Fundamental or Technical Analysis? (3) - Re-posted

Read? Fundamental or Technical Analysis? (3)

Technical Indicators? (5) - Does it really matter in SG stock market?

Read? Technical Indicators? (4) - Does it really matter in SG stock market?


Read? Occam's Razor in TA and FA?

Learning from Chinese Kung Fu

The most advance strokes are simple movement to over-power your opponents's complex strokes.



Does Support and Resistance always work?


Show me any high liquidity stocks, Uncle8888 will show you that Support and Resistance is highly reliable and given enough time it always works. But, you will need to learn from the wisdom of Warren Buffet.

What is risk? The conventional definition of risk in finance literature is price volatility. But to super-investor Warren Buffett, risk is the permanent loss of capital.

Best of all, it is free! You don't need to pay $X,XXX to learn it. Any Tom, Dick, and Harry can learn to draw Support and Resistance in the next hour by asking Google.


Read? Who Moves My Market? - Part 4


Once you have mastered the combination of Support and Resistance with Price/Volume analysis. It becomes powerful duo. You can throw away other TA indicators.

Believe it or not. Up to you! Why pay to learn TA???

'London whale' bites US$2b off JP Morgan

Read? Have you spend enough time thinking on your money management stratgeies?

Createwealth888:


Another case of "They all ultimately made big bets and lost big time."

Bank suffers massive credit derivative trading loss caused by London trader's bet that corporations would not default

 

By

Neil Behrmann

 

JP MORGAN, which emerged from the financial crisis as America's biggest bank, has roiled markets by disclosing that it had suffered a credit derivative trading loss of at least US$2 billion.

The stock price of JP Morgan and other banks tumbled and contributed to further declines in Asia, Europe and the US yesterday.

JP Morgan CEO Jamie Dimon apologised in New York on Thursday night for "errors, sloppiness and bad judgment" which led to the loss.

The trader who carried out the trade in the complex credit default derivative market was Bruno Iksil, nicknamed "the London whale" and "Voldemort" after the Harry Potter villain.
His identity was flagged by several reports but not directly confirmed by the bank.

Uncle, Why your Chart so dumb leh?

At first glimpse, the above chart looked so remarkable simple. But, actually in this very simple chart it has already captured the most complex market actions by stock operators - Bulls, Bears and Sharks in play.

To be able to see the actions taking place below level of awareness will require a pair of keen eyes and a flexible mind. So you think the Chart is dumb?

Technical Indicators? (4) - Does it really matter in SG stock market?

Borrow the idea from La Papillion


** "BIAS" is a special feature in my blog where I get to say whatever I want with scant regards for your feelings. I'm not politically correct in this feature, so go ahead, judge me."


Read? Fundamental or Technical Analysis? (4)

Read? Technical Indicators? (3)

Read? Who Moves My Market? - Part 2

Read? Proprietary trader fined S$200,000 for manipulating stock market
Not enough? Want more?

Gohsip once commented:  Uncle8888,  you said "if you look at my charts posted with those technical indicators, they are just there to confuse people. LOL." You damn funny la!

If you happened to take a close look at my recent charts posted. I have decided not to be funny and stop confusing people.


Technical Indicators developed for which market?

Most of these common and popular technical indicators are developed by "ang mo" and they are tested and back-tested in the US markets to prove that these indicators are doable and may be reliable under certain market conditions.

But, you have to take note that these indicators are not developed for SG market and have not been proved by the developers that these indicators are still applicable here.

Well, sometime, I am really amused by some people who are trying to apply and test their TA knowledge on low volume stocks and blogging about it convincing. I think this is really a joke!

Especially for newbies to technical analysis, they may tend to trust and believe in some oldies showing off their TA knowledge in the cyber world.

Beware, if you choose to believe that these common and popular technical indicators which are NOT developed for SG stock market are still applicable and can be reliable here; then probably you need lots of money to exercise your brain.

Alternatively, you may be better off in learning to become pilot fishes and American cockroaches. Most likely you may be able to survive over market cycles.

Can retail TA traders compete against Algorithmic Trading by BBs?

Read? Are Shares finally recovering?

Can retail TA traders compete against Algorithmic Trading by BBs?

Createwealth8888 is thinking to be a Pilot Fish to be with them or to be a American Coackroach to hide from them?

Read? I become a Pilot Fish?

or

Be like American Coackroach?

