Collapse or Rally? The market ahead.

by **Starry** on 26 Sep 2007, 12:00

yes one portfolio should weigh more on asia pacific region to maximise returns. just like sector rotation, "region rotation" is a good strategy.

starry just a qns, if you can see the correction coming and based on your experience, would you buy put warrants early or do you buy when the correction starts? because the timing of purhase is important as too early might reduce your warrant value due to time decay factor. what was your strategy?

For the reduction in US equities part, I suggest reduce, not total elimination. There are people who email me and ask me should they totally exclude US equities. My answer is NO. Proper diversification should still be in-place.

Traditional allocation normally would say something like 40% US, 30% Europe, 20% Japan and 10% Asia ex Japan. But to follow this strictly would be a folly. Times have changed and the fundamentals governing the current global financial market is very different now compared to 20 years ago.

For the warrant part....I am a bit reluctant to answer this one. For myself, I would surely use a put warrant which I did in July (had sold off since for a small profit). But to use this, you need to understand warrants and its behaviour...not all puts are the same. If not careful, you might chose one that is above your risk appetite. There is also no one-size fits all for this strategy because it is always hard to determine the exact time for a correction to occur and no one knows the size of your portfolio you trying to protect.

If one do not know about warrants, it would be best to just ignore the noises and buy into value when the correction occur.

by **kanglc** on 26 Sep 2007, 13:25

This is like a private chatroom for logged in users.

by **wilfredling** on 26 Sep 2007, 13:28

Great stuff! Keep it up Starry. Don't let "nasty" emails discourage you for the good work. You don't own them anything.

by **dabcp2** on 26 Sep 2007, 14:32

Starry, Hats off to you. We owe you a lot.

:big15:

by **Awank** on 26 Sep 2007, 19:54

you really add a little bit of knowledge into my brain...thanks a lot..

well. given your splendid explanation, I should add more extra knowledge..but I m still newbie and does not know much about technical analysis. LOL!!

There is one thing I m a bit blur. you say the sign of correction is shown at end of june. but you mark the weekly chart at july instead...or am I wrong in reading the chart? sorry I am noob so reading chart in technical analysis is probably years ahead of me.

by **DIY** on 26 Sep 2007, 21:10

sabian wrote:
Starry wrote:
Aiya, why didn't Starry post the chart in July?

Because if I post that, people will not like it. It happened a few times before. Got some really nasty emails for the article "the storm ahead for Japan". I don't know who they are, but I realise that bearish articles create much more emotions then bullish articles. Probably it is due to our psychology where we feel more pain losing, then happy winning.

Anyway, I have no wish to stir those emotions especially when I am writing out of goodwill.

But for those who want to know, feel free to PM/email me and we can talk about that.

Hi Starry

It'd be great if pple can accept bad news as well as good news. Don't let the naysayers (pun intended) put u down?

After all, this is your baby. No one tells you what you can or cannot post. ok maybe suggest...?

Btw, i appreciate the Japan article a lot as well.

Hi Starry,

totally agree. Plse feel free to post all good and bad news coming. We are definitely not ostrich with heads in sand. Your article is always a must read as far as I am concern.

by **BlueFlix** on 26 Sep 2007, 21:58

Starry wrote:Got some really nasty emails for the article "the storm ahead for Japan". I don't know who they are, but I realise that bearish articles create much more emotions then bullish articles. Probably it is due to our psychology where we feel more pain losing, then happy winning.

These people are really idoits. If fear losing money then should value "early warning alerts" to enable one to exit the market early at the top rather than keep holding till the bottom...

I'll say it again - FOOLS !!!

When the secular bear comes, these pple deserve to lose everything...

by **lcy** on 26 Sep 2007, 23:05

Hi Starry,

Kudos once again for such a timely article for readers like me (im sure i am not the only one) who eagerly awaits your analysis!

Thanks!

by **Hulumas** on 26 Sep 2007, 23:13

lcy wrote:Hi Starry,

Kudos once again for such a timely article for readers like me (im sure i am not the only one) who eagerly awaits your analysis!

