Saturday, June 5, 2010
Sunday, May 30, 2010
My costly misses in 2010 and a summary of my performances in first half 2010
I am far from achieving my targets set in 2010, and here' s why:
1. The purchase of Swiber just before the correction in Jan was most untimely. It tied up my funds and cost me. I was eyeing Noble and a few blue chips at that point.
Estimated costs: Noble $2,000 - $1,000 = $1,000
2. The sale of SATS was very untimely as it was done immediately after the Feb correction.
Estimated costs if I have waited 1 more month: $2,000 - $400 = $1,600
3. UOB trade was closed out too early:
Estimated costs: $1,800 - $200 = $1,600
The lack of nerves failed me. My trading was affected because subconsciously, I was expecting the market rally to end soon. But still, as a trader, I think it is very important for me to stick to the current trend until it reverses.
Personally, I feel the first half of the year could be the "last leg" of the stock rally that began in March last year. This was exhibited by the fact that stock price have only gone on to make marginal highs after the Feb correction. In fact, many stocks did not even break their Jan highs. This is only normal, especially after most stocks have climbed 100% since last year. I did not make much from this last stage of the stock rally. But, I am not complaining. I have to be content with what the market gives me. I am hoping that a new bear market in the second half will give me a fresh start.
A summary of my performances in 2010:
Total Trading Cumulative Profit/ Loss in 2010
Bal b/d +378
May -1,244 (-344 from forex and -900 from SembMar)
Bal c/d -866
Big mistake: Follow other people's advice on longing SembMar and Eur/Usd). This costs me $1,000. Lesson: Never again read other people's blogs. Always do my own analysis
Long-term Positions (closed)
Citigroup +10.5%
Gold +4%
SATS +4.4%
Swiber +4%
Gold was closed because I want to pare my position in it and Citigroup was closed because it triggered my definite sell point. Good thing now, is that I have more funds for long positions later.
Long-term Positions (open)
Gold +8%
Cumulative Long-term Positions 2010
+6.2%
1. The purchase of Swiber just before the correction in Jan was most untimely. It tied up my funds and cost me. I was eyeing Noble and a few blue chips at that point.
Estimated costs: Noble $2,000 - $1,000 = $1,000
2. The sale of SATS was very untimely as it was done immediately after the Feb correction.
Estimated costs if I have waited 1 more month: $2,000 - $400 = $1,600
3. UOB trade was closed out too early:
Estimated costs: $1,800 - $200 = $1,600
The lack of nerves failed me. My trading was affected because subconsciously, I was expecting the market rally to end soon. But still, as a trader, I think it is very important for me to stick to the current trend until it reverses.
Personally, I feel the first half of the year could be the "last leg" of the stock rally that began in March last year. This was exhibited by the fact that stock price have only gone on to make marginal highs after the Feb correction. In fact, many stocks did not even break their Jan highs. This is only normal, especially after most stocks have climbed 100% since last year. I did not make much from this last stage of the stock rally. But, I am not complaining. I have to be content with what the market gives me. I am hoping that a new bear market in the second half will give me a fresh start.
A summary of my performances in 2010:
Total Trading Cumulative Profit/ Loss in 2010
Bal b/d +378
May -1,244 (-344 from forex and -900 from SembMar)
Bal c/d -866
Big mistake: Follow other people's advice on longing SembMar and Eur/Usd). This costs me $1,000. Lesson: Never again read other people's blogs. Always do my own analysis
Long-term Positions (closed)
Citigroup +10.5%
Gold +4%
SATS +4.4%
Swiber +4%
Gold was closed because I want to pare my position in it and Citigroup was closed because it triggered my definite sell point. Good thing now, is that I have more funds for long positions later.
Long-term Positions (open)
Gold +8%
Cumulative Long-term Positions 2010
+6.2%
Saturday, May 29, 2010
Will stock markets fall further? My fear is yes.
Faber now thinks the stocks are oversold in the near term on extreme negative sentiment towards the euro and North Korea, but there’s strong support around 1,045/1,050.
