All in a day's work

Still learning on TA as an indicator of market movement. However, spotted something interesting in e chart of STI.

1. Resistance turned support line since 2005 has yet been breached.

2. However, @ 50% retracement, is a good support line, only broken during the Aug period reaching 61.8% retracement. Another point to note here is that this line has been rebounded off 5 times. Technical Reobund perhaps ?

3. Despite this sign of rebound, it is not confirmed that the worse is over. We need more confirmation. ie: The hige volume as on Aug and some definite signs from Uncle DJ.

Dun be lured by such temporary rally. Be careful.

From Wikipedia: "Technical analysis is the study of market action, primarily through the use of charts, for the purpose of forecasting future price trends.".In its purest form, technical analysis considers only the actual price behavior of the market or instrument, based on the premise that price reflects all relevant factors before an investor becomes aware of them through other channels."

I was talking to a friend recently who told me that candlesticks do not work. Reason being he ignored the financial and fundamental issues but depends wholly and only on TA, just the fat, short, black and white sticks with tails @ the top and end.

. To state my point, TA is but an indicator or a tool for analysis on counters. We must nore forget that markets are all INTER-DEPENDENT.

eg: DJ drop, SG may drop as we "look" up to them. HSI rebound heavily, STI may not rebound as much. It's all dependant on how much we "look" up to the investors in the bigger market. How can an island of about 4-5m population stand against the WALL Street or HSI, not forgetting China. We are just small frys in a way so.... do be careful when you trade. Look around. Don't get your funds locked down.

TA is afterall but one of the tool for analysis.

This correction is really long, in fact I think it's much longer than what a lot of people expected.

Sadly CES did not manage to sustain it's 200MA and went below it. Wasted. But what to do what the market sentiments is now so...... choppy, One day up One day down.

Well, I've read articles and comments that Fundamentally CES is good. Not that fundamentals are not important but in a time like this, it's the market sentiments that actually moves the stock. Who really bothers about TP in a bear market. The main concern is that the TP don't drop. Take counters like YZJ, TP of like what... $3+ in 12 months? It's dropping like bombshells @ e moment, but of course, for very long term investors they can still buy but 'm sure having a little more patient wun hurt!

Why throw $ into something that's falling? Averaging the cost of purchase! If you think it through, if it goes even furthur down, you're actually throwing $, and further losing more! And when the price drops to like $1.86, buy more? So saying you bought 3 times 5 lots each @ $2.09, $1.95, $1.86 having the mentality of averaging down, Let see... basic Maths

($2.09-$1.86)*5 = $1,150 -- Lost if held on since $2.09
($2.09-$1.86)*5 + (1.95-$1.86)*5 = $1,600 -- Lost if Averging is done.

True, if it goes up you earn! But is the risk worth taking? Simply put, profits come in when price rebound. Let's say again, it rebound upwards to $1.96 from $1.86, doesn't this offsets the loss of the 2nd buy? Did you @ e end of the day then, profit?

Ladies and Gentlemen!

I think I might have found a gem for long. Introducing ChipEngSeng!!

Was "taught" how to derive 200EMA and decided to take a look at some counters!

1. Note the 4 Red down arrows.

All these days tested this line of resistance, dated back Nov 06, that's a good 1 YEAR AGO! Alright... It broke but then now it's testing it again.

Will it like before break this resistance and rise another $0.50? That's 10% in a month. I'm taking a rough estimate.

2. Let's welcome 200EMA!

Note the green line. It broke this 200EMA a few days back but now it is resting on it ago and based on historical records till date, it has only broken this trendline twice, considering the last broke a few days back.

3. Note the 2 Green Up arrows

Granted it broke the 200EMA, however it also tested the price of .575 the "mini" gap-up price set on 21st May. Good news is, it did not close below it.

Well, could Friday's closing on DJ and STI be a sign of reversal?

Tested around 3400 on Friday but closing on resistance of the Aug period @ 3438, almost a doji. If I'm not wrong there is a name for this kinda formation, a hammer, albeit the long tail at top, right wrong??

But well... it's only possible but as usual, dun dive into the market observe it!!

Was pointed to the fact that it rebounded off it's 200MA but then again, DJ's closing was strong from 4pm to 5pm. BB buying up, so that Monday might look better ?? It's hard to tell depends on Monday.

No rush, the market will last longer than you! -- Prof Guang!

Ohhhhh Mannnnnnn

Nice time for a good correction/recession huh! Exam period..

Seriously, looking at this chart of STI, things are not looking rosy.. at least for tomorrow.

Notice:

1. Gap downs on 3 days

2/11/07
9/11/07
12/11/07

2. Botak Black top on 12/11/07

This definitely shows some pessimistic sentiments in the market at the moment. Not even a short tail to "try" to push the index up. Tsk tsk tsk...

3. Next price to break. 3500.

Actually the price range of 3483-3529 is a range to break. Today, as of time of post, is in this region. Let's see what happens tomorrow.

If break, woohooo, Remember the August correction? This will be much worst! Considering it dropped from a higher point compared to July's peak.

Big Money Question: Will 3400's resistance even be tested ? Let's observe!

** In the mean time, back to books! Exams are round the corner.

Hong ah Hong!!! What happened!!

Alright there were signs of a selldown.

1. Gap down.
2. Price never recovered

**Know when to exit if you're doing short term trading. Notice the signs.

HOWEVER, do note last closing, BOTAK!!!!
Once again, testing the resistance. Could be another run. Who knows!!

Ok. Cut simple story short.

I entered and exited for quick $ in fear of Uncle DJ not doing well on friday, another sea of red but well...... arghhhhhhh it closed flat. =.= If only, it'd been worse!!

Ok same this. Observe the b/os here.

1. B/O 1: Resistance since long ago.
2. B/O 2: From normal uptrend.

Gap down on 2nd day was simply ignored and it just went up to close a bit higher than prior day's high. Strong formation given a bad day.

Alright.... this counter is heavy. But I dun understand the link here. =)

Observe! This counter might be on another good run again!!!