Trade and survive like an American Cockroach. Eat when there is food to be found, and can survive without water for 1 month and without food for 3 months.

Fundamental or Technical Analysis? (4)

read? Fundamental or Technical Analysis? (3)

Can retail TA traders compete against Algorithmic Trading by BBs?

Source: http://www.student2trader.com/

What Is Algorithmic Trading?

Algorithmic trading is an approach whereby an order is entered into a computer program built based on mathematical models or ‘algorithms’. The models themselves can range from simple linear regression to more complex genetic programming and game theory based algorithms. The result is that the program created by quant specialists and software programmers determines the parameters of the order such as timing, price and quantity/volume.


Algorith mic trading is more so used by institutional investors such as investment ba nks and hedge funds, espec ially as it allows to control for ‘market impact’ i.e. to divide the order into blocks to minimize the shock to t he asset’s price and prevent market players from gue ssing the size of the trade.

Algorithmic trading can be simultaneously used with a number of investment strategies such as arbitrage, speculation or market making. In terms of arbitrage, an algorithm can be used to identify mispriced assets based on different asset pricing models such as the Black-Scholes option pricing model and take advantage of this mispricing, quicker (fraction of a second) and more effectively than a trader would. In that sense, algorithmic trading is different to a strategy such as discretionary trading, which relies on the trader’s own judgement.

Algorithmic trading has been increasingly becoming more widespread – currently close to half of all shares traded in the US are based on this strategy[1]. The firms that utilise algo trading generally develop their own in-house programs e.g. Sniper or Guerrilla both by Credit Suisse as opposed buying from a third party.

There is still considerable debate as to the pros and cons of "algo trading" – while it provides liquidity to the market, it has been blamed for higher volatility and the potential to exacerbate a downturn - in that case, “retail traders trying to exit a position quickly would have no hope of competing against a computer that can dump large quantities of stock in a split second”[2]. To cite a recent example – the May 6 2010 “flash crash”, whereby the US stock market crashed briefly only to rebound immediately after – the Dow suffered its biggest intraday point swing of almost 10%. In this case, one of the causes of the crash was the fact that algorithmic trading initiated a dump of the Procter and Gamble stock following an unusually large sell order for the stock. Due to controversies such as these, algo trading has been closely monitored by regulatory bodies.

Fundamental or Technical Analysis? (3)

"Much of technical analysis is magical mumbo-jumbo that people think will tell them where the markets going. And it never will. It's just a bunch of nonsense. Unfortunately, I've also participated in it" - Larry Williams


Read? Does Shorting always win in a bear market?

Last time, I  used to follow that honest Guru's cbox and blog everyday without fail. I was trying to learn from him as much as possible on TA since he is our local well-known full-time Chief Trainer and Chief Strategist in his School of Whatsoever Kung Fu Charting. He has even developed new indicators and modify/adapt some existing indicators to perform better in the current market environment.

Actually, I should thank him for helping me to STOP fooling myself in searching of better TA after seeing him clowning LIVE in front of my eyes in his blog with his failed trades.

I last heard he doesn't blog his trades anymore and his blog is dead!

Although I have stopped searching for better TA; I still do some simple TA for entries and exits so that I don't blame myself for making stupid mistakes when I failed.

Fundamental or Technical Analysis? (4)

Read? Fundamental or Technical Analysis? (3)

Not the first and will never be the last debate. LOL. Read? stocks moves because of BB, not bcos of your illusioned TA

I think we should treat TA, FA or both as Guidebooks and not as Holy Grail. There is no Holy Grail in trading/investing.

What can TA/FA do for us as Retail Trader/Investor?

It can help us in the following ways:

1. Guide us into believing that we are not making stupid mistakes when we lose money in the stock market.
2. Use them as excuses to comfort our sorrows/angers when we lose money in the stock market. (Don't believe me? Just go and visit more investment blogs, you may chance upon reading read something like .. "If I have done this or that, I may have not lose money", etc and you may find many IF's)
3. Use them as learning platform to further improve our trading/investing skills.

BTW, don't you think using two guidebooks is better than one?

Have you spend enough time thinking on your money management stratgeies? (2)

How many investors spent enough time seriously thinking about Money Management strategies?

I believe most investors tend to spend more time thinking on Method and trying to improve it; but don't forget that Money Management is important too.

Read? Have you spend enough time thinking on your money management stratgeies?

