30)
SELL : Close < S.M.A(30)

Note : For longer term trader/investor, you may want to change the user-defined period to 50days or 100days. Otherwise, one may use 20days or even 10 days. The probability of 'failure' will be higher for shorter time frame but by using the longer time frame, one may have bought it 'too late' as it is a lagging indicator. System #1 stated here is the easiest to teach ANY novice and it is widely used by investors or someone who DO NOT trade much. Personally, I am using SMA(20).

System #2. The Dual SMA Crossover method

BUY : Shoter SMA > Longer SMA
SELL : Shoter SMA
Note : There were once(in 2-3 months) where I traded using only this system, but as I traded in a shorter time frame, I was using MA(5) and MA(20), if I m not mistaken. The success rate is quite OK but it still lags behind. A combination of system one and system two could be used for more conservative traders. For example, we may want to make sure it is trading above MA50(system #1) and then use the crossover of MA5-MA20. Again, the combination of system # and system #2 is commonly used. And it is easy to teach/coach anyone to use it. Those you want to learn to use the system #1 and system #2 may contact me, pay my dinner(I m a great eater, ok?) and I could explain these methods in half hour! hehe.

System #3 : Dual Exponential Moving Average Crossover Method

Note : Similar to the above but instead of using SMA, it is using EMA. Do not need to bother the difference as there is 'not much' for most of us. It is for Maths-geeks. I m NOT.

System #4 : Relative Strength Index (RSI-14)

BUY : RSI > 50
SELL : RSI <50

Note : I never use this one instead using it in a contrarian manner. As RSI moving below 30, it is considered as OVERSOLD technically. So, I will star to zoooom into those good stocks that in my stalk list and searching for oversold stock(s) to buy. The other way is also true ... when RSI moving above 70, it is said to be OVERBOUGHT technically. So, I will start to feel uncomfortable and will like to clear it ASAP. The gains may be less than I expected as I failed to hold-on to it(due to fear that it dives soon!!) and as I m buying oversold stock(s), I may need a longer time frame IF I m using RSI alone.

For example : Tech and rubber stocks are oversold at the moment. So, with contrarian mindset, I do like these sectors now. The only 'problem' might be .. which one should I choose from? Placing a longer time frame(3-6 months), I bought largely into JCY(recently cleared half to diversify into Unisem) and TopGlove(looking at Supermax too).

Personally, since I discovered RSI 2yrs plus ago(at the initial stage of my charts learning), it is one of the most commonly used indicator. And recently, after joining CN, using its charts, I am also using RSI-9 for 'quicker' indications(of overbought or oversold).


TopGlove : Next level of BUY at 5.50. I saw someone posted in CN's forum that TopGlove forming ascending triangle and a break below it current support at 5.95, I will like it at 5.50.

TEH

Saturday, August 21, 2010

Tech-index




JCY : At 1.17, will only BUY more when it rebounds and uptrending again.



Unisem : At 2.09, there will be a bullish crossover in stochastic soon, and the green histograms seen moving to zero-level. RSI(14) at 40-level. I m using 5MA(green), 10MA(red) and 20MA(blue). Also, shown is the RSI-9 for shorter terms trade. I have started to use RSI-9, as it will be moving faster than RSI14. So, it will give me an earlier signals of overbought/oversold. A vertical shown the bullish crossover of MA-5 and MA-10(short-term). Resistance at 2.10 and will only wait for breakout of this resistance level with high volume for my next BUY.

TEH
DOW down a little. A123 at 6.99, low at 6.89. STP at 8.18, low at 8.12. These are green-stocks(many more) at 52-week low. A123 at historical low since IPO'd.

2.45 pm : Lunch ... didnt go for CN meeting as I hv tuition the whole morning till now. Next week is the 'trial' exams, so students will be more concern only during exams.


Jaks : Stochastic in oversold region, support at 0.725, closed at 0.740. Looking at 0.78 as resistance and a breakout with high volume from this level permits an entry!! Frankly speaking, I wont mind buying on Monday to ride on the current bullish waves. As KLCI is in OVERBOUGHT region, correction will be here SOON. Be wary.





BStead : My newest entry at 4.31 as I have been waiting for the breakout from the 'flag'. Yes, I have wanted to write about it days ago. A pole(while candle-stick with high volume) seen, then followed by series of black-candles(profit-taking) with decreasing volumes, then breakout from that with high volumes!! Perfect 'flag' seen .... this is the first time I m trading using 'flag formation' and I m entering using TA, ok? It is at OVERBOUGHT level but technically it is considered as 'beautiful' breakout? Hmm ...

