good market? bad market?

In the midst of my revision for my exams, I will check the stock markets occasionally for updates and the latest happenings.

As US took quite a tumble these few days, take note of something, I remembered that the highest for dow was at around 14100 as I do monitor US markets at night, and look at what it is now? It is now at 13676, which signified a drop of around 500 points! A big gap down after the bull run, and oil nearly peaked a high of $90USD.

Besides dow, NASDAQ seems much stronger due to apple, high sales from the iphone release. Remember what I have mentioned, in any recession, technology counters will be the one to lead the stock market out of the recession. In any case, the market seemed to have taken a slight turn at this point, and I must emphasize on 1 point. When the market starts to turn around, it doesn't just drop 500 points within a few days and then bullrun up again. It has to go through a consolidation period to re-adjust its value and confidence level again to reach new highs.

I was talking to my broker and he mentioned to me about the CNA forums for the SGX market. It was an interesting topic as he identified some ideas from the forums itself. I always thought that the forums is just a place for people to share whatever they know, or probably induce people into buying certain stocks etc. But a forum is just a forum, how many investors are there to actually push the particular counter? He highlighted this point to me, being that I'm partially right, that it's not going to be like pushing the whole of STI, but then, it is good enough to push a particular counter to a certain price level! Imagine this, X made a post telling everyone to buy counter Y, saying that it will rise today and prepare to collect money. Probably at this point, he identified this, maybe 1 person can buy only 5 lots, but if there are 10 people who buy at 5 lots, it will be 50 lots. Ok, so how many retail investors are there browsing this forums? How many of them are knowledgable in the stock market? He pointed another thing, which is X who asked everyone to buy in, would probably have already bought in before the day itself, and when people start to buy in, the selling can be averaged out and would have been out from that counter already.

Next thing I personally noticed in the forums, is that they always say that dow should follow STI, US markets should follow the asian market etc. In my opinion, MAYBE the asian market could be the market leaders in the future, but I do not really see it as a leader within these few years. Why? First things first, STI to lead dow? I personally find that this is a joke comparing Singapore to US. Look at Singapore, our population is around 4+ million, and the amount of land we have. Now look at US, how big is the US? Also, what does the Singapore economy depend on? What are our strengths that keep us being one of the first class countries all these years? Manufacturing and export may be one of them, but our dear MM lee who does have foresight, already knew of our future growth and kept rebranding ourselves as the air-hub, education-hub, financial-hub etc. What does this mean? We are actually branding ourselves as a door for US and europe to actually tap into the asian market which is still at its growth stage. Along that, Singapore provides the human resources available to bridge the 2 parties together. That's our strength for our economy growth, and for us to replace dow? Probably that means the opposite of what I stated just now!

But in any way, asian markets depend heavily on US as exports from asia go to US and europe. If I remember correctly, almost 70% of the consumer goods in US is imported from asia. If a recession hits US, do you think they will buy anymore? When they do not buy as much as they do, do they want to import anymore? It's a chain effect, so those people in the forums who keep cursing the US stock market to crash, in my opinion are relatively ignorant of the chain effect.

STI have closed for the day, and it seems that today's closing was at -1.25%. However, from what I see, it took a drop of near of 2%. Why? This morning, I saw the market at around +0.7%, which was seemed to be recovering. As of now, it closed at -1.25% from its opening, which to me signifies a close to 2% drop! It is very interesting to see how the US market fares tonight, and I may take a position again. What am I looking at? The same few, celestial and Asia environment. The third one which I'm still considering whether it's worth to take the risk is hor kew, due to its rights at $0.02. The main share which is trading at $0.195 currently, seems relatively a high risk to enter. I will study the charts tonight after my revision and decide whether to buy the rights warrant at $0.115. Apart from that, I have read the charts for celestial, and it seems that $1.36-37 seems to be the key support level. More to come! :)

Long week

It's been some time since I posted again, a very busy week for me due to school test and work. As my exams will be drawing near, I won't be playing any counters in particular as I will be concentrating on my exams. Unless there is a super high chance that I can get in, I won't really monitor the market very heavily. Few thoughts over the week, STI is still rallying, as well with the US market. Reason why I'm not going in again is because this bullrun has been non stop for the past 2-3 weeks already, and it is still attempting to break new highs! I will post the charts on the various counters soon, but take note that, any stock that has to move up, will have to come down and touch its 20MA. If it doesn't and it keeps moving up, the fall will be hard to handle. This is to me, a rule of thumb to follow, and as well as the cut-loss rule of 10% and 5%. This is to ensure close to maximum profits, and minimum loss.

