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Saturday, November 13, 2010

With DOW down by another 90 points, it broken the 11,200 critical level. Last weekend they are BULLISH. This weekend they are BEARISH. These volatilities are un-neccesary is we know what we are buying are GOOD stocks and with more upside seen.

At the moment, nothing much is cheap. To find a good stock with low P/E could be a challenge as market continues to be bullish for months ... until yesterday?

I have NOT seen KLCI dives 25 points in an intraday low for very looooooong time now. Yes, I have a very short 3 years time span in KLSE only, so I could not say about those days when market crashes etc etc. I m LACK of experience when it comes to trading markets. Give me another 5 years or so, knowing that I m a very hard-working learner, I could only improve.

GLD down 3% and SLV down almost 6% last night. Crude oil price down to USD84 now, from USD88. Interesting volatility.

Today I will want to share a little about what a person needs, basically, to trade markets. This is merely my views.

KNOWLEDGE :

TOOLS :

ATTITUDES :

EXPERIENCES :


Whatever shared here are just what a novice trader like me going through the thick-n-thin of markets. Yes, for those 'old-timers', they could see that I have been testing a lot of trading methods and buying a lot of different stocks in different sectors and also even different financial instruments(like warrants and call-warrants).

I am really a RA = Rojak Analysis. I started with reading brokers' reports in daily basis. Then, I learnt to read annual reports to understand businesses. I read investment books and still like many of them. I read some economic books to learn about trades and terms they used. That was in my first year in KLSE ... 2008 where market shown NO mercy to a novice like me. Yes, I m not embarassed to say that I do lose many of my trades. Today, I m using more TA in my buying/selling, TESTING out some of the strategies mentioned.

I do not concentrate on winning or losing, actually. To me ... it is journey. It is an ADVENTURE. So, some people may see me as 'stupid' to lose money. Now, I need to point out that when we go into markets, we do not plan to lose money! I m no exception. I m just testing out many many of the strategies I read and tyring to learn to APPLY.

Yes, APPLY our knowledge, no matter how 'shallow' or some with strong knowledge, but without apply what we know, we actually might as well say we dont know!! I am THAT practical. You may want to tell me you know these or that, but if you do not APPLY it and/or dont know when to apply what, to me ... you dont know. That is knowledge un-applied. Haha.

You may be an economic lecturer or finance executives in banks, that doesnt mean you could apply your knowledge in stock-markets. You may tell me that you are in 5-10-20 years in stock market(comparing me, less than 3 years!), that wont shown to me that you apply your knowledge in good practice if you are still losing money!! Sorry, I m a practical person.

So, when I go to CNX's meeting ... I will see many uncles/aunties TRYING to learn technical analysis, I know majority of them have LOST money in stock-markets. No one will like to confess such 'embarassing' thing, but I dont see it as embarassing. Afterall, stats shown that 80-90% of them are losing money in markets!!


Waterfall-catching

Example : I am applying a waterfall-catching technique which I have been observed for 2 years now! It wont be easy to catch a 'bottom' and seeing that stock rebounding 10-20% in a week or sometimes in days.

The recent successful ones were JCY, Supermax and latest Evergreen(still open).

When JCY trading below RM1 previously, I started to stalk her. When it went down to 90cents in a VERY fast pace, RSI went below 20 and a simple no-brainer(but with guts?), I started to queue lower and lower. That is how I caught her at 88 cents. It shot up to above RM1 in few days time!!

When Supermax trading below RM4 recently, I was excited, seeing such a huge selling pressure. Then, the day when it went below 3.80, I started to queue as RSI on THE DAY(market still opens) will be below 20. To me, that is technically ridiculous for Supermax. Psychologically, many panic-selling seen ... and time to collect. Nervous but applying my knowledge, using the right tools for my waterfall-catching ... with the right attitudes towards my trade, it is a BUY at 3.75, 3.70 and 3.65. Guess what, I was only lucky to grab at 3.75(1k units). If it dived to 3.70(1.5k units) and 3.65(2k units) ... I will be using up all my capitals then. I was nervous but experiences come in handy in such a ride! I could be wrong and becoming a loooong term investor in Supermax.

So, when Evergreen moved below Rm1.40 recently, I started to move in ... only 1.38-1.39 levels done. If it dives all the way to 1.35, I will be holding more of it now. After it rebounds the next day, I grabbed more at 1.43-1.45. It shot up to 1.55 yesterday before retracing to 1.45. It is still open ... I traded LIVE with my 2 clients(one bought at 1.38, another late comer at 1.45) buying into it. Of coz, some will say ... it is a back-hand call. It doesnt matter how u see it, more importantly .. we share it here, look and learn, ok? You need the RIGHT attitudes in investing or trading. That I could not change you.

9.30 pm : I went to KLCC for the market-talk ... yes, I m VERY glad to meet Marc Faber in person and he is VERY knowledgable. He is my 'sifu'. I took a pix of him. Shake-hand and greet him. It is an honour!!

I will post his pix here tmr or next week when I m free. I m tired now ... need to sleep early for tmr's morning bowling competition!!

I will like to write about the talk, stock-picks and my opinions on some of it. To me, if on Monday my holdings like WCT, BStead, Sunway, Alam, Kencana, Bursa, EAH(bought back on Friday at 0.58), LionInd, Evergreen, AnnJoo drop again, I will queue 3-5% lower the closing price on Friday. I have NOT look into any of the charts to determine the entry points. Besides, I m out of bullets soon.

HuaYang, Kinstel and JCY which I bought all at RM1.00(easier to remember! Haha) are HOLD. No buying or selling.

Due to 'over-diversify', I will clear some, especially those with 'small' amount of holdings ... and to concentrate on fewer stocks.

Currently, I like Tenaga at this level. I am also eyeing BRDB.

Night.

AJ : Thanks for your re-load to my hp. Let me know when you are free, we go for a drink. On me. :)


TEH

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