TEH

Friday, August 20, 2010


Creative Energy(8109.hk) : During the first day, it shot up so high, now retracing to new low at 1.06. Closed at 1.09 today. Now, look like EAH? Hmm ... perhaps they should not be too creative with energy efficiency here.

For more info - click HERE

This is a high-risk investment and traded in GEM. DO NOT buy anything written here. I m pointing out for edutainment purposes.


10.40 pm : DOW down. A123 touched new LOW at 6.90 ... everyday new low? How low will it go so that I can collect more?

TEH
Case study : EAH



EAH : Buy, hold or sell?

This is an IPO which shot for the sky in the first day. I do not look into it as many speculators and day-traders were playing with it. Then, obviously I was alerted when it formed a waterfall!! It was in my oversold stock and I started to read about it, to see if I could grab some. Dali's post helped(thanks Dali for the insight too). The next day after my readings, I posted the chart .. and it formed a long BLACK candle-stick on 3rd AUG. It came down from 0.55 till 0.48. I was collecting at 0.53 ... chasing it down to 0.48. OUCH. I was ready to buy more only at 0.45, its LOW. Since then, I didnt do anything about it ... keeping an eye and it touched 0.535 twice until today, it broken 0.535.

Tell me, should I sell or hold? Tell me ... or should I top-up? Mind you, I still have many waterfalls which falling on me at the moment!! Only EAH shoots up now. So, with that dilemma in mind, should one buy, hold or sell? I chosen to SELL ... and cleared some at 0.550. (now is 10.45am at 0.535 vs 0.540).

BUY : As it is technically moving above 0.535, its current immediate resistance, it is a BUY. High volume registered.

HOLD : If you have bought into it at higher prices or lower prices, will you continue to hold? It is interesting what is in ones mind.

SELL : If ones bought lower price, is it a sell? If you have entered at higher price, will it be a time to cut loss or HOPE it will move higher? Or are you an investor, believing in buy-n-hold?


Solar Stocks



STP : Closed at 8.48, breaking its strong support. Oversold as markets do not accept the clean-stocks in dirty markets. Many clean stocks are at its new 52-week low now. STP was at USD 15 level in April, and dived to USD8.50 level in 2 months!! As it rebounded to USD11, currently reality is back ... solar stocks are rubbish and many are losing money. Some might collapse and the sentiment is SELL SELL SELL. PE stands at 15 level now. The Nov 08 and Mac 09 low at USD5. Will you dare to buy into it at USD5 when US markets correct SOON? I hope I m ready ...

Green-stocks in US are having BAD times now. So, I m busy looking into these battered stocks. So many choices and I do not really know which one to choose from.

Besides green-sector, tech sector dealing with HDD is being thrown away too - Western Digital and Seagate are at their low .... look at JCY, ya.

In KLSE, the rubber-stocks and the tech-stocks are being battered. Well, to be fair, these two sectors have been shooting so much higher last year, and it is only 'right' that markets correct them. Whether they will rally again, I dont see it in nearest future. But, in weaknes, I just feel that we should be collecting those good stocks. The weakening of USD didnt help, either.

10.05 am : EAH moving today, time to THINK of selling. At 0.54 now. I m having quite a heavy positions in this one as I was collecting below 0.50. Will not top-up but let it runs ...

10.10 am : Cleared some EAH at 0.55. It touched 0.555. Queueing to clear at 0.59 and 0.62. IF all done, I m glad with the trade. Buying back at 0.53 - 0.50.

The "E"s that I like : EAH is a new entry besides E&O, EPMB and Efficient. I have added ENG as it is in tech-sector and doing well now.

4.55 pm : KLCI up 2.5 points and I grabbed BStead as it breaks 4.30. I sold some MAS at 2.17 for BStead. Follow the trend, as turtle said.

EAH : It is at 0.510. WOW ... my queues to grab back at 0.53, 0.52 and 0.51 were all done!! I m very surprised but I hv interesting points with my 'case study' of traders' emotions later(written in the morning when it shot up to 0.555 with huge volumes!!)


RULES in trading by Turtle

1. DO NOT OVERTRADE

2. DO NOT MISS A TREND

System One


BUY when it is at 4 week-high. BUY in 4-stages.