5th Oct 2007

Not a very interesting market to see today since most of the stocks are quite stagnant. As for celestial, as my model predicted, it touched and pierced its 200MA ($1.45) and closed above $1.45 yesterday, and that marks a slight moveup after that. Today's opening was as $1.51 and trading between $1.52 to $1.56. You will probably ask why I have not taken a position in celestial yet. Reason is because it is still slightly unclear of the current situation. Will it surge upwards or downwards? As of now of what I see, the market seems to be slightly confused, while STI is trading slowly upwards, penny stocks especially from china is still taking a beating down but celestial has rised about 8 cents since thursday till now. Is there any particular good news for celestial that caused this? I do not know and I can't find any news on that. Secondly, from the chart I see:

• the 20MA has crossed the 50MA,
• RSI slowly going down to 50%,
• stochastics down slowly towards 50%.
  

However, looking at the volume traded, it is dropping more and more, and with smaller volume, it is still rising! My prediction is I believe the shortists have been caught by this surpise move already and probably turning long for this counter, and in order to make big money, this stock will probably have to dip back to $1.45 to scare those investors who are in at $1.52-$1.56. My general feel is any stock that rise have to move back to touch its 20MA, but then in this case, the 20MA is way too far, this will shock alot of people. So, a very slow trend up is highly possible, but it must touch back its 20MA to be safe. This is my thought on celestial. I will need to analyse more once today's closing is done.

Next, 2 other companies that I'm doing my homework:

• Asia Env,
• Bio-treat

These 2 water companies have been on my portfolio for quite some time and I have seen the highest and lowest it went since from May till now. Their core business is mainly water treatment and some other stuffs which can be read from their prospectus, and recently Bio-treat has caught my attention by being on Business Times. It seems that there are some issues with the CEO (again or not I'm not sure because I have not read the full report) and SGX is monitoring this counter. As for Asia Env, it also went on Business Times, but getting the IFC's support of a certain amount of funds for its projects. How did I get Asia Env in my portfolio previously? While I was looking for information for Bio-Treat in May, I found out that Asia Env was the next water treatment company from china and comparing the resources of the two companies, Bio-Treat has a much stronger infrastructre and resources but at 1 point of time, Asia Env was trading at a much higher price! Cut the long story short, everyone seems to be afraid of Bio-Treat as it has alot of management problems. Let me do some homework on these 2 stocks and see which is a better and safer choice to enter.

Other information, Yen/USD: 116.46-116.49 - 0.08 which is ok for the US economy. Today is another day for the US market to release some jobs information, and they are speculating that it is good results from what I read on the forums. Lastly, I just saw the clip from Gareth (inthemoneystocks.com) and he was talking about the NASDAQ chart which had formed a double top. He was mentioning about this in particular, where investors would think that once the double top has been broken, they can go long on the NASDAQ. However, right after it broke the next day, it starts to dip back again. He was mentioning this as every investor would have anticipated the double top sign and big buyers will actually let it break the double top, giving the investors a wrong sign to enter the market!

This has led me to ponder and realised how not easy to make money from the stock market, as human psychology plays such a big factor! What has the stock market become of now as compared to its origin, where it is meant for companies to gather funds to support their projects?

After collecting my profits from celestial, it's time to take a short break first and enjoy the weekend. :)

3rd October 2007

Volatile market today. Today is the 2nd day where some of my china stocks in my watchlist have been dropping again. Cosco, YZJ and celestial. My focus is on celestial, since I was talking about it already. Today, as I predicted, it retracted all the way back to its 200MA ($1.452), and closed at $1.44 which is just below its 200MA. What's the catch here? Presuming that it would close above $1.45, I would have been quite sure of the support level. However, it has closed just below it, which gave me some thinking. Looking at the overall market movement, alot of penny stocks have taken the beating as well, while STI dropped about 2% from its high today. Looking at HSI as well, it really took a hugh drop of 900+ points! But then, it just writes off its increase on Monday.

