Archive for June, 2008
Both the DOW and Nasdaq indices were being bashed down last night in US due to various bad news. In short, the “W” shape that I spoke about in my blog yesterday was no longer true simply because it will not be a “w” shape any more. The spike up in Nasdaq the day before yesterday was more like a false break on hind sight.
Hence, we shall square off (i.e. lock in profit or cut loss) all our tech trading positions immediately. For those in Singapore, I have noticed that Venture had surged more than 5% yesterday and if you sell now (around S$9.95) you could still make about 3% after netting off the trading expenses. While this is not truly a great trading opportunity on hind sight, we shall be fast to react to new info.
We shall remain at the sideline with zero position and forget about the “W” shape for the time being. Nevertheless, we shall continue to monitor the markets in search for another good trading opportunity.
Master “The Essence of Stock Investment” and ride towards the journey of your financial freedom to be the “Master of Your Own Destiny”! Welcome to visit the #1 value-added stock and option investment education website in the world, www.master-rider.com!Disclaimer: Investors are investing at your own risk. Please read full disclaimer at the end of the blog or from the main page of the website.
June 27th, 2008
NW Teong
Despite my bearish view on the macros in my past few blogs, I feel that we should not miss out on short term opportunities (provided we can spot them).
Purely from chart point of view, tech stocks are poised to bounce strongly (from NOW onwards) and could last at least the next 3-5 trading days of course bearing unforeseen circumstances. Please see Nasdaq chart below:-
The Nasdaq has just formed the second base of a nice “W” shape. This is what we called a double bottom in technical analysis and is a strong signal for a reversal. Of course, nothing is 100% sure, what we can say is that the probability for reversal is very high when we see this signal. If we look at the SOXX index (see below chart) which is a leading indicator for tech stocks, it has a similar “W”
While I see this as a good short term trade, it does not indicate anything on the long term outlook. Hence, we shall not be too greedy and always remember to set a target price (set a trailing stop when positions already in profit) and a cut loss price (e.g. event risk). Never let your winning position to become a losing one.
Please note that you are responsible for your own trades and you are reminded to read the disclaimers at the bottom of the home page of www.master-rider.com. Good luck!
Master “The Essence of Stock Investment” and ride towards the journey of your financial freedom to be the “Master of Your Own Destiny”! Welcome to visit the #1 value-added stock and option investment education website in the world, www.master-rider.com!Disclaimer: Investors are investing at your own risk. Please read full disclaimer at the end of the blog or from the main page of the website.
June 26th, 2008
NW Teong
I have warned investors on the impact of a high crude price in my blog posted on 9 May 2008. I wonder how many have heeded my advice.
While the macro picture is murky at the moment, it is crystal clear that most bets (on the stock markets) are off if crude is able to stay at current price level (i.e. between US$125 to US$135 per barrel). The logic is simple, if the crude is staying at current price level for a sustainable period of time, it will have a dampening impact on most other industries. In short, it will single handedly drag down the world economy. The worst scenario is GREAT DEPRESSION. However, before we reach great depression, the world economy will slow down fast enough to force the crude price to drop to a more reasonable level (something below US$100 per barrel?). Then a new equilibrium is achieved among various parameters including the crude oil before we experience the global growth again. I do not know when this will be, however in one of my earlier blogs last year, I have “predicted” that the credit crisis triggered off by the US subprime loan will only be over by the end of 3rd quarter of this year. Thus, I feel that between now and the entire 3rd quarter, we will still witness a highly volatile stock market!
For those die-hard investors, you have to be very selective and invest only when great opportunities are present. Otherwise, it is better to extend your holiday (as mentioned in my blog on 9 May 2008). Before you do that, make sure you put your money in one of the safest instruments.
I am really surprise that most governments have done so little to help solve this (high crude oil) issue knowing its dire impact on world economy, and thus all mankind. Every one in the world should change our lifestyle IMMEDIATELY, i.e. do everything one can to conserve as much energy as possible. Government can surely help by building the right infrastructure and thus creating a more conducive environment for walking, cycling etc. It will be my dream to see all major cities to have special lane or path which have plenty of trees at both sides for cyclists. If the environment is nice to walk or cycle, I don’t see why people have to take a car ride to travel 300 meters from point A to point B in a city. This will increase the quality of life in a city as the air will be less polluted.
In fact, I am sad to notice that most governments are still being boxed down by own domestic affairs so much so that they have lost focus on these urgent issues such as preservation of environment, food crisis, energy issue etc. Current situation (earth quakes, heavy floods, etc) really warrants a top most attention from governments of major economies. If I have to use the color code to describe the degree of crisis now, it should be a RED ALERT now. At the moment, some people in different part of the world have died due to environmental havoc such as earth quakes, floods etc and many more are dying due to impending food crisis. Do we want to wait till the lives of half of the world population are being threatened before we take serious actions?
