Mkt update

Hey folk

We witness the upmove of the market in the US yesterday night. The indices closed at almost the day high for the transport, Industries and the S&P500.

The Emini S&P500 futures Jun 2011 contract have close at 1317, which is higher than the previous day high if 1315. If it successfully move up higher again today, then probably we are going to see the market moving higher.

Asia market have show some weakness during the last few days, but is soaring as of now. When they all break out the recent high with conviction, my guess is the market is heading the way up.

I have sold some of my position in the previous days but not all.

How do I learn all these fundamental stuff??

I got a discussion with a few colleague that ask me how i understand all these economic things eg, what is the credit crisis, what happen in 1987, how hot money affect us, why SGD is getting stronger and the other countries reduce interest rate, China is having inflation why invest in china??etc when even i am not a economic student.

Is abit hard to explain though, probably i am very interested in all these and i read up alot. As i dont really have a formal degree on these, i have to do lots of research on it. When you do research, usually you find lots of useless information. But this useless information can be link with other article and gradually form a picture and please infer more to form larger picture. I went for exchange where i took all finance modules, this is where i learn more and match all the things i learned together.

The key thing is get interested. This is how i know the fundamental on the macro side. Eg. Spore do not use interest rate to curb inflation, we use our SGD, while US, EU they use interest rate. The lower the interest rate it promote more lending and thus simulate the economy and eventually create inflation inwhich interest rate have to be raise to curb inflation and on and on. It is a cycle, like a sine wave.

If you wish to shorten the process, i recommend you read the 'Hard truth to keep Singapore going'. The interview with our MM. Awesome book. MM highlight all these in a few paragraph, he really is a database and lots of experience. He practically know everything,every details till the bit. He sum up the culture,tradition, history, economy and politic of US, EU, China, India etc. No doubt he is so much well respected around the world.

If you can, grab the book. Also please read lots of newspaper especially on the biz section. Because the real fundamental analysis is so broad, you need to know everything. I do not know lots of them, i admit i only know so little. The more you know will actually lead you to know what you dont know.Gd luck

Mkt update

Hey Folk

Right now the US mkt is still in the positive territory. The trend for upmove is intact. However not that strong.

I expect asia mkt to weaken for this few days.

But not to worry, we are not going into a great drop of a a hundreds points in STI as of the current situation.

Some people ask me how i can guess the direction of the market.... Is Technical analysis. Fundamental analysis really tell you how sound the company you are buying. Yes this is absolutely important. But it cant tell you the current direction or even the precision of the price. It can only say, it good and it going up in the future.

Technical analysis tell trend and can pin point the exact buying price and exit price. Both analysis are real important and useful if you know how to use them well.

I am a pure Technical analysis trader and i do use fundamental as a reinforce on my technical analysis. Is good to know both analysis, but is hard to master both at the same time.

Mkt update

Hey folk

The US market close higher yesterday. But you are seeing some smaller rate of change. The Dow Jones Ind hav also rest on to a resistance point. Dow Jones Transport too, have hit a resistance level.

Either the market is going to fire all the way up or we are entering into a dips (which will eventually formed the inverse head and shoulder that will allow the market move higher).

We are some how similar to what happen in the 2003 period. If the govt around the world can control the inflation well, Europe region pass the stress test, US growing, then we are back on track for rally.

Nth is 100%

Mkt update

Hey folk

We see a week of upmove this week in all major indices.

From the chart, i dont see any sign of a pull back yet. But if you have not buy into the market, please do not buy.Stay at the side line.

How to use W%,RSI

I would like to share how to use W% and RSI in this post.

Well for me I usually use W%, I think it is really reliable. However, you sure need other indicator, chart pattern and price action to justify the movement.

W%

It is created by Larry William, one of a great trader that i know. Williams' %R is an effective momentum indicator that measures overbought/oversold levels.
It ranges between 0% and 100% .
The 0% indicating overbought and
100% - the oversold stocks.
W%R measures the closing price in relation to the recent low/high range.
I usually use the upper limit and lower limit at -25% and -75% respectively. When the signal head above -75%, it mean a buy signal, while if the signal head below -75% is mean a sell signal.

RSI is almost the same as the W%, but the 0% indicate oversold and the 100% indicate overbought.

Mkt update

Hey folk

Leader of all US indices Dow Jones Transport:



See the explanation in the picture. Also there may be a inverse head and shoulder in the making. Which call for upward movement.

If you look at all the other indices Dow Jones Ind, S&P500, the Emini S&P500 (futures), the STI, all of them may have a inverse head and shoulder in the making.So when it is form, more upside would be coming.