As a continuous enhancement to my technical skill, I've borrowed a book on candlestick from NLB on yesterday, titled "Trading Applications of Japanese Candlestick Charting" by Wagner & Bradley L. Matheny. I know sometime is kinda difficult to find a book on candlestick, so I've actually make a reservation for it.
After browsing through it, I found the book quite comprehensive, showing much more reversal pattern that I've seen from the website. I think it is worth borrowing and I've extended my borrowing even on the very day when collected it. This will give me more time to read to and understand it more thoroughly. I would like to learn more about its history, application and most importantly its formation, esp. the reversal patterns.
As I've been using candlestick for my charting, I think it is good to have a better understanding on it and if possible, master it. I strongly believe this will further enhance my technical skill.
If anyone has came across any other books on candlestick and think that it is very good, please let me know. Thanks.
Showing posts with label Investment Strategy and Principle. Show all posts
Showing posts with label Investment Strategy and Principle. Show all posts
Monday, September 3, 2007
Tuesday, August 21, 2007
My Recent Study on Indicators
During the correction period, I've continued to study more indicators for my trading. Other than MACD, I've been seeing some analysts using ADI/ADX (Average Directional Index) as well. So I went to do some study on this and I've found that it is quite useful and decided to use it along with MACD for some confirmation purposes.
Recently, we saw a bullish reversal sign on STI, meaning the market is more stable now, but the correction is still not over yet. To me, the correction is over only when there is a bullish divergence on MACD or the +DI crossover the -DI for ADX......so still need to wait for a while.
Currently, I'm still trading with a lesser percentage of my capital and as the market is still quite volatile, I'm using stochastic and the candlestick for faster dscision.....still trying to learn more on candlestick.
If you have any comments or advise, please feel free to write me a mail and I'll really appreciate that.
Recently, we saw a bullish reversal sign on STI, meaning the market is more stable now, but the correction is still not over yet. To me, the correction is over only when there is a bullish divergence on MACD or the +DI crossover the -DI for ADX......so still need to wait for a while.
Currently, I'm still trading with a lesser percentage of my capital and as the market is still quite volatile, I'm using stochastic and the candlestick for faster dscision.....still trying to learn more on candlestick.
If you have any comments or advise, please feel free to write me a mail and I'll really appreciate that.
Thursday, August 2, 2007
How to Tell Whether the Correction is Over?
How to tell whether the correction is over?
A good question. For me, I'll depend on the STI movement. Once the MACD shows a positive convergence/divergence or STI manage to find its support level at its 20d EMA again, I'll consider the correction is over.
At the mean time, I'm shortlisting those strong fundamental stocks that has fell signifanctly. I believe these stocks will move back very fast once the correction is over.
If everyone has any recommendation, please feel free share with me. Thanks.
A good question. For me, I'll depend on the STI movement. Once the MACD shows a positive convergence/divergence or STI manage to find its support level at its 20d EMA again, I'll consider the correction is over.
At the mean time, I'm shortlisting those strong fundamental stocks that has fell signifanctly. I believe these stocks will move back very fast once the correction is over.
If everyone has any recommendation, please feel free share with me. Thanks.
Thursday, March 15, 2007
Charts, Analysis and Theories
During this period of time, stock market is volatile and is very risky to make any trading or investment unless you have a good tool that help you to make the right decision. I'm still doing a few trades here and there but with minimal amount. At the same time, I'm currently gathering more informations and readings to improve my knowledge and trading skill. This will definitely helps me when market start to pick up again.
Few months back, I've been to a website just to read up on the technical analysis and indicators but did not really browse around. This few days, I went into this website again and found that it has a lot of informations which I've missed earlier on. It includes different theories and strategies in shares investment; using chart to identify trend and patterns; using of indicators, using of the japanese candlesticks and so on. It also share about Fundamental Analysis.
I would strongly recommend those who are new in shares investment or who are interested in charting and technical analysis to visit this website. It will definitely helps you.
You may find the link to the website from the my blog under "Charting Softwares and Related Website" and click on Stockcharts.
Happy Reading!