Thanks!

Dear Icy,

Yes, yes, yes.

by **StarLine** on 27 Sep 2007, 01:08

kanglc wrote:Very interesting and good write up.

I never know 200 day moving average is SO important! Next time I know when to load up more. I have been using MACD for a while but still can't see it the way you have described. Sometimes I see MACD turns downward but it rallies. For example, in the weekly DJIA chart, in June 06.

If you have the time maybe you should take up the courses offered by TerraSeeds ?
It will help you to see better.
It did for me.

::D

by **terrorboy** on 27 Sep 2007, 01:22

If you have the time maybe you should take up the courses offered by TerraSeeds ?
It will help you to see better.
It did for me.

you from Terraseeds right? Dun keh keh la....

But too bad la....we are all waiting for Starry to start his TA course. Somemore his fee is only 1/3 of that terraseed novice course. Also dunno terraseed good or not...no article nothing to prove.

Starry start your course la....after that all other TA school can close down..kekekekekeke

Also, I show your article to my broker....he also say no horse run. He ask me from which brokerage one..kekekeke

by **StarLine** on 27 Sep 2007, 01:33

terrorboy wrote:you from Terraseeds right? Dun keh keh la....

But too bad la....we are all waiting for Starry to start his TA course. Somemore his fee is only 1/3 of that terraseed novice course. Also dunno terraseed good or not...no article nothing to prove.

Starry start your course la....after that all other TA school can close down..kekekekekeke

Also, I show your article to my broker....he also say no horse run. He ask me from which brokerage one..kekekeke

Nope, I went to the courses offered by them.

You got good lobang ?
Does Starry have something on "Scholatics" mind my spelling ?
I think that course at TA is giving at $600/-.
You got cheaper one, maybe I join that course ?

What article are you talking about ?

::D

by **Starry** on 27 Sep 2007, 03:04

Nope, I went to the courses offered by them.

You got good lobang ?
Does Starry have something on "Scholatics" mind my spelling ?
I think that course at TA is giving at $600/-.
You got cheaper one, maybe I join that course ?

What article are you talking about ?

I think you meant stochastics? No, I don't have that, because IMO, it's pointless to study deep into just the stochastics. I know there is a course somewhere that offers only on Stochastics-candlesticks (and for 600 bucks?). But would you trade based on just stochastics alone? I think most would not. Probably the course say it can be done. And if it really can be done with just Stochastics, most traders will be millionaire by now. Did you see my charts using stochastics? No, I did not. Not because it's a bad indicator, but because it is not needed.

I would also like to warn against courses that give lesson on using indicators to trade. Might as well sell the software algorithm, plug it into your software and use that indicator to do mechanical trading. Don't need lessons! But mechanical trading so far has not been really successful. Most good traders are still the discretionary ones.

I wish more courses out there focus on the market physhology itself and not on selling courses that teach specific indicators, what are the rules (if X happen must do Y), methods, strategies, etc. All these will not work on the long run because the underlying force that drives the market is the market psychology. And that changes all the time. If you use a fix methodology or strategies or some indicator rules, what works today may not work tommorrow. Unfortunately, these are the easiest to sell for a lot of money because people are always drawn to methods, indicators and strategies thinking they are the holy grail to stock trading. And after awhile, they realise it doesn't work, then they go back for more courses and on and on. Good for the school, bad for the investor.

by **mkmk** on 27 Sep 2007, 03:36

Great article! I'll definitely spread the article around to my investing-friends.

by **Rational Investor** on 27 Sep 2007, 10:03

I think starry can quit his day job soon and set up an investment advisory newsletter. He will get many subscribers.

Either that or a big bank will headhunt you to replace their head of TA.
::D

by **Hulumas** on 27 Sep 2007, 11:37

Rational Investor wrote:I think starry can quit his day job soon and set up an investment advisory newsletter. He will get many subscribers.