Example : I bought into Gamuda when it breaks its resistance at 3.36, and that was a 4-week high. I bought in 17th AUG and the last time it hit 3.36 was at 17July. Gamuda is in UPTREND and my only uptrending stock I m holding now, actually. Yup, I m testing out the system. At the moment, I only have 1k units of Gamuda as I m supposed to top-up as it moves higher, in 4 stages!! So, the total should be 4k units.

Now, it is at 3.36 .. becoming a support level, shouldnt I be buying my next 1k units? Or should I confirm the uptrend and to top-up later? What is the level should I clear all then? The reversal of the trend? How do I tell?


System Two

TEH

Thursday, August 19, 2010

Finding Consistency(page 230)

"The most important lessons in life are simple yet difficult to execute. In trading, consistency is the key. A systematic trading approach, a thorough understanding of the limitations of that approach, and the tools used to build trading systems can help you be more successful and constant. You must be consistent to trade well. You must be able to execute your plan or the plan has no meaning."

Excerpt taken from "Way of the Turtle"

This is what I was writing about my bowling game which I could be so consistent with my games - from the way I hold the ball, pre-shot routine .. to my release point and board targets. I could easily spare most of the cases, and play a consistent way. I know I m NOT consistent in my trading(YET) as I m still experimenting on my trades!! Is that purely excuses or I do actually learnt form those mistakes?

Being consistent also means to trade the WINNING way(s) and to plan the trades as one should be or comfortable with. And to execute the plans once it triggered(buy or sell in trading). CONSISTENCY is becoming my 'problem' now ... and I will need to address that soon and play my cards well. I need to get back my confidence before it ruins my whole systems. I need to IGNORE the CN's forum if I could not be discipline enough NOT to follow their stock-calls. I need to remind myself to be a contrarian ... stay in course of my trading ideas and beliefs.

As I believe rubber-stocks WILL recover, I should stick to it even tho some GURUs(or self proclaimed) saying all the doom situation about rubber-sector(BTW, USD vs MYR is at the lowest now ... 3.12, going to 3.10?)

I still thinking I should re-vamp my whole system as it jumbled up ever since I joined CN. Blame it on my lack of discipline. Blame it on my beliefs that they are 'gurus' and should guide us well.

By re-reading those investment or trading books, I noticed that I m committing more 'trading sins' for the past 3 months. I need to recognise the failures.

11.40 pm : DOW down 170 points. A123 touched it historical NEW low today at 7.12. I will be tempted to average down but this is new low ... so, I need to wait. For TA trading, I should have cut it loooong time ago. Just like JCY touching new low ...

Western Digital is another very tempting stock with PE single digit!!

TEH
DOW up a little. Crude oil stays at USD75. USD touched 3.14, at 3.15 now. IF MYR continues to strengthen(or USD continues to weaken), then rubber or tech companies could use it as a factor affecting their profit margins.

Jordan's 一句到尾



Today's alert

Supermax : This is a red alert to me now as it is oversold soon. Will queue 20 cents lower today.

JCY : I do not know if it is forming a flag but I do know that I cleared some at 1.22 days ago, it is at 1.16 now. Will queue at 1.14 or lower later.

BStead : This is another flag forming?

9.35 am : KLCI up another 2.5 points. Supermax and TopGlove in reds. Unisem too. I m queueing for Unisem, while waiting for Supermax and BStead.

11.25 am : IJMLand moving today(as expected?) as SPSetia leads.

Adventa : Still in reds today and Topglove losing her grounds ... at 6.10 now(touched 6.05).

Hai-O : Recovering well but I hv cleared mine. At 3.47 now.

KLCI is overbought ... things are very good now, sentiments are positive and many started to see KLCI at 1,400 now. Malaysia is going to celebrate their National Day, so certainly we wont see market to collapse before 31st Aug, right? CIMB is supporting the market today, up 4 points. It was Tanjong ... then Genting ... then GenM ... then Maxis ... now we have AMMB in the fray for together with MayBank. Even Sime with some 'crisis' are doing well. Notice Tenaga and Plus? They have been moving up steadyly.

We read about EPF disposing their stocks in early AUG. Who are the buyers? Must be those big fund managers having fun?

I was talking to one of my colleague(a retiree but continues her teaching here) who are in stock markets. She is an INVESTOR and bought into MayBank, AMMB and Public Bank in 2008 when market dives!! Wow ... and she has NOT selling any of her stock since then! And when I said KLCI is overbought, she, as investors will buy and hold. I guess she is gaining a lot now since market has recovered!!