Few months back, I've been to a website just to read up on the technical analysis and indicators but did not really browse around. This few days, I went into this website again and found that it has a lot of informations which I've missed earlier on. It includes different theories and strategies in shares investment; using chart to identify trend and patterns; using of indicators, using of the japanese candlesticks and so on. It also share about Fundamental Analysis.
I would strongly recommend those who are new in shares investment or who are interested in charting and technical analysis to visit this website. It will definitely helps you.
You may find the link to the website from the my blog under "Charting Softwares and Related Website" and click on Stockcharts.
Happy Reading!
Wednesday, March 7, 2007
Anyway to "Predict" the Arrival of Correction?
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)
Monday, March 5, 2007
My Strategy During This Correction Period
During this correction period, price may looks attractive but market remain violatile. Contra players may be clearing their holdings within this two days.
Will stay at the sideline for a while until the market is more stable.
Will stay at the sideline for a while until the market is more stable.
Tuesday, February 20, 2007
Driving a Car and Trading in Stock Market
Trading in Stock Market is Like Driving a Car. Please see the followings:
1. Determine your destination.
(Select the potential stocks using FA)
2. Plan your route with the help of map.
(Set the strategy for entry and exit using TA with the help of chart)
3. Follow the your planned route with the help of road signs.
(Follow the strategy and look out for signal from the indicators)
4. Drive with care and watch out for the traffic.
(Invest with care and have a knowledge on the market)
5. Watch speed limit and do not break the rules.
(No chasing of price and do not break the rules set)
6. If miss the turn, do not worry, use the next turn or find the way back with the help of road signs and map.
(If miss an opportunity, wait or look out for the next one)
7. Reach your destination safely and sound.
(Exit when the exit signal is shown, cut loss or take profit)
8. Gain confident, knowledge and proceed with the next destination.
(Learn from the previous trade and proceed with the next one)
1. Determine your destination.
(Select the potential stocks using FA)
2. Plan your route with the help of map.
(Set the strategy for entry and exit using TA with the help of chart)
3. Follow the your planned route with the help of road signs.
(Follow the strategy and look out for signal from the indicators)
4. Drive with care and watch out for the traffic.
(Invest with care and have a knowledge on the market)
5. Watch speed limit and do not break the rules.
(No chasing of price and do not break the rules set)
6. If miss the turn, do not worry, use the next turn or find the way back with the help of road signs and map.
(If miss an opportunity, wait or look out for the next one)
7. Reach your destination safely and sound.
(Exit when the exit signal is shown, cut loss or take profit)
8. Gain confident, knowledge and proceed with the next destination.
(Learn from the previous trade and proceed with the next one)
Fundamental Analysis Vs Technical Analysis
Which is necessary? Or both?
For me, both are equally important to me. Of course that depend whether are you a short-mid term investor or a long term investor.
For a short-mid term investor, both FA and TA is very important. FA is to help you to find company that has good prospect and future growth; whereby TA helps to determine the entry and exit point. This will help to reduce the risk and maximise your profit.
For a long term investor, FA will be more important as you need to ensure that the company has a good prospect and future growth. By investing in a growing company, you may see your investment grow as well.
For me, both are equally important to me. Of course that depend whether are you a short-mid term investor or a long term investor.
For a short-mid term investor, both FA and TA is very important. FA is to help you to find company that has good prospect and future growth; whereby TA helps to determine the entry and exit point. This will help to reduce the risk and maximise your profit.
For a long term investor, FA will be more important as you need to ensure that the company has a good prospect and future growth. By investing in a growing company, you may see your investment grow as well.
Thursday, February 15, 2007
Share of Thought for Stocks Investment
Just to share some of my experience...........Like some of you guys, I used to chase stocks when it is moving up and when it starting coming down, I thought it is just very short term so I'll tried to average down. Yes, I did make big bucks but sometime lose even more. After learning from the hard way, I manage to find out more about share investment (truely investment and not gambling)...how to win in trading of share more often and lose less.
Firstly, you need to find out more about the company, its historical financial report and its future expansion/contracts and the industry that it is in as well as the performance of the management.....and we called this Fundamental Analysis (FA). Select stocks that has good FA.