Two of Jesse Livermore’s Money Management Rules

3) Keep cash in reserve.

The successful speculator must always have cash in reserve.. .for exactly the right moment. There is a never-ending stream of opportunities in the stock market and, if you miss a good opportunity, wait a little while, be patient, and another one will come along. J.P. reach for a trade, all the conditions for a good trade must be on your side. Remember, you do not have to be in the market all the time. The desire to always be in the game is one of the speculator’s greatest hazards. When playing the stock market, there are times when your money should be waiting on the sidelines in cash.. .waiting to come into play. Time is not money — time is time, and money is money. Often money that is just sitting can later be moved into the right situation at the right time and make a fast fortune. Patience is the key to success, not speed. Time is a cunning speculator’s best friend if it is used wisely.


5) Take the profits in cash.

I recommend parking 50 percent of the profits from a successful trade, especially when the trade doubled the original capital. Set the money aside, put it in the bank, hold it in reserve, or lock it up in a safe-deposit box. Like winning in the casino, it’s a good idea, now and then to take your winnings off the table and turn them into cash… .the single largest regret I have ever had in my financial life was not paying enough attention to this rule. (Createwealth8888 likes the ideas of "Money in the Pocket " as money in the pocket is always safer than capital in the market.)

Have you spend enough time thinking on your money management stratgeies?

Read? Method, Money, and Mind

How many investors spent enough time seriously thinking about Money Management strategies?

I believe most investors tend to spend more time thinking on Method and trying to improve it; but don't forget that Money Management is important too.

From Larry William's Trading Rules:

5. Money management is the creation of wealth.


Sure, you can make money as a trader or investor, have a good time, and get some great stories to tell. But, the extrapolation of profits will not come as much from your trading and investing skills as how you manage your money.

I'm probably best known for winning the Robbins World Cup Trading Championship, turning $10,000 into $1,100,000.00 in 12 months. That was real money, real trades, and real time performance. For years people have asked for my trades to figure out how I did it. I gladly oblige them, they will learn little there - what created the gargantuan gain was not great trading ability nearly as much as the very aggressive form of money management I used. The approach was to buy more contracts when I had more equity in my account, cut back when I had less. That's what made the cool million smackers - not some great trading skill. Ten years later my 16-year-old daughter won the same trading contest taking $10,000 to $110,000.00 (The second best performance in the 20-year history of the championship). Did she have any trading secret, any magical chart, line, and formula? No. She simply followed a decent system of trading, backed with a superior form of money management.

6. Big money does not make big bets.

You have probably read the stories of what I call the swashbuckler traders, like Jesse Livermore, John 'bet a millions' Gates, Niederhoffer, Frankie Joe and the like. They all ultimately made big bets and lost big time.

Smart money never bets big. Why should it? You can win big on small bets, see #5 above, but eventually if you bet big you will lose - and you will lose big.

It's like Russian Roulette. You may well spin the chamber holding the bullet many times and never lose. But spin it often enough and there can be only one result: death. If you make big bets you are destined to be a big loser. Plunging is a loser's game; it can only set you up for failure. I never bet big (I used to - been there and done that and trust me, it is no way to live). I bet a small per cent of my account, bankroll if you will. that way I have controlled loss. There can be no survival without damage control.

Read more? Larry Williams - Trading Rules

Technical Indicators? (3)

Read? Technical Indicators? - Part 2

1) Have you ever wonder why there are so many technical indicators?

2) Have you ever wonder why Microsoft is developing Windows 7.0 instead of Technical Analysis software e.g. TA 7.0?

Any ideas why?

Time is the Cause, Volume is the Fuel and Price is the Result

By Benjamin Lee


There are many laws governing the financial markets just as there is gravity law to hold things together on the earth. One of the powerful financial market laws is summed up in this phrase "Time is the Cause, Volume is the Fuel and Price is the Result." There is a lot of market wisdom in this principle. If we could truly understand this, we could potentially unlock the mystery of the financial markets. In fact, if we look hard enough at the world that surrounded us, we could see patterns that conform to this universal law that works beautifully in the stock markets. In fact, I spent a lot of time researching into this phrase and would like to share some of my thoughts with you.


I will break down the whole phrase into three distinct parts and I will begin the exploration from the bottom up.