Other things for information, USD/YEN is at 116.14-116.14 + 0.71, which resume its normal values. While I was deciding whether to go in at the price of $1.44 for celestial, my poems account can't view the live price, so probably this is god's will? :) Nevertheless, tomorrow will be a exciting day to see, and I still believe there's more upside for celestial to break out, and not just celestial, the other china stocks as well! I will need to go back tonight and take a look at the intraday and daily charts to determine the outlook.

Understanding how the market play is very important, because the big players make their money through us, the small fries. If the china stocks were to surge everyday, how can they make their money? As they always say, the rich gets richer, because they know how to manipulate their money. :) I can understand how those retail buyers feel, when they buy in at $1.55 to $1.65, and saw the surge to $1.75 and feel that this will keep on going. But the harsh reality always strikes, 2 days of non stop surging, from $1.21 to $1.75 is a difference of 54 cents! Any person who just join the market will want to jump up this train! (well, this was what I did in the past :) ) So, by thinking in this way, you will know (roughly) how to gauge the market. I always thought that if I knew this is going to happen, why do people still buy in? Reality is all about emotions. :) Don't lose your hard earn money, cos I learn through the hard way as well!

Lastly, I like what this guy said:

" I'm still amazed that even with the speed of information and technology today, human emotion still controls the markets" - Lou Cardinali

Always remember that the market is irrational. :)

Celestial

Looking at today's chart, it was such a long sell candle! Looking at this, stochastics are still pretty ok, with MACD and RSIstill at the high side. The 20MA and 50MA are going to touch soon, which I stated before, it should signal a huge breakout. Ok, now why did the heavy selldown came? As far as I can assume, china stocks have been running for a few days, and it was like telling the whole world that it is going to run up like no man's land! But that's the problem, while the big players have pushed the price to a significant high, retail investors may have the thought thinking that this is a time and chance to get in! But as I have stated in the morning, see the buying and selling volume. The selling volume has been high as compared to the small buyups! Now at this point, the small time buyers will be thinking, the stock has been plunging so much since the opening, what will be the next move of the big players? Today's closing is at $1.54, with the highest at $1.75.

My feel is that tomorrow the counter may touch its 200MA ($1.45-$1.46), and the more it drops, the more the small players will be scared! Probably these players will start to sell their holdings and this is the time where the big players come in. Absorb the stock at low prices again and push the price all high again! Next, shortists may see this as an opportunity to short but I got a feeling that big buyers will catch both these small fishes.

If the price did fall below $1.50 and really hit $1.45, I may go in long again, as I feel that this counter can still hit its high of $1.75 or higher!

2nd October 2007

What a week this is! Probably you can call this the china week! Since last week, various china stocks has been running non stop and under my radar, YZJ and celestial has been running non stop!

Especially for YZJ, it has broken its $2.26 previous high and has not stop till then! As far as from the charts, once the 61.8% fibonnaci line is breached, it will only break out from its 100% and hit the next level. For the next level, I would need to use nextview to actually see.

Today, I'm posting early because of something I see in celestial's buying and selling. True enough, 1 week ago, I recommended the buy in for this at $1.21 because of the various indicators.

Trading now at $1.63 at 10:02:12,
Highest today was at $1.75,
Opened at $1.69

Here are the trades done:

10:08:44 1.630 100,000 Sell Down
10:08:40 1.630 50,000 Sell Down
10:05:09 1.630 10,000 Sell Down
10:04:39 1.630 52,000 Buy Up
10:03:49 1.630 4,000 Sell Down
10:03:20 1.630 30,000 Sell Down
10:02:40 1.630 40,000 Buy Up
10:02:12 1.630 10,000 Buy Up
10:01:23 1.620 35,000 Buy Up
10:01:01 1.620 20,000 Buy Up
10:00:39 1.620 20,000 Buy Up
10:00:12 1.620 4,000 Sell Down
09:59:24 1.620 10,000 Sell Down
09:59:19 1.620 20,000 Sell Down
09:58:31 1.630 20,000 Buy Up
09:58:26 1.630 40,000 Buy Up
09:58:17 1.620 138,000 Sell Down
09:58:05 1.620 2,000 Sell Down
09:57:42 1.630 20,000 Buy Up
09:57:36 1.630 56,000 Sell Down
09:57:23 1.630 9,000 Buy Up
09:57:06 1.630 6,000 Buy Up
09:56:56 1.630 1,000 Buy Up
09:56:47 1.630 10,000 Buy Up
09:56:44 1.630 5,000 Buy Up
09:56:43 1.630 30,000 Buy Up
09:56:10 1.630 10,000 Buy Up
09:55:51 1.630 10,000 Buy Up
09:55:40 1.630 10,000 Buy Up
09:55:38 1.630 20,000 Buy Up
09:55:35 1.630 50,000 Buy Up
09:55:31 1.630 30,000 Buy Up
09:54:50 1.620 23,000 Sell Down
09:54:37 1.620 40,000 Sell Down
09:54:16 1.620 12,000 Buy Up
09:54:03 1.620 10,000 Buy Up
09:53:55 1.620 10,000 Buy Up
09:53:54 1.620 20,000 Buy Up
09:53:50 1.620 5,000 Buy Up
09:53:45 1.620 2,000 Buy Up
09:53:43 1.620 41,000 Sell Down
09:53:10 1.620 3,000 Buy Up
09:53:03 1.620 1,000 Sell Down
09:52:59 1.620 2,000 Sell Down
09:52:53 1.620 5,000 Sell Down
09:52:37 1.620 3,000 Buy Up
09:52:35 1.620 13,000 Buy Up
09:52:32 1.610 5,000 Sell Down
09:52:29 1.620 10,000 Buy Up
09:52:26 1.620 5,000 Buy Up
09:52:13 1.620 22,000 Sell Down
09:52:03 1.620 3,000 Buy Up
09:51:51 1.620 2,000 Buy Up
09:51:44 1.620 45,000 Sell Down
09:51:38 1.620 14,000 Buy Up
09:51:35 1.620 36,000 Sell Down
09:51:30 1.620 30,000 Sell Down
09:51:14 1.620 1,000 Buy Up
09:51:12 1.620 5,000 Buy Up
09:51:11 1.620 8,000 Buy Up
09:51:09 1.620 5,000 Buy Up
09:50:44 1.620 7,000 Buy Up
09:50:40 1.620 10,000 Buy Up
09:50:38 1.620 5,000 Buy Up
09:50:28 1.620 3,000 Buy Up
09:50:19 1.610 34,000 Buy Up
09:50:04 1.600 5,000 Sell Down
09:50:03 1.600 10,000 Sell Down
09:49:53 1.600 50,000 Sell Down
09:49:47 1.610 5,000 Buy Up
09:49:08 1.610 10,000 Buy Up
09:49:06 1.600 51,000 Sell Down
09:49:02 1.610 5,000 Buy Up
09:48:59 1.600 20,000 Sell Down
09:48:53 1.600 9,000 Buy Up
09:48:47 1.600 2,000 Sell Down
09:48:44 1.600 3,000 Sell Down
09:48:38 1.600 4,000 Sell Down
09:48:32 1.600 10,000 Sell Down
09:48:14 1.600 10,000 Sell Down
09:47:51 1.600 1,000 Buy Up
09:47:45 1.600 24,000 Sell Down
09:47:27 1.600 1,000 Buy Up
09:47:23 1.600 19,000 Sell Down
09:47:05 1.600 49,000 Sell Down
09:47:02 1.600 10,000 Sell Down
09:46:27 1.610 5,000 Buy Up
09:46:25 1.610 10,000 Buy Up
09:46:16 1.610 97,000 Sell Down
09:46:14 1.610 4,000 Sell Down
09:46:12 1.620 2,000 Buy Up
09:45:54 1.620 5,000 Buy Up
09:45:40 1.620 8,000 Buy Up
09:45:27 1.620 5,000 Buy Up
09:44:43 1.610 9,000 Sell Down
09:44:37 1.610 10,000 Sell Down
09:44:28 1.610 14,000 Sell Down
09:44:13 1.610 5,000 Sell Down
09:44:05 1.610 4,000 Sell Down
09:43:55 1.610 10,000 Sell Down
09:43:51 1.620 5,000 Buy Up
09:43:48 1.610 9,000 Sell Down
09:43:34 1.610 10,000 Sell Down
09:43:01 1.620 4,000 Sell Down
09:42:57 1.620 5,000 Sell Down
09:42:50 1.620 5,000 Buy Up
09:42:47 1.620 1,000 Buy Up
09:42:41 1.620 14,000 Sell Down
09:42:23 1.630 3,000 Sell Down
09:42:15 1.630 10,000 Sell Down
09:42:09 1.630 1,000 Buy Up
09:41:57 1.630 2,000 Buy Up
09:41:55 1.630 7,000 Sell Down
09:41:48 1.630 14,000 Sell Down
09:40:56 1.640 32,000 Sell Down
09:40:09 1.650 9,000 Buy Up
09:39:03 1.660 5,000 Buy Up
09:38:39 1.660 4,000 Buy Up
09:37:38 1.660 4,000 Sell Down
09:37:33 1.660 50,000 Sell Down
09:36:41 1.660 77,000 Buy Up
09:35:37 1.660 15,000 Buy Up
09:35:08 1.650 10,000 Sell Down
09:34:45 1.660 2,000 Sell Down
09:34:40 1.660 5,000 Sell Down
09:34:34 1.660 30,000 Sell Down
09:34:19 1.660 20,000 Sell Down
09:34:11 1.660 2,000 Buy Up
09:34:04 1.660 50,000 Buy Up
09:34:02 1.660 10,000 Buy Up
09:33:46 1.660 3,000 Buy Up
09:33:08 1.660 1,000 Buy Up
09:32:21 1.660 6,000 Sell Down
09:32:15 1.660 9,000 Sell Down
09:32:12 1.670 5,000 Buy Up
09:32:05 1.660 16,000 Sell Down
09:30:59 1.670 5,000 Buy Up
09:30:41 1.670 29,000 Sell Down
09:30:38 1.680 6,000 Buy Up
09:30:27 1.670 10,000 Sell Down
09:30:17 1.670 10,000 Sell Down
09:30:12 1.670 20,000 Sell Down
09:30:11 1.670 5,000 Sell Down
09:30:03 1.670 10,000 Sell Down
09:29:39 1.670 5,000 Sell Down
09:29:35 1.670 8,000 Sell Down
09:29:19 1.670 5,000 Sell Down
09:28:04 1.680 45,000 Sell Down
09:27:49 1.680 8,000 Sell Down
09:27:48 1.680 5,000 Sell Down
09:27:46 1.680 5,000 Sell Down
09:27:29 1.680 3,000 Sell Down
09:27:11 1.680 10,000 Sell Down
09:26:58 1.680 10,000 Sell Down
09:26:55 1.680 8,000 Sell Down
09:26:54 1.680 5,000 Sell Down
09:26:37 1.680 18,000 Sell Down
09:26:13 1.680 5,000 Sell Down
09:25:40 1.680 2,000 Sell Down
09:25:22 1.680 15,000 Sell Down
09:25:21 1.680 80,000 Sell Down