Secondly, study the Technical Analysis (TA)....base on the indicators, understand the support and resistance level, break out etc. The indicators will be able to tell you when is a better time to enter and exit.
Thirdly, put your emotion aside ie. fear and greed (this is a killing factor most of the time).
Fourthly, for start, it is more advisable that you set up a simulated portfolio (without using actual $)..."trade" with the strategy for enter and exit that you have set.....modified a bit here and there after you start "trading". Practise make perfect. Once you feel comfortable with your strategy and the result, you may start trading with real $. For trading with real $, start with smaller amount as when dealing with real $, our human factors (fear and greed) will come in. Until you overcome our human factors, then you start to increase your investment amount.
This is what I will do if I were to start all over again....which is impossible. Therefore, I'm sharing it esp. to those who are new in trading and for those who are unfamiliar or wonder why you keep losing money. Just some sharing from many of my lessons learnt. Happy Trading!
Firstly, you need to find out more about the company, its historical financial report and its future expansion/contracts and the industry that it is in as well as the performance of the management.....and we called this Fundamental Analysis (FA). Select stocks that has good FA.
Secondly, study the Technical Analysis (TA)....base on the indicators, understand the support and resistance level, break out etc. The indicators will be able to tell you when is a better time to enter and exit.
Thirdly, put your emotion aside ie. fear and greed (this is a killing factor most of the time).
Fourthly, for start, it is more advisable that you set up a simulated portfolio (without using actual $)..."trade" with the strategy for enter and exit that you have set.....modified a bit here and there after you start "trading". Practise make perfect. Once you feel comfortable with your strategy and the result, you may start trading with real $. For trading with real $, start with smaller amount as when dealing with real $, our human factors (fear and greed) will come in. Until you overcome our human factors, then you start to increase your investment amount.
This is what I will do if I were to start all over again....which is impossible. Therefore, I'm sharing it esp. to those who are new in trading and for those who are unfamiliar or wonder why you keep losing money. Just some sharing from many of my lessons learnt. Happy Trading!
Monday, February 12, 2007
My Investment Strategy
5 Steps Investment Strategy
1. Selection
Find Stocks with healthy financial status and have good future demand. Financially, I'll look at the NAV, EPS, PE, Revenue, Profit Margin, ROE and sometime Yield. You may find the under valued base the financial report and growth stocks base on company's report as well.
2. Preparation
Set rules for entry and exit, and wait for the buying signal. For technical analysis, I'll look at Price movement, Volume, RSI, stochastics and MACD. (For start, you may set up a simulated portfolio to test your strategy without using any real money. You may modify your strategy until you get a positive results.)
3. Initial Entry
Once the buying signal is shown, buy in smaller quantity first. Maybe half or one third of your intended amount.
4. Full swing
Once it starts moving up and show more positive strength, you may buy in more.
5. Selling
Sell once it hit target selling price, selling signal is shown or when cut loss level is hit.
It looks simple but most important is our own discipline. Need to follow strictly to the rules that have been set. Especially come to cut-loss, when the level is hit, we just need to sell. Don't be affected by our emotion ie. greed and fear, as this may be our killing factors.
1. Selection
Find Stocks with healthy financial status and have good future demand. Financially, I'll look at the NAV, EPS, PE, Revenue, Profit Margin, ROE and sometime Yield. You may find the under valued base the financial report and growth stocks base on company's report as well.
2. Preparation
Set rules for entry and exit, and wait for the buying signal. For technical analysis, I'll look at Price movement, Volume, RSI, stochastics and MACD. (For start, you may set up a simulated portfolio to test your strategy without using any real money. You may modify your strategy until you get a positive results.)
3. Initial Entry
Once the buying signal is shown, buy in smaller quantity first. Maybe half or one third of your intended amount.
4. Full swing
Once it starts moving up and show more positive strength, you may buy in more.
5. Selling
Sell once it hit target selling price, selling signal is shown or when cut loss level is hit.
It looks simple but most important is our own discipline. Need to follow strictly to the rules that have been set. Especially come to cut-loss, when the level is hit, we just need to sell. Don't be affected by our emotion ie. greed and fear, as this may be our killing factors.
Subscribe to:
Posts (Atom)