1. Time is the Cause
2. Volume is the Fuel
3. Price is the Result

Let us begin with the topic of price analysis. Stock price is something that most people are interested in. Very simple as to why they do so. Stock prices determine their profits in stock trading or investment. If you purchased company equity at $5 per share and it goes up to $10, you practically double your investment portfolio. The first thing when we look at the stock ticker tape, we notice the market price of the shares traded in the stock exchange.

Naturally many people think that the ultimate thing about stock trading is about the price per share. How limited that understanding is because we are looking at the stock market thru one dimension only.

In fact, stock market operators use the stock prices as the bait for drawing the public to purchase their shares of which they are desperately want to dispose. How to fish if there isn’t any bait to feed the fishes? There are many technical indicators which are wonderful technical analysis tools available ranging from simple moving averages to the famous MACD indicator, use the stock price as the base variable for the formula calculation.

Price indeed is a powerful variable to study in the analysis of financial markets as it is the direct result which all of us are interested in. Fibonacci, one of my favorite technical analysis tools, could be used to project potential retracement levels of the stock prices in the pullback. Another powerful market analysis tool available to us is the study of chart patterns.

Volume is the driving force of the rising stock price. This is where many people miss the point. A stock rises from $5 to $10 does not mean much if the volume is only 100 shares transacted. That would be just a $500 – $1000 dollar value shares transaction. So, the public often get excited when they see some barely active shares jump up 50% in a single trading day. I would put much emphasis on the volume analysis in the light of price analysis to get a better glimpse on what is happening behind the scene.

Stock market operators put great emphasis on volume rather on the stock price. The main reason is because the volume determines how many shares they can dispose to the public or how many shares they can accumulate from the retail investors.

Stock market operators are very smart individuals or collective groups of people. They too can engineer public interests by stirring the calm water by increasing the transacted volume thru buying and selling using different trading accounts. When the retail investors saw that a buyer purchased the stock at $10 with a single transaction volume of 100,000 shares, they immediately thought some rich guy is behind the purchase and therefore the stock will be going up in price. Unknown to them, that the seller of those 100,000 shares was actually the same buyer.

The retail investors got tricked into chasing the rising stock price as the fear of missing the boat and the greed of profits grip them. Therefore, we must pay much attention to the volume analysis to know what is going on behind the scene. What we would want to derive from the volume analysis is to whether the smart money is accumulating the shares or disposing the shares.

Therefore, a healthy rising stock price must be fuel with "healthy" volume. However, a declining stock price can happen without much volume. Shares fall at their own weight as though there is some gravity inclination.

Looking at the volume in analyzing stocks is likening to looking at the market using two dimensional views.

Time analysis in stock market is even uncommon especially to the retail investors. Time analysis provides what I called it as three dimensional views to the stock market. Everything is about timing. There is even timing in the breath that we take in every single moment.

Time animates everything surrounding us including us. This laptop that I used to write this blog is also animated by some clocking mechanism that provides the pulse to parse the instructions stored in the microprocessor. Let me tell you something which you might not hear before. When the time comes for the stock market to move upwards, it will move up regardless of the news that we hear surrounding us. Even if there are wars going on or earthquakes happening somewhere, if it is time to move up, it will move up. I repeat, it will move up. How many time we short on bad news only to find that the stock soars higher regardless of the "outlook" as perceived by our own understanding.

WD Gann once said the Time is the most important variable among Price, Volume and Time. As mentioned, Gann tools are some of the powerful timing tools to analyze the stock market timing. However, if you delved deeper, you might find some of the methods are not so conventional. I can only say that if you want to disprove that market theory, then you have to study it first and see for yourself.

In conclusion to the above post, I have basically chart out the entire learning path that any stocks, commodities, futures, options or forex traders should embark in learning more of the financial markets. Each section itself has vast division to explore further.

• Price Analysis
• Volume Analysis
• Time Analysis

"Time is the Cause, Volume is the Fuel, and Price is the Result. Over all these three, Time is the most important of all."


Read more? Volume and Price action?

Technical Indicators? (2)

Read? Technical Indicators?

Read? Who Moves My Market?

Read? Which Theory of Market Behaviours to believe?

Technical Indicators are Good?

The problem with most technical indicators is that they tend to have adjustable parameters. Some even have 2-3 parameters to adjust.

More often or more, we tend to keep adjusting these parameters and do some back-testing on our favourite stocks until we manage to "fool" ourselves that we got a "right" system.