Rubber : Using TA, rubber-stocks are rubbish ... I mean, rubberish. It is downtrending. SO, DO NOT buy into rubber now. It is only for those prepare to lose money.

8.10 pm : I m at Sunway pyramid, just finished my bowling game(every thu) ... and tho tired, I m casually played quite well : 192, 202, 197, 178, 195, 217. That is my 6 game scores for today using house-ball(as I did not go back home to get my bowling balls due to puasa-jam). I was sharing with my colleague-friend HOW I could casually play and beat any straight ball players(players average 180 and below) as I m VERY consistent with my strategies.

Before I played SO CONSISTENT(I could still use a house-ball and play another 6 games average 190 now) ... it took me YEARS to experiment!! It took me two years to CONSIDER taking up bowling seriously as a competitive sports - then it took me two years with a bowling club to NOT 'masuk longkang' and hit the HEAD PIN(#1) consistently with every first throw. And then, as my average improves from a 120-130 in the initial stage, it jumped to 150-170. To play better than that, I need to play more regularly and train harder, right? Learn the finer part of the game and trying to apply it in my game. Seriously, I WAS one of many novice bowlers who are 'searching' the right way of bowling.

In bowling, either you play 'hook' or 'spin'. Orang putih play hook until Taiwanese and Asians introduse spinners into world competitative tournaments and start winning!! Spiiner is much more CONSISTENT but if one train hard enough, hookers' score should do better. The main challenge : BE CONSISTENT.

As I do not have the time(and money) to train, I do not play spin or hook. I opted for a BORING yet SIMPLE straight ball ... well, it is lousy and wont beat those play spin/hook but ... I m VERY consistent in my straight ball that I could play 190 in ever game!! So, without much of practise, I could play a good game!! Who care if you could hook using 1st board(called crankers) or spin like a helicopter - bottom line : THE SCORE.

Now ... related that to stock markets : WHO cares if you are using the LATEST software - TA or FA - did you profit lots of money? NO .. i should ask, are you in the 10% minority who didnt LOSE money?

My colleague sharing about her 'stupid' buy n hold strategy struck me ... she bought AMMB at RM3, and I asked my ex-colleague LL to buy at that level too - but DID I BUY?

I was busy (and still am) experimenting on trading using different ways. I wonder how 'stupid; I am ... until I played bowling just now!!

Hey, I was doing that last time I learnt bowling, right? I was experimenting and many laughed at my 'stupidity'. I played hook and spin before too.

Next question : Shouldnt I be profitting from the huge rally in markets rather than experimenting(currently with my TA) and losing money? Stupid enough? I even experimented with theories and hypotheses!!

Today I wanted to write about FLAG and using BStead as example. I wanted to move into it and to see IF my theory on FLAG is right or wrong!! I did not after I spoken to my colleague!! So what u know what flag is ... she doesnt even watch markets, doesnt even know about charts. All she knows is MayBank at RM8 and it is not time to sell yet. I joked and asked her to tell me when she will be selling her MayBank as that will be the time I will run away from market!! Haha.

And I asked her about TopGlove ... she never heard of the counter!! I said ... oh, it is a rubber counter!! She replied ... I only look into BLUE CHIPS and large BANKS to invest. Also, I will only start buying when market collapsed!! Bravo ... a REAL investor, indeed. BTW, she just renovated her Subang Jaya house for RM200k(her house bought for RM320k). Yup, she is just a lecturer and giving tuition like me!! She said she benefitted most from 1997-1998 crash!! What a gutsy old lady!! Highly respected!!


TEH

Wednesday, August 18, 2010

Rubber : Worth a look or rubberished?

1. TopGlove : At 6.19. RSI 38.0. wait



2. Supermax : At 5.51. RSI at 31.4. The last time RSI below 30 was in Feb 2009. Wow. So, technically it is a BUY when RSI below 25? Let us see the chart above.

Technically ; BEARISH. MACD lines going below zero-level to show change of trend - donwtrending now. Broken strong horizontal support at 5.63, the next strong support I could see is at 5.31, another 20cents DOWN is a strong BUY.

p/s : I cleared MAS and Hai-O today to get ready for Supermax. Might even clear my small amount of Gamuda tmr to get ready ... shoot at 5.30!! Dare to be contrarian?

3. Hartalega : At 7.96.RSI 44.4

4. Kossan : At 3.68. RSI 36.4

5. Latexx : At 3.42. RSI 37.2

6. Adventa : At 2.68. RSI 24.1

7. Rubberex : At 0.98. RSI 36.2

TEH

Could Wall Street be about to crash again?

