Market emotion as it move.

I found a very interesting picture that really describe the investor emotions at every stages of the market.

When the market tank all the way to 2009 Mar, alot of people are in disbelief that the market would go up. They are afraid. So most of retail investor do not participate in the market.

When the market went up, hope set in. The investor have hope. However majority of the people would still not participate.

The market went up higher, They are optimistic. Retail investor start to come in. As the market goes higher, more and more have belief.

This belief would bring more and more investor where they will feel the thrill. And finally euphoria.

I love this stage as lots of people would buy at high price and wish to sell at higher price. This is euphoria. This automatically bring up the market for trader like me.

Then the mkt drop, investor are anxious and wish that the market would go higher. They also belief that is a long up run and a drop is normal.

Further drop will let them lose hope of the market. Which cause them to be denial.

Then fear set in. They are afraid that their investment would not promise any return.

Soon, Panic. There will be panic selling. They do not wish to hold anymore and seeing the big drop, they are panic and start to sell with anger that this investment is not for them. They will blame everyone in the world, except themselves.

Then capitulation set in, this is when investor give up on the market. They will sell at any given market price.

The cycle goes on.

Uncertain market

Hey folk

I am in UK for holiday and haven update my blog for sometime.

The USD is still the mover or shaker for the US indices. Whenever the USD went up, the mkt goes down and vice versa.

I have been on the side line for awhile. The market is really uncertain. However, my take for S&P 500 is still unchange. It is still going up. I have been stop out for a number of trades previously and i have reckon that the market is in a serious uncertain manner.

US indices have stay on the support of a trendline back from Mar 2009 very well.

STI are on the side ways consolidating.

My take is Wait for opportunities. Let the market come to you, be patience and do not jump into the market.

Mkt update

Hey folk

Looking at the chart, we are having a technical downward move.

Look at 2009,2010 May to Jul period, you will see that it is a downward move before a uptrend for most indices.

One very interesting thing to note, the USD index

and the Euro index

You see a head and shoulder forming in Euro, which mean there may be more downside.

For USD, there may be a up move in future. There are forming higher low.

These is inline with what i said on many posting before, the market is going back to normal. USD up, stock market up. This is the desire condition for a real growing economy.

Right now we are having a transition, and transition is never smooth sailing.

Property prices

Hey folk

I am not a Property guy. But property are related to economy and there are a few stocks that are closely related to.

Let me start by saying in the recent General Election, so many people are asking the govt to do something about the housing market. Too high in price, take life time to pay. Now the URA have increase the supply by quite abit. With increase in supply, price will be lower.

However, external situation, ( too bad we live in a country call Singapore that depend alot on external factors, maybe if we manage to find oil in pulau tekong then we are better off) do not look rosy. As in foreigner wish to buy and flip or rent out the property, but cooling measure comes in, so the demand would drop.

Next, interest rate would never never stay so low forever, when things pick up, interest rate increase, this discourage people to borrow, people whom have borrow may have problem paying which may cause default and if too many people default then another subprime will come. But we wont be in that condition i strongly assume.

So to me property prices are going to come down. this may lead to property share being slow moving.

Video interview with Jim Roger

http://www.marketwatch.com/video/asset/rogers-only-a-crisis-can-fix-us-debt-problem-2011-06-08/7B14FAAB-F745-4ECA-ADB4-F8D5BD0A2C96?link=mw_home_kiosk#!7B14FAAB-F745-4ECA-ADB4-F8D5BD0A2C96

Who are usually the market big boys

Hey folk

Who are the market big boys?
Lets get the insider out, as in the company share buyback, the director or the CEO themselves.
The big boys are usually financial institutions. Which mean to say Banks, insurance company. Of course not forgetting some brokerage firm and prop trading firm. But the major ones are the Banks, insurance company.

Because of their size, they are like a big ship. Wherever they go, they leave a trace. It is hard for a big ship to make a turn which mean to say, when they start buying they cant do it at one go, when they sell they cant do it at one shot too. For small trader like us, we can maneuver, but we are at the mercy of these big players.

For futures trading, there is the commercial, people that use the good to make money. They are the biggest player in the market. And they usually know what is happening all the time.

UP

Hey folk

here you go...my calling for the up move is coming.is rather confirm in the US. Like i say before, no down where is the up. And if people are selling who are buying.

Also there are many things you can infer from the economic news.
From the posting http://amatuertrade.blogspot.com/2011/06/news.html

You see many fantastic things happening. Of course my trade is base on technical analysis. The news is just the sentimental. From that posting, you see the people in FED saying expect unexpected robust growth in 2nd half of the year. You see China slowing their money policy. You see QE2 is on schedule. Many many others things. If you look at Las vegas which is an indicator of US economy, it is crowded, fill with lots and lots of people. Not foreigner but local. These are tell sign that the economy is on track.

You cant expect a recovery to go straight up. There will always be slow down and then growth and then slow down and then growth again and again. The next thing I am looking for is the interest rate hike.That would be another major event.

That is also why the prediction i made for most market around the world is still the same. S&P500 to be about 1630s - 40s, STI to be about 3700s to even 3800s.People whom invested in Unit trust or some call mutual funds will ride the trend too.

News

Hey folk

lets check out on some news

Here are some of the links that the FED said:
http://blogs.wsj.com/economics/2011/06/07/feds-fisher-qe2-bond-buying-ends-in-june-as-planned/ - End of QE2
http://news.yahoo.com/s/nm/20110607/bs_nm/us_usa_fed_fisher - expect unexpectedly robust growth in 2nd half of the yr.

http://www.marketwatch.com/story/us-stocks-rebound-as-mergers-sweeten-sentiment-2011-06-07 - U.S. stocks pushed off perch by Bernanke
http://www.marketwatch.com/story/china-stocks-set-to-rise-as-tightening-ends-hsbc-2011-06-07?link=MW_latest_news - China stocks set to rise as tightening ends: HSBC

You can see the economic recovery is never a straight line. You can see things are slowing down but expect better progress in H2. You can see China policy tightening ends, which would take a few months to take effect.

However the news can speak, from technical analysis i believe that we do not fall in love with the downside. Fundamental always appear on the chart first. The drop now may mean bad news, but it also mean good bargain.

Heading up??

Hey folk

I think we are heading up

Economic recovery dont just go in a straight line up.

hi folk

Almost nothing in the world goes in a straight line. Economy recovery do not move in a straight line too. It is bound to be bumpy. That why you see the market behaving in this manner now.

My take is do not fall in love with the downside for now.

Another down day for today

Hey folk

We will see another down day for today. To me that is opportunity.

Do not fall in love with the downside

Stop out and mkt update

Hey folk

I am stop out for a few positions. Nevermind this is trading, and you have to play with the rule and never be emotion about it. You won't be 100% right all the time, always keep your lost small and let the winner run. That is when you can have big profit.

Overall, the uptrend is still intact.Look at the weekly and monthly chart and you will see that it is still a uptrend. The drop on Wednesday simple do not have any reasons for that. Remember one buy = one sell, so if there are so much selling who is buying?

For those who have trading platform that can assesses to insider trade, you will notice some very interesting fact, the insider always buy at times when the public do not buy and they sell when the public are buying. Having said that, those who do not know how to read this data please do not try to buy when nobody is buying because it may mean the drop is not the end. So make sure you understand them before applying them.

Like i say before, trading is more about you understanding the game than the money. If you focus too much on the money, then your money will be channel to people that know how to play the game. IF you dont like the game, then invest in other things, like endowment plan, unit trust etc.

Genting to me is still a promising stock. strong support at 1.98, next level at 1.92 then 1.88.