But after a series of losing trades, you may begin to realize that the "right" system doesn't seem right anymore. You may then turn to the "Guru" who may have previously give you the ideas on these indicators for help.

The Gurus always will have some "useful" feedback or suggestions for you to re-adjust the parameters and to fine-tune the system and you are back to do more back-testing to get another "right" system.

Sound familiar, right? You like MACD and ADX. Me too. There are three parameters to adjust and have fun. But, I have stopped doing it for quite sometime.Good luck!

Fundamental or Technical Analysis? - Revisit 3

Arising from Genting stock price surge, there was another long debate on FA and TA stuff and someone (if I am not wrong, he is a market senior citizen) concluded that FA and TA are just crap.

I tend to agree and I think that I am not alone on these.

"Much of technical analysis is magical mumbo-jumbo that people think will tell them where the markets going. And it never will. It's just a bunch of nonsense. Unfortunately, I've also participated in it" - Larry Williams

Read old posting on? Who is Larry Williams?
 
"I am no longer an advocate of elaborate techniques of security analysis in order to find superior value opportunities." - Benjamin Graham

Read old posting on? What did he really say?
 
Read old posting on? Hey! You can't combine FA and TA - III
 
Read old posting on? Analyst's Company Report or DIY analysis? - It is just numbers guessing game and you can never, never get it right most of the time.
 
These are the reasons when I become more experience and more savvy in investment, I realize that I have to spend less time on stock analysis - TA and FA and still get positive returns from the market. This is known as investment productivity gains - more returns per unit time spent on stock analysis.

 

If you keep spending more and more time on stock analysis, then your investment productivity is low. It is time for you to wake up and improve your investment productivity.

Investing should be simple (not easy hor!) once you become savvy and experience in investment strategies and doing it well shouldn't be consuming so much of your life doing it even though you can claim you are enjoying it but can you confidently say that your family are enjoy it too? Stop kidding! This may be a big joke to them. Give a serious thought on it especially when you have young kids!

Improving your investment productivity is the way to go!

Hey! You can't combine FA and TA - III

Read? Hey! You can't combine FA and TA - II

Read? Fundamental or Technical Analysis? - Revisit 3

By now, you may know that I am NOT a big fan on either FA or TA. But, I believe that FA or TA is just part of the process of stock analysis. There is no need to go to the extreme of either techniques to be equally effective in making good returns on investment. Stock analysis is how we begin our investing journey and not the destination. FA and TA can play complementary role to each other and they are not mutually exclusive as most of the time our brains can handle conflicting views and reconcile them to arrive at more moderate views.

Read? Help me! I am still losing money in my Investment Quadrant - Part 1

Read? Time: The Most Precious and Fairest Commodity Of All

Why I am not a big fan of in-depth FA?

Because of Time. Yes, it requires too much time to do it well.

"Time is the most precious and fairest commodity of all. Kings or Peasants and everybody has the same amount of time, no more or no less. 24 hours a day" - Createwealth8888


In-depth fundamental analysis of a company business will require us to put in plenty of time, effort and energy to do it well especially when we still have full-time job. Some of us may even sacrifice their annual leaves to attend companies' AGM to get close to  the Management to ask a few questions here and there to clarify their doubts and to increase their understanding of company businesses and future plans and thinking that their attendance at AGMs may arm them with edges over others who are not doing it.

BTW, do we see institution investors at AGM? No, right! It is quite obvious that AGM is the not right venue to grill the Management.

As employees the number of annual leaves are limited; but some of us may instead of using their annual leaves to spend more time with family and especially young kids, they trade off their most precious and fairest commodity of all - time and spend it with the company's Management who are there at AGM during their official working hours.

Make no mistake about it. We definitely need to spend enough time, effort and energy on our investment to get better returns. But since I am not willing to spend too much time on FA, then I will need other way to make it up. I find that TA is a good mean to complement this lacking in FA to complete this stock analysis process and get the job done.

TA can help to complement the lack of in-depth fundamental analysis.

The whole market and stock sentiment is shown in the chart and don't under-estimate its usefulness. It does serve a definite and useful purpose. Thing that is useless to human being will soon be obsolete. Can you still recall those things are useful in your childhood days but they are not around now as they become useless?

Market is full of smart investors and money managers

Market is never short of full-time analysts assisting their portfolio managers to filter out good stocks. Market is also never short of full-time smart money mangers such hedge funds, private and institutional investors looking for better returns for their investment. When they uncover them, they waste no time and will jump into them without further delay. All these traces of buying and selling activities from the big boys will be captured in the chart. There is no way for the big boys to hide their footprints.

