Rules of Investment
What are the stock and market movers? What should we do?
SimonShuet
Publish date: Tue, 02 Feb 2016, 08:45 AM
SimonShuet
0 16
The Blog Depicts the Writers View of the Market as seen from his 20 years experience.
It is inspired to help investors and traders to have an alternative view in all our endeavour to be better market investors.
It is inspired to help investors and traders to have an alternative view in all our endeavour to be better market investors.
"The recent local market harmonic is very heavily driven by crude oil price and forex. The local political situation has thrown some spinners in predicting the already turbulent market.
So what should be do?
We should look for a solution to anchor on. The solution maybe to
1. Sell all export stocks and wait. If you hv a profit all the better, if not then treat it as cut loss
or
2. Sell all the export stocks and and convert the sales to plantation or tech stock which which maybe the beneficiary of demand
or
3. Don't do anything on current export stock holding and see what happens in the next 2 days
or
4. Keep the export stock and avg down with each support gap
To help you decide, the historic rate against the USD as below. We are back to 21 Aug 2015 closing exchange rate.
http://www.exchange-rates.org/history/MYR/USD/T
I hv personally chosen to wait as my stocks in hand are all fundamentally sound and I believe the EPS will prevail this round when the results are out the end of the month. In doing so I may top up at significant support to create more leverage for up swing. As market is very dynamic and driven by more traders than investors in the coming days, speculation, rumors, panic selling and cut loss will come into play while its actual performance is far from the truth.
As mentioned in my earlier post (ref. Reading the Body Language of the Market Part1) where many pointers are coming from DJIA and I also mentioned the 2 level of support. If you agree with me that most market direction pointers are coming from US based on DJIA, then China can act as the catalytic mover which we have seen over and over again. The below gives you can idea of why the main foreign reserves of China in US bonds and my statement above.
https://en.m.wikipedia.org/wiki/Foreign_exchange_reserves_of_China
if so, will US Presidential Election be a positive drive up to the market and economy?
I believe so it will, especially if Donald Trump continues to win the poll numbers big and eventually becomes President !!! This is because US wants to be great again in the global economy and in fighting terrorism amongst others. In the words of wisdom, "You cannot fight terrorism by having human rights or or being humanitatrian, it is perceived as weakness to the terrorist.....or neither can you be a global business powerhouse again if the President depends majority on his economic advisor" US needs a strong business leader who isn't afraid to act and give away diplomacy when it is needed.
Hope the above will help all to decide, .....while my opinion is a personal choice, the facts should serve as a guidance.
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Discussions
1 person likes this. Showing 24 of 24 comments
No need tomorrow to talk 3 talk 4...already happening and money puling back liao??
http://www.themalaysianinsider.com/malaysia/article/financial-scandals-forcing-state-investors-to-sell-london-properties-says-f
2016-02-02 11:07
Seriously collect export ...a lot ppl talk talk liao sure ringgit will drop
2016-02-02 11:14
If money pull back like that, they win profit but lose exchange. Like that no Hong Bao
2016-02-02 11:22
With China buying very key assets in Malaysia from land bank to oil refinery (PD refinery not just any refinery one which does 156k bpd and with 90% consumed locally) they hv added another stake in their global holding and into the world market. Even with TPPA in place a global movement of supply chain can bypass many eyes
http://www.malaysiakini.com/news/329025
2016-02-02 11:41
Today a lot of us are playing share market like a chess game. We react on each of the move market throw at us. Because of the current economic situation, we take safe haven of Friday, or public holidays in case of undesirable news. We sell at slightest non conformity to market movement and we deliberate to buy cheaper and cheaper.
How do we explain
1. Why the market moves when it moves unexpectedly while we wait to buy cheaper?
2. Why most of the time when we sell the stock move up?
Here are some of the possible reason
1. When a situation becomes oversold with high volume "panic selling" we hv to identify whether it is genuine panic button pressed or due to non conformity.
The first thing you should do is to determine the buyer and seller demographics. Eg. If the daily queue volume is avg at say 1Million, and you hv an immediate single seller at 100k volume for a share price of RM2.00, this requires attention. If the same seller subsequently goes down and sell at buyers' price, the buy rate will drop. This maybe deem as premeditated selling.
2. However if the seller never queues at sell but goes straight into buyers buy queue with sizeable volume shared in (1) likely it is panic selling esp after a price stalemate over a long period. I am not concern with this type of queue especially when it happens without reason at between 10 - 12.30pm queues. Most of the time it is this selling that prompt the market to rebound very quickly.
3. A good market is one which allows daily equilibrium to set in between 9am to 11am earliest before committing a buy or sell. The 9am to 11am are deemed most emotional to morning news and concern.
4. In most cases, "panic selling " situation garners a lot of support esp during this turbulent economic environment. So many experience players here will decide whether a rebound is in the horizon and avg down or follow as with herd mentality. This differentiates the rich players from the experience investor/trader.
5. An experience trader plays within the band of support and resistance. He does so by not committing entirely at any one support or when it infringes a resistance. This is because his rule as trader is 10% to max 15% at any one breakout must be a sell. This is why I say it is a traders market more now!
6. What about investors then? My interpretation of trader is holding trades of within 3 mths (max 6 mths) while investors are anything above 6 mths. All this is very much inline with GDP reporting (2 Q) and financial performance reporting every Q. Hence investors need to see 6 mths into the future in terms of economy, political, catalyst. we will hv a likely change of Bank Governor in Apr, whilst quarter performance 2016 in Mar, US presidential run up till Nov 8, etc
2016-02-03 08:39
down without no bottom... this time for sure, beware any false uptrend
2016-02-03 08:52
i always get uneasy when someone says anything about 'reading my body language' - reading or staring? lol. anyway, reading and timing the market? that's a dangerous way to make money.
2016-02-03 08:56
USD strengthening against MYR
Crude oil dropping again
DJIA falling
In summary we are ALMOST back to 2 weeks ago.
its not all doom and gloom
Crude oil fall helps balance world inflation
Strenthening USD ensure our export
DJIA falling gives us direction
2016-02-03 08:58
oil will be USD 20 later... maybe this month... many predict this, just make your move now
2016-02-03 09:10
who follow window dressing buy last month now all cry n bang head to wall....
2016-02-03 09:16
Thank you Mr Simon. You say 2 days I wait 2 days. Now I can smile a little
2016-02-03 17:16
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This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
kingcobra
are u so very sure regarding export related stocks???????? are u god??????????
2016-02-02 09:06