Probably too long to see, but I believe from the intraday charts, it will be a nice pattern showing. I was monitoring it live, so I can try to explain what's going on. As far as it is going now, there are quite a number of heavy selling on this counter since it hit $1.75. If you notice, everytime when there's a big sell like 30-100 lots, it will be covered back very fast with very small volume like 5 lots, 10 lots etc. Especially when this happens, the significant drop of the price in celestial became null! With every big sell and small cover back, it seems to me that big buyers are trying to unload slowly, and cover back the price difference with small volumes. Remember I said before, small volumes can actually push the price up quick as well!
Here's another snapshot:

10:14:38 1.620 30,000 Sell Down
10:14:32 1.630 4,000 Buy Up
10:14:23 1.620 50,000 Sell Down
10:12:44 1.630 6,000 Buy Up
10:12:29 1.630 88,000 Sell Down
10:12:17 1.640 1,000 Buy Up
10:11:18 1.640 1,000 Buy Up
10:09:26 1.640 20,000 Buy Up
10:08:44 1.630 100,000 Sell Down
10:08:40 1.630 50,000 Sell Down
10:05:09 1.630 10,000 Sell Down
10:04:39 1.630 52,000 Buy Up
10:03:49 1.630 4,000 Sell Down
10:03:20 1.630 30,000 Sell Down

Next assumption that I'm seeing is, they are trapping the shortist. From $1.75, it has dropped to $1.62 now.

*LATEST UPDATE*
Ok, seems that heavy selldown is on china stocks, I have cleared out at $1.55 as I missed my chance at $1.65. My ideal cut price was at $1.60 and I wasn't disciplined enough to sell at a drop of 5%, thus resulting in my next sell at a 10% drop. The 10% was my second level so I won't want to take anymore risk. 5% was my initial warning, as to decide to cut or wait.