From a seasonal perspective, a summer rally in June/July could be expected, with a lot of resistance around 1,200/1,220, followed by a downturn and bottoming out in October/November. By then, another round of stimulus could come in and prop up equities as a stronger U.S. dollar and bond market would give the Fed ammunition to ease the monetary policy.
(Note: In a separate interview with Tom Keene on the same day, Faber says S&P could fall another 15%.)
The situation now:
On major indices (Dow, S&P, Hang Seng, STI):
On monthly chart: Bearish engulfing, stochastic falling from overbought zone. This signals long-term bearishness ahead. The last time the STI made such a pattern in Nov 2007, it took 1.5 years, in Mar 2009 before bottoming. This suggests that instead of looking at longs, it is now time to look at shorting the market.
On weekly chart: Hammers are forming, with reversals of stockastics but still falling RSI. This could indicate in the short term, the stock market may or may not reverse.
On daily chart: Dow Jones just made a bullish engulfing, coupled with recovery from oversold RSI and stochastics, signalling short-term upside.
Therefore, the trends of the markets can be summarised as such:
Long-term: Down
Medium-term: Uncertain
Short-term: Up
Therefore, Faber could be right in predicting a stock rally into June/ July (even though this is World Cup year, and many people are expecting trading to be quiet). Nonetheless, I will not be putting too much capital into long positions. However, 2 stocks in the local market stand out as still being on an uptrend (prices remaining above 200-day MA): SembMar and NOL.
Compared to SembMar, NOL looked just a tad more attractive as it just exhibited bullish engulfing, and crossing up from oversold stochastics. SembMar looks "overbought" at its current price.
My Trading plan:
Buy when market opens on 31/5
SL: 1.75 (correction low)
TP1: 2.00
TP2: 2.20
After this rebound, it will be time to prepare my ammunition for shorting the market.
From a seasonal perspective, a summer rally in June/July could be expected, with a lot of resistance around 1,200/1,220, followed by a downturn and bottoming out in October/November. By then, another round of stimulus could come in and prop up equities as a stronger U.S. dollar and bond market would give the Fed ammunition to ease the monetary policy.
(Note: In a separate interview with Tom Keene on the same day, Faber says S&P could fall another 15%.)
The situation now:
On major indices (Dow, S&P, Hang Seng, STI):
On monthly chart: Bearish engulfing, stochastic falling from overbought zone. This signals long-term bearishness ahead. The last time the STI made such a pattern in Nov 2007, it took 1.5 years, in Mar 2009 before bottoming. This suggests that instead of looking at longs, it is now time to look at shorting the market.
On weekly chart: Hammers are forming, with reversals of stockastics but still falling RSI. This could indicate in the short term, the stock market may or may not reverse.
On daily chart: Dow Jones just made a bullish engulfing, coupled with recovery from oversold RSI and stochastics, signalling short-term upside.
Therefore, the trends of the markets can be summarised as such:
Long-term: Down
Medium-term: Uncertain
Short-term: Up
Therefore, Faber could be right in predicting a stock rally into June/ July (even though this is World Cup year, and many people are expecting trading to be quiet). Nonetheless, I will not be putting too much capital into long positions. However, 2 stocks in the local market stand out as still being on an uptrend (prices remaining above 200-day MA): SembMar and NOL.
Compared to SembMar, NOL looked just a tad more attractive as it just exhibited bullish engulfing, and crossing up from oversold stochastics. SembMar looks "overbought" at its current price.
My Trading plan:
Buy when market opens on 31/5
SL: 1.75 (correction low)
TP1: 2.00
TP2: 2.20
After this rebound, it will be time to prepare my ammunition for shorting the market.
Wednesday, May 12, 2010
Reflections on SembMar trade
It seems likely that I have made a premature exit from SembMar. Should I reenter?
I can only if I am :
Convinced that the market will run further. However, I am having a lot of doubts that the market can rise much further.
