Wednesday, September 12, 2012

Technical rebound expected

KLCI : Formed a nice hammer and with DOW closed higher, we expect a rebound today!! Do we buy yesterday when we saw a hammer forming or do we buy today, waiting for confirmation? As it is below 20MA, obviuosly, do we wait for it to be above 20MA?

I bought yesterday ... I was greedy when I saw hammers formed. So, I bought DRBHicom and AirAsia(oversold). I was also queueing for CIMB but it is not done. So, I will re-look at CIMB later.

AirAsia : This is a knife, and it is risky if one do not know how to cut-loss if it dived further. I told my e-tratles on Monday that I will queue at RM3.15 and yes, I was lucky(or unlucky if it dived lower) as it was done. There are a few 'daredevils' followed my buying and many bought below RM3.20. I jumped, they jumped ... haha. We shall see later if the selling is over.

DRBHicom : As RM2.30 is a support, I grabbed at 2.32-2.33 levels when it rebounded from the low of RM2.29. I told my whole group about it, posted in my stock watch too but I do not know how many followed to buy. The risk is there but we certainly could see the hammer formed and expect a rebound.

Last night I have an urgent e-meeting with my tratles group to analyse some charts. Most of them knew that I bought AirAsia and DRB as they were with me(in chatbox). Now, I need to point out that it is risky to buy a strong down-trending stock. If the technical rebound fails, one needs to sell at cost or even at small losses. In trading, we talk about PROBABILITIES. We should be thinking in such manner ... or else, we are illogical to guess. Some even guess how high it could go ... with certain target prices!! I don't believe in crystal balls concept in predicting. I do use a lot of COMMON SENSE and LOGIC. Coupled with experiences and sharings by my whole group, it gives me confidence to take certain riskier trades.

Yes, I do like waterfalls ... the current dive is not strong enough. I do hope we could see a few more black candlesticks ... long ones. ouch.

Learning to trade well will take quite some time. But, it is worth it. At least we need to learn to protect ourselves from losing too much of money. Losing is a part-n-parcel and protecting our gains are as important too.

Happy Trading.


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