Posted by DividendGuy67 > 2 weeks ago | Report Abuse

A few comments:

1. Technical analysis alone, has lower win rate. Simply because you can have 2 stocks printing the same chart set-up, but they have different businesses ranging from sound businesses to "goreng" stocks. So, if you want an easier trade, avoid the latter.

2. LCTITAN has sunk billions of good cash into expansion the past 3 years. However, Mr Market became more pessimistic, to the point that today, it values each RM1 cash invested at only 20 sen. It's low, but nobody knows if it's the bottom.

3. If price continues to fall, you will see worse news and worse financials reported AFTER price falls. The problem of speculating too big is that your hands are weaker. Weak hands tend to panic when price goes into a new downtrend, printing lower lows. The lower highs then play their emotions like violin - like a fisherman toying with a catch - pull them in (with lower highs), then let them go to panic (with lower lows), etc - to make them feel trapped to make them become desperate. And if you have a weak banker, suddenly, what was originally just a technical factor turns into a real fundamental business factor, to cause the business to go bust. By this stage, because you bet too big and trapped, you cannot get out. Therefore, for this type of plays, never bet the farm.

4. Nevertheless, with P/NTA of only 0.2 times, when it turn around, the rewards will easily beat KLCI returns. LCTITAN is now looking like a coiled spring that has been wound up even more tightly with each price fall. So, when it turns, there will be an incredibly strong fundamental tailwind. Combined with FOMO, the move up could be fast and strong. So fast, you might not catch it. Especially if you're like me who has a full time work and family life. A long green candle one day will put you off from jumping in.

5. 1.46 is only the first of many potential gap fills. There are higher gap fills shown in the chart. Therefore, I will never sell 100% at 1.46. Always leave something behind for higher gap fills. Nothing is impossible, even the upside.

6. To avoid watching markets, you may set a GTC sell order at 1.46, slightly below that, or slightly higher than that. Then, you don't need to monitor markets.

Posted by TheAlphaTrader > 1 week ago | Report Abuse

@DividendGuy... Good write up! looks like a good trade setup with excellent risk to reward proposition!