I am back !!!

Been 2 years since I last blogged. It's been interesting re-reading my previous posts. Certainly have growed in terms of trading knowledge and the way I trade.

3rd January 07 - Sector Rotation

Let's look at how the different sectors move in 2006 to possibly learn more about the insights of the stock market:

At the start of 2006, cyclicals, energy and small caps led the way. When the market hit a peak in May and then sold off, many investors rotated into more-defensive stocks including large caps, consumer staples and health care. But after the market's double bottom in June and July, the rally gathered steam again on the back of the old small-cap, energy and cyclical leadership. (excerpt from Business Times, 3rd Jan 07)

If you are interested to find out more, I have linked some of the above terms to website of relevant interest.

1st January 07 - Happy New Year!!!

As we bid goodbye to 2006 and welcome 2007, it's time to wish everyone a great year ahead!

May you achieve all of your resolutions and together let's pray for world peace :)

19th December 06 - Blood on the Streets of Thailand

Dec. 19 (Bloomberg) -- Thailand's government scrapped currency controls on international investors one day after the central bank imposed them and sent the stock market plunging by the most in 16 years.

The government is removing a requirement that banks lock up 30 percent of new foreign-currency deposits for a year, Finance Minister Pridiyathorn Devakula said in Bangkok.
"The stock market has fallen too much today,'' Pridiyathorn told reporters at a press conference.
"This is the side effect of the central bank's measure, but we have fixed it already.''

Thai stocks erased $23 billion of their market value today after the central bank said international investors must pay a 10 percent penalty unless they keep funds in the country for a year. The currency controls triggered declines in other emerging stock markets by highlighting the risks of investing in developing economies.

The rules would have limited international investors to using 70 percent of their funds to buy Thai stocks. The requirements stay in effect on other investments, including bonds and property, Pridiyathorn said

Thailand's SET Index tumbled 15 percent to its lowest since Oct. 29, 2004. The index sank 108.41 to 622.14. Morgan Stanley Capital International's Emerging Markets Index fell 1.6 percent to 881.31 as of 2:33 p.m. in London.

Restoring Confidence
``It's very untimely, it's unwarranted and it's badly thought-through,'' said Teng Ngiek Lian, who oversees $1.6 billion in Asian stocks at Singapore-based Target Asset Management in Singapore, before the measures were rolled back. ``If they don't quickly restore confidence, the damage can be quite bad.''

The currency measures came after the baht appreciated to the strongest in nine years, even though the central bank this month introduced steps to limit gains. The monetary authority on Dec. 4 asked companies and commercial lenders not to sell baht short-term debt securities to overseas investors.

The baht had the biggest two-day decline since April 2005 on yesterday's measures.
A military coup on Sept. 19 ousted prime Minister Thaksin Shinawatra and ended seven months of political turmoil. Prime Minister Surayud Chulanont, installed by the military junta after the coup, is planning record spending on roads, subways and other infrastructure projects.

International investors sold 25.1 billion baht ($699 million) more of Thai stocks than they bought today, the largest net sales since at least Jan. 4, 1999, according to data compiled by Bloomberg.

17th December 06 - British Pound looks set to SELL

In my opinion, I believe that GBP/USD has an attractive SELL set-up. Pls do click on the chart for more details.

Based on my system, the breakout to the upside on 12th December has failed terribly. So, for those who are still holding longs in this market, I hope your stops are in.

The next widely-watched support for the daily charts is @ 1.9594.

15th December 2006 - Possible Strength in Hang Seng

Based on my observation of the price action on Thur (14th) and Fri (15th), I think there are high odds of Hang Seng buying up next week.

I have made some $$ on Fri by staying on the long side of HK and have positioned for the next week (as shown in the chart).
What I am suggesting over here is only a buy set-up , so please do apply your own system for the possible entry, exit and stop. Have a great trade ahead :)

5th December 06 - 3 Little Words to Great Trading

Though comical in some sense, the parting words in Larry Williams' Long-Term Secrets to Short-Term Trading really sums it all up:

ALWAYS USE STOPS

1st December 06 - Retail Scalpers: WATCH OUT !!!

After talking to several professional scalpers, I realised that the retail scalpers are in a serious disadvantageous position compared to the professionals.

My reasons are as follows:

1) In scalping, time makes the difference a winning trade and a losing one. The professionals use platforms like Trading Technologies' MD Trader which buy/sell, place profit/stop using one click of the mouse. (http://www.tradingtechnologies.com/flash/tour/prop/mdtrader.html)

In addition, the execution speed is further enhanced due to the fact that the platform has direct lease-lines to the exchanges compared to the conventional internet-based connection which retailer platforms utilise.

2) The professionals also have alot lower costs (in terms of brokerage) as they are usually members of the exchanges they trade in. To highlight the dramatic difference, their breakeven could be only 0.1 tick compared to retailers' 1 tick.

To me, certainly the playing field doesn't look all that level to me :)

20th November 06 - S&P E-mini SELL 1402.00

A SELL call generated by the system on 20th November for S&P E-mini:
SELL Entry: 1,402.00
Target: 1,397.00
Stop: 1,407.00

Results of the trade is a 5pts loss, exited at 1,407.00.

19th November 06 - Finding the Right Mentor

It was said that in trading, or in fact all aspects of life, finding and learning from the RIGHT MENTOR is of utmost importance to one's success.

Do and Don't for finding the RIGHT MENTOR (quoted from fellow trader friend, Anna Wong)

DO: Seek out a mentor who can answer your questions and also give you advice other than just what market to trade. Also, seek a fellow trader with similar experience as you. Sharing ideas and discussing markets with a fellow trader is an enormous benefit.

DON'T: Shell out big bucks for someone who claims they will be your mentor and make you a big winner in futures trading in only a few short weeks or months. The old adage, "If it sounds too good to be true, it probably is" should be heeded in this challenging business.