Source : WSJ

Here are 10 reasons to watch out.

1. The market is already expensive. Stocks are about 20 times cyclically-adjusted earnings, according to data compiled by Yale University economics professor Robert Shiller. That's well above average, which, historically, has been about 16. This ratio has been a powerful predictor of long-term returns. Valuation is by far the most important issue for investors. If you're getting paid well to take risks, they may make sense. But what if you're not?

2. The Fed is getting nervous. This week it warned that the economy had weakened, and it unveiled its latest weapon in the war against deflation: using the proceeds from the sale of mortgages to buy Treasury bonds. That should drive down long-term interest rates. Great news for mortgage borrowers. But hardly something one wants to hear when the Dow Jones Industrial Average is already north of 10000.

3. Too many people are too bullish. Active money managers are expecting the market to go higher, according to the latest survey by the National Association of Active Investment Managers. So are financial advisers, reports the weekly survey by Investors Intelligence. And that's reason to be cautious. The time to buy is when everyone else is gloomy. The reverse may also be true.

4. Deflation is already here. Consumer prices have fallen for three months in a row. And, most ominously, it's affecting wages too. The Bureau of Labor Statistics reports that, last quarter, workers earned 0.7% less in real terms per hour than they did a year ago. No wonder the Fed is worried. In deflation, wages, company revenues, and the value of your home and your investments may shrink in dollar terms. But your debts stay the same size. That makes deflation a vicious trap, especially if people owe way too much money.

5. People still owe way too much money. Households, corporations, states, local governments and, of course, Uncle Sam. It's the debt, stupid. According to the Federal Reserve, total U.S. debt—even excluding the financial sector—is basically twice what it was 10 years ago: $35 trillion compared to $18 trillion. Households have barely made a dent in their debt burden; it's fallen a mere 3% from last year's all-time peak, leaving it twice the level of a decade ago.

6. The jobs picture is much worse than they're telling you. Forget the "official" unemployment rate of 9.5%. Alternative measures? Try this: Just 61% of the adult population, age 20 or over, has any kind of job right now. That's the lowest since the early 1980s—when many women stayed at home through choice, driving the numbers down. Among men today, it's 66.9%. Back in the '50s, incidentally, that figure was around 85%, though allowances should be made for the higher number of elderly people alive today. And many of those still working right now can only find part-time work, so just 59% of men age 20 or over currently have a full-time job. This is bullish?

7. Housing remains a disaster. Foreclosures rose again last month. Banks took over another 93,000 homes in July, says foreclosure specialist RealtyTrac. That's a rise of 9% from June and just shy of May's record. We're heading for 1 million foreclosures this year, RealtyTrac says. And naturally the ripple effects hurt all those homeowners not in foreclosure, by driving down prices. See deflation (No. 4) above.

8. Labor Day is approaching. Ouch. It always seems to be in September-October when the wheels come off Wall Street. Think 2008. Think 1987. Think 1929. Statistically, there actually is a "September effect." The market, on average, has done worse in that month than any other. No one really knows why. Some have even blamed the psychological effect of shortening days. But it becomes self-reinforcing: People fear it, so they sell.

9. We're looking at gridlock in Washington. Election season has already begun. And the Democrats are expected to lose seats in both houses in November. (Betting at InTrade, a bookmaker in Dublin, Ireland, gives the GOP a 62% chance of taking control of the House.) As our political dialogue seems to have collapsed beyond all possible hope of repair, let's not hope for any "bipartisan" agreements on anything of substance. Do you think this is a good thing? As Davis Rosenberg at investment firm Gluskin Sheff pointed out this week, gridlock is only a good thing for investors "when nothing needs fixing." Today, he notes, we need strong leadership. Not gonna happen.

10. All sorts of other indicators are flashing amber. The Institute for Supply Management's manufacturing index, while still positive, weakened again in July. So did ISM's new-orders indicator. The trade deficit has widened, and second-quarter GDP growth was much lower than first thought. ECRI's Weekly Leading Index has been flashing warning lights for weeks (though the most recent signals have looked somewhat better). Europe's industrial production in June turned out considerably worse than expected. Even China's steamroller economy is slowing down. Tech bellwether Cisco Systems has signaled caution ahead. Individually, each of these might mean little. Collectively, they make me wonder. In this environment, I might be happy to buy shares if they were cheap. But not so much if they're expensive. See No. 1 above.

Write to Brett Arends at brett.arends@wsj.com

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