Either that or a big bank will headhunt you to replace their head of TA.

Dear Rational Investor,

Oh no, by then, he may have no time to contribute the valuable and most needed posting here ::!:

by **joveyb** on 27 Sep 2007, 12:14

So Starry,

When studying an Index, using TA, you usually look at the following?
a. The price movement
b. Moving Averages: usually 20 days, 50 days and 200 days
c. MACD;
d. Volume
e. Chart pattern

What other fundamentals do you look into before you finalised your analysis

by **mac0309** on 27 Sep 2007, 12:22

Excellent article Starry,

Keep it up! : )

by **Hulumas** on 27 Sep 2007, 12:43

Collapse or Rally? The market ahead

Confirmed Rally!

by **Starry** on 27 Sep 2007, 13:05

joveyb wrote:So Starry,

When studying an Index, using TA, you usually look at the following?
a. The price movement
b. Moving Averages: usually 20 days, 50 days and 200 days
c. MACD;
d. Volume
e. Chart pattern

What other fundamentals do you look into before you finalised your analysis

you really trying to pick my brain huh? ::razz:

yeah, what you stated above are the stuff that I will usually check. Probably you should add in support and resistance as well. As you can see, they are very simple old school stuff; no fancy indicators, no fancy formulas, no fancy strategies and no impressive long list of indicators.

by **joveyb** on 27 Sep 2007, 13:21

Starry wrote:
joveyb wrote:So Starry,

When studying an Index, using TA, you usually look at the following?
a. The price movement
b. Moving Averages: usually 20 days, 50 days and 200 days
c. MACD;
d. Volume
e. Chart pattern

What other fundamentals do you look into before you finalised your analysis

you really trying to pick my brain huh?

yeah, what you stated above are the stuff that I will usually check. Probably you should add in support and resistance as well. As you can see, they are very simple old school stuff; no fancy indicators, no fancy formulas, no fancy strategies and no impressive long list of indicators.

No lah Starry, I worship you! You are the best person to learn TA. Not complicated but simply and important basic to check when doing TA.

by **StarLine** on 28 Sep 2007, 01:21

Starry wrote:
But would you trade based on just stochastics alone? I think most would not. Probably the course say it can be done. And if it really can be done with just Stochastics, most traders will be millionaire by now. Did you see my charts using stochastics? No, I did not. Not because it's a bad indicator, but because it is not needed.

I would also like to warn against courses that give lesson on using indicators to trade. Might as well sell the software algorithm, plug it into your software and use that indicator to do mechanical trading. Don't need lessons! But mechanical trading so far has not been really successful. Most good traders are still the discretionary ones.

I trade usually base other factors, not charts.

But I do want to learn,
and try use them to look for good timing on when to invest in,
and also when to get out.

by **fadeout** on 28 Sep 2007, 11:07

thanks starry! great article. shall pass it on

reminds me of the classic buffett,
"be greedy when others are fearful, and fearful when others are greedy"

by **Hulumas** on 28 Sep 2007, 11:31

reminds me of the classic buffett,
=D>

"be greedy when others are fearful, and fearful when others are greedy"[/quote]Dear Fadeout,

Based on the above axiom, you should buy KXD and Jishan today ::!:

by **fooz** on 29 Sep 2007, 01:57

wow... i am a amateur at this type of TA reports.. but i must say, this is very easy to understand for amatuers like me...

can we have more of this type of TA? hah...
n is there a TA course soon?

"Look at it this way. If you are holding US dollar now...there is only a few things you can invest into. Either stocks, bonds, gold, properties or just hold onto that US dollar. Bonds yield and US dollar is declining, so forget about that. Properties look very vulnerable now with all the housing issues. Gold would be a good alternative, but it will get more expensive when the USD slides further. Only stocks look really good now and with interest rates dropping, stocks look like a great alternative for investment returns."

i do hold onto some USD... hw do i invest into gold or stocks with the USD that i am holding onto?

Collapse or Rally? The market ahead.

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