My answer : YES.
Many may question...Really? Are you sure? How?
After going through the correction in May 06, I started to find ways of identifying signals and indications before it arrived. This is to help me to prepare for the next one so that I can jump off the boat on time.
I think its good to share my findings, so that more people may be saved from future falls.
Base on May 06 and Feb 07 (please see the charts above), we can see some similarities. Both were supported at its 20d EMA, once they fall below their support level, you can see the correction is there.
Base on May 06 and Feb 07 (please see the charts above), we can see some similarities. Both were supported at its 20d EMA, once they fall below their support level, you can see the correction is there.
On 27 Feb 07, STI had fall to its support level (before closing), and with the DJI future shows a fall of 50+pts, which mean very likely that DJI will open lower that very night. Together with the fall of Shanghai Composite (down 8+% before STI close), there was a very high chance that STI will fall below the support level the next day, which strike off the correction.
The next question you may ask..... so in this case, did you escape from the crash?
My answer is yes and no. Yes, because I've sold almost all my short term holdings. No, because I'm holding on to some for long term. My another findings...no matter long term or short term, just throw everything when correction is coming and collect everything back after that.
This is just my sharing. Good luck!
(Please feel free to comments)
1 comment:
Too simplistic. Your historical data testing is too little, making use of only 2 corrections. Should back test at least 5 years.
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