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Monday, December 24, 2007

Market on holiday mood

The KLSE had been on a quiet mood over the last week due to the many holidays. The KLCI continued with its down slides earlier part of the week as a continuation from the previous week's fall. As mentioned in the last post, CI gone down to 1382.44 to close the gap that was created on the 30th Nov due to the listing of Sime Darby. CI closed the week above the 1400 psychological level at 1403.56, however, the volume was low, averaging about 600+ million daily which is not very encouraging, probably due to the holiday mood.

This is a good time to take a rest and review the trading results over the last one year. Be truthful to ourself when reviewing, look back at the mistakes that we made and make an improvement on it. Share trading is a learning journey, one can improve his trading skill over time, provided that the person is always willing to review his / her own mistakes, learn from it.

I take this opportunity to wish every one a better and profitable 2008, Merry Christmas and Happy New Year!

Monday, December 17, 2007

Weak market, correction downward

(Click to enlarge)
The KLCI closed weak at 1403.41 on last Friday(141207) after it hit the record high of 1449.70 a week ago. It was down 30.63 points week-on-week. Market players took the opportunity to lock in their profits. Stock markets worldwide was down since 121207 due to a rate cut by FED that was lower than what was anticipated by the market. Daily volume of Bursa Malaysia has shrunk to around 600 to 700 million shares, which is a bad sign indicating a weak market, and more correction ahead is anticipated. In view that 1423 did not hold, and CI actually penetrated 1400 to the low of 1396.45 before a last minute push up to close at 1403.41, KLCI may further correct downward to the 1380 level to close the Gap that was created due to the listing of Sime Darby. Strong support may be found around 1350 and 1330 level. If these two level could not hold, then the KLCI will actually turn into bear phase. Hopefully the year end window dressing activities could help CI maintain at the current level.

Stock wise, there aren't many stocks that are good for trading. Some of the strongly trending stocks are BJCorp, BJCop-LC, and BJland. Gamuda shows a strong reversal up due to the revival of the double-tracking project, with a potential target of 5.10.



To all my Muslim readers, I wish all of you Selamat Hari Raya Haji; and to my Christian readers, Merry Christmas.





Disclaimer: The above is not a recommendation to buy or sell, all suggestions mentioned are purely for academic study purposes for our trend trader club members only, and the author may have personal interest and position in some of the examples mentioned. Any losses incurred if you were to trade base on the study examples above is solely your own responsibility. Do consult your dealer before taking any action.

Monday, December 10, 2007

KLCI lacking participation

The KLCI started Friday(071207) with a positive mood, the CI touched the record high of 1449.70 within the first twenty minutes of the session, and thereafter profit taking sets in and sent the CI down to the low of the day at 1431.77, an 18 points retracement from the peak but closed off low at 1434.04 (-6.35, -0.44%). Losers outnumbered gainers with 542 to 275. Volume traded was weak at only 790 million shares, this clearly indicates the local market lacks participation from the mass retailers, the CI's gain over the last few days was merely due to the gain in a few heavy weights.

Technically, Friday's price action has lead to the formation of a bearish engulfing candlestick which indicates distribution, especially happening near the top. The KLCI may continue to retrace downward to the 1423 level, which may provides support for the immediate term. For the medium term the 1400 psychological support is important. For the long term, our KLCI is still on the uptrend. Base on the trend channel, we are looking at the very possible target of 1500, this target may be achieved by the first quarter of 2008.

Some of the stocks that may offer short term trading opportunity are Kianjoo and Pohkong.
















Disclaimer: The above is not a recommendation to buy or sell, all suggestions mentioned are purely for academic study purposes for our trend trader club members only, and the author may have personal interest and position in some of the examples mentioned. Any losses incurred if you were to trade base on the study examples above is solely your own responsibility. Do consult your dealer before taking any action

Thursday, December 6, 2007

Marching towards 1450

I mentioned in the post on 291107, "hopefully the listing of SD (now SIME) will kick-off a new round of rally", it is now coming true, thanks to the heavy weight counter. Our KLCI started Wednesday (051207) with a slight dip to 1415 due to Dow's overnight fall of 65 points, and very quickly CI shrugged off the fear and march towards 1423, the previous all time high. The attempt to break the record high was finally successful at 3.30 pm and CI reached a high of 1431.69 intraday, and finally settled at 1427.77 (+11.96, +0.84%). Market breadth was strong with 602 gainers against 241 losers, and volume was mild at just about 1 billion shares traded.

With the CI breaking through 1423, we are seeing the high possibility that KLCI will march towards 1450 before we say bye-bye to 2007. While the heavy weights are leading the way, the second and third liners are also showing signs of reversal after almost one month of correction. Some of the counters worth watching are MPHB, JAKS, Sunway-WB and Dataprp.

















Disclaimer: The above is not a recommendation to buy or sell, all suggestions mentioned are purely for academic study purposes for our trend trader club members only, and the author may have personal interest and position in some of the examples mentioned. Any losses incurred if you were to trade base on the study examples above is solely your own responsibility. Do consult your dealer before taking any action.

Monday, December 3, 2007

KLCI up, but market was actually down

The listing of Sime Darby (or Synergy Drive as mentioned previously) on Friday, 301107, actually lifted the CI to open at 1408.09, a 33.77 points up. However, the CI did not continue with the up move, it only managed to climb to the intraday high of 1408.32, and thereafter was heading south direction to hit the low of 1391.72 and finally closed at 1396.98, up 22.66 points. The KLCI was up, but in actual fact the market was down, reason being Sime Darby alone, being the largest market capitalization counter on the Bursa Malaysia has contributed 23.40 points gains to the KLCI with its Rm2.10 gain. If we take away the contribution by SIME, the KLCI actually closed at 1373.58 (-0.74). Technically speaking, the candlestick formation coupled with a gap on Friday was not a good sign, despite the fact that CI was up, the general market actually took opportunity to take profit (or sell on strength), the confidence was not there yet. The general market sentiment was actually weak on Friday with majority of the counters down, losers lead gainers with 469 to 339, and volume done was only 970 million shares which indicates the general market lacks enthusiasm. Hence, CI may continue to slide down back into the sideway consolidation mode.

On the regional side, Hong Kong's HSI was back above the 28000 mark, and Singapore's STI has also climb back above the 3500 mark. These two marks was important for the respective indexes.













As for the DJI, it continued with its rebound from the recent low of 12,724 to close at 13,442. DJI may face some resistance at the 13,500 to 13,600 level.





From the movement of the indexes, most markets will move into the sideway consolidation phase, maybe this is a time to take a rest.

Disclaimer: The above is not a recommendation to buy or sell, all suggestions mentioned are purely for academic study purposes for our trend trader club members only, and the author may have personal interest and position in some of the examples mentioned. Any losses incurred if you were to trade base on the study examples above is solely your own responsibility. Do consult your dealer before taking any action.