With the rate that we, human beings are destroying the environment, I wonder how long can we continue to breath in fresh air, drink clean water and eat un-polluted food. All of a sudden, an image of Martian with head gear and oxygen tank flashes across my mind……… This really sends a shiver down my spine!
Master “The Essence of Stock Investment” and ride towards the journey of your financial freedom to be the “Master of Your Own Destiny”! Welcome to visit the #1 value-added stock and option investment education website in the world, www.master-rider.com!Disclaimer: Investors are investing at your own risk. Please read full disclaimer at the end of the blog or from the main page of the website.
June 18th, 2008
NW Teong
In fact, most of us are going to get hurt if the inflation rate is carry on at the current rate of 4-5% per annum in most countries in Asia. We blame it on commodities which include both food and non-food commodities, but the real culprits are truly ourselves, the human beings.
I for one, am really surprise that no concerted effort have been made by the governments of influential economies to address the following global issues: food shortage which could cause severe famine, environmental issues due to massive de-forestation, and other abuses as well as general hardship for all mankind due to severe price hike in crude which translates to higher transportation cost. If there are actions already being taken, they are simply too little. If we do not take these issues seriously, we would face very dire consequences in the not too distant future. The key question here is that do the governments of the influential economies have the wisdom to realize these (potential) calamities and have the resolute to address these ultimate urgent issues? Do they have the wisdom to decide wealth (i.e. economy as well as political interests) over morality as well as humanity issues? More importantly address these issues with top most urgency?
We will surely see more natural calamities such as earth quakes, cyclone, tsunamis, floods and other erratic weather going forward. We all know that our only planet mother Earth, just like human beings’ body, need to strike a balance. While we need to eat right, rest and exercise well to stay healthy, the Earth needs to maintain its internal and external balance too. Unfortunately, we human beings have relentlessly abused the Earth in pursue of wealth. This is akin to investors’ psychology: the greed and fear! At the moment, we seem to be more interested in pursuing the wealth with total ignorance of the risks that associated with it. We build more roads, more houses, more cars, more planes etc to cater for our insatiable needs. I am afraid and truly worried that when we realized our silly mistakes, it might be too late to address all the related issues. If we are not at risk now, our future generations surely are. I feel rather helpless when I see people debate over food versus fuel. To me the answer is obvious! Without fuel, we can still survive but without food we will surely die, full stop!
There is huge amount of wealth being transferred due to high crude oil prices. While the rich ones continue to enjoy their luxury lifestyle, the poor ones are made even poorer. The rich ones can afford to cruise in personal jet plane, eat at the most expensive restaurant, the poor ones can only survive one day at a time. Let’s face it, we all accept the fact that life is never fair. However, I feel that we should have the basic morality to help our fellow earthlings who might be struggling to survive elsewhere. The very least we could do is to become a responsible earthling where we are mindful of fellow human beings (both current and future generations) and take good care of the only earth that we live in. If by giving up driving (or at least drive less) you can save some lives some where, then why not?
For a start, I feel that we should all (governments, private sectors and individuals) make a serious effort to save energy and be environmental friendly. I wonder, why can’t we have special lane for bicycles in major cities in the world? I think it is high time to encourage cycling as an alternative to driving. Governments can surely help by having a bicycle friendly transport system in place, such as special lane for bicycles on every road, sufficient parking facilities for bicycles and so on. Perhaps, governments can even consider giving out bonus or incentives (just like carbon credit) for cyclists who have traveled certain kilometers within a certain specified period of time. We may also allocate some R&D funds to develop “cycling cars”, i.e. cars that are light enough to be powered by human legs. Such cars should have rechargeable batteries that could be re-charged by our legs, These batteries can then be used to power the car for certain distance when our legs are taking a break. Obviously, there are many efforts going on to look for alternative energy sources. While the obvious choice is the solar energy, personally I feel that a combination of a mechanical (e.g. bicycle, better still a weather friendly bicycle!) and a human system will be a perfect combination. This can also help to solve the obese problem in many major cities!
Of course, we still need a good public transport system. However, we truly need multiple approaches to ease this problem.
Human beings use to have sharp common sense and great instincts; however these instincts are being blunted by our greed and fear, just like the way they have blunted our ability to make wise investment decisions!
Take actions now before some one is going to get hurt, really very hurt!
Master “The Essence of Stock Investment” and ride towards the journey of your financial freedom to be the “Master of Your Own Destiny”!Disclaimer: Investors are investing at your own risk. Please read full disclaimer at the end of the blog or from the main page of the website.
June 6th, 2008
NW Teong