But would I then not miss out on profits? I think sometimes in the stock market, we have to learn to not be greedy and chase after every opportunity. Yes, allow some of these opportunities to pass through our fingers, and conserve our resources for the next round.
But since the price is still hovering around where I last left, there is a chance to get back into the action. But I need a stop at the entry price. Actually quite risk free, since I have already booked some profit. Hopefully, tomorrow when market opens, it does not gap up, so that I will have a chance to get back into the action. Let's see how.
I can only if I am :
Convinced that the market will run further. However, I am having a lot of doubts that the market can rise much further.
But would I then not miss out on profits? I think sometimes in the stock market, we have to learn to not be greedy and chase after every opportunity. Yes, allow some of these opportunities to pass through our fingers, and conserve our resources for the next round.
But since the price is still hovering around where I last left, there is a chance to get back into the action. But I need a stop at the entry price. Actually quite risk free, since I have already booked some profit. Hopefully, tomorrow when market opens, it does not gap up, so that I will have a chance to get back into the action. Let's see how.
Tuesday, May 11, 2010
I'm out of SembMarine
I have exited SembMar for a small gain of +600. Market has started turning down again, and I am expecting the downtrend to resume from hereon. Better save the bullets for the real opportunity later.
Monday, May 10, 2010
The trend is down, but I am long on the market
I am long on SembMar since last Friday at a price of 4.08. I did not short because I was expecting a rebound (it happened today) as the market has been extremely oversold. The candles on SembMar also showed signs of reversal, with 2 inverted hammers, confirmed with a long white candle on Friday. The price was also rebounding nicely from the 61.8% level drawn from 9th Feb to 27th Apr. RSI and stochastics are also crossing upwards. BTW, SembMar is a stock still on the uptrend (unlike many others on SGX).
The bounce was augmented by news over the weekend that Europe has specially tailored a rescue package for Greece.
However, I am not expecting this countertrend rally to last very long. Therefore, after this rebound, I will be looking to short the markets.
The bounce was augmented by news over the weekend that Europe has specially tailored a rescue package for Greece.
However, I am not expecting this countertrend rally to last very long. Therefore, after this rebound, I will be looking to short the markets.
Tuesday, May 4, 2010
Bearish phase of market could have started
A bearish phase of the current rally have started. A check on thecharts have shown that many stocks have failed to break their January highs or broke marginally. They have since quietly but surely slid down.
Of these, some stocks have become more sick than others. Notably the property stocks exposed to China. Stocks that have broken below their 200-day MA include:
1. Capitaland
2. Ezra*
3. Ezion
4. Olam*
5. Sino-Ocean
6. Straits Asia
7. Wheelock*
8. Pan Hong
9. Yanlord
10. Hang Seng Index*
*represents excellent shorting opportunity, as they just broke down from 200-day MA.
My favourite to short is Wheelock. Excellent shorting candidate as it is exposed to property sector, it just broke down 200-day MA, and its failing to clear the 50% retracement from June 2007 high to October 2008 low (which now serves as resistance). It is also flashing parabolic sell signals.
Currently, it is sitting on 1.85 support (50-week MA). There is another support at 1.81 (recent low). Will wait for these 2 supports to break before taking action.
Of these, some stocks have become more sick than others. Notably the property stocks exposed to China. Stocks that have broken below their 200-day MA include:
1. Capitaland
2. Ezra*
3. Ezion
4. Olam*
5. Sino-Ocean
6. Straits Asia
7. Wheelock*
8. Pan Hong
9. Yanlord
10. Hang Seng Index*
*represents excellent shorting opportunity, as they just broke down from 200-day MA.
My favourite to short is Wheelock. Excellent shorting candidate as it is exposed to property sector, it just broke down 200-day MA, and its failing to clear the 50% retracement from June 2007 high to October 2008 low (which now serves as resistance). It is also flashing parabolic sell signals.
Currently, it is sitting on 1.85 support (50-week MA). There is another support at 1.81 (recent low). Will wait for these 2 supports to break before taking action.
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