The recent price and volume surge in Informatics is a good example how Peter Lim and by his tons of followers drove this stock crazy and provide huge returns for its early investors.

The nice thing about TA is that it requires so much less time and effort to do stock analysis once you are experience enough to do it. A skillful chart reader can easily analyse the stock chart patterns for a buy, sell or hold decision in less than 5 mins per chart. It is possible to read many charts in one hour. How many companies can you analyse using FA in one hour?

Less but not More

When we become more and more experience and more and more savvy in investment, we should aim to reduce the amount of time, effort and energy required for stock analysis instead of spending more and more time into our stock analysis and then trade off the most precious and fairest commodity of time for other equally important thing in life especially for those with young family.

Unlike senior citizens or retirees who have plenty of spare time to attend AGMs for free makans or when there are no AGMs some of them may spend many hours at the beach grazing sea-waves or fishing where obviously they know there are so few fishes to be caught.

Diversify and Control the Risk

In addition, I mitigate the risk of picking up wrong companies due to lack of in-depth fundamental analysis by diversifying into more companies e.g. 20-25 counters in different sectors so that I could still afford  a few "bad" companies in my portfolio going bankrupt without any serious financial damage to the portfolio.

BTW, the top 20 blue chips with good dividend yield in STI rarely go bankrupt. So don't worry too much if someone happened to ask you as I can't recall any since the last two great STI bears. When the company doesn't go bankrupt sooner or later, its price may catch up or you wait long enough to collect dividends similarly you will get back your capital.

Volume and Price action?

You may often hear this: "without supportive volume a price movement has no conviction" or in another word due to demand and supply of the stock. More demand than supply i.e. more new buyers are willing to buy it higher. More supply than demand i.e. more new sellers are willing to sell it lower.  The new players are the key to drive the price further in either direction.

Some time, we have seen huge volume but with little price movement. Often in such cases, there are little or no new buyers and sellers but may be just transferring of share ownership among current holders. Without more new players coming to the market, price is unlikely to move much.

Similarly, can we say this: "high volume without supportive price movement has no conviction?".

What do you think?

Hey! You can't combine FA and TA - II

Read? Hey! You can't combine FA and TA.

What strategies does the Master Chess player good at?

 What strategies does the Master Soccer coach good at?

What strategies do they have in common?

Master Chess player and Master Soccer coach are both good at defence and attack strategies. They are less likely to depend  on one strategy to win many games. Most of the time to win many games, they have to be effective in deploying both defence and attack strategies.

Stock picking is part science (FA), part art (TA), part luck, part intuition, and always uncertain - "not precisely knowing."  (Author unknown)

FA can be thought as Defensive Strategy

In a defensive stratgey, you try to win by not Losing.

In FA, you defend your position by using strong protections such as high margin of safety, low debts, cash rich, low PE, high dividend yield etc ...

You believe that you are well protected in a foxhole staying calm and cool while waiting for good days to come. What happening outside the foxhole are irrelevant

You show no or little concerns over day-to-day stock price movement as the fundamental of a company seldom change every day.

TA can be thought as Attack Strategy

In an Attack Strategy, you try to win by Winning.

In TA, you identify your own set of winning patterns among the ever-changing patterns in the Market and attack it once you can identify it.

But you don't have much protections other than your own ability to recognize what is dangerous, what is safe what is opportunity and what is trap in the Market with whatever tools available and known to you?

Similarly, the concepts are true for retail investors who believe in income investing or profit realizing strategy. Their feeling towards falling and rising stock price can be different.


Just Dividends Only - Defence Strategy


You try to win by not Losing.

You win by collecting regular stock dividends but when stock price is falling you don't feel that you are losing as you are expecting another round of stock dividends coming soon.

When the stock price is rising, you may be happy about it but you can't really claim that you are winning yet.

Profit  Realizing - Attack Strategy

You try to win by Winning.

When the stock price rises to your profit target level, you win by realizing your profit and you begin to look forward to another round of winning.

When stock price is falling, you will soon feel that you are losing even though you haven't lost yet until you have cut losses.

Conclusion

Feeling good most of the time will fuel better investing success so I rather use both defense and attack strategy so that when stock prices are falling I won't feel that I am losing but when stock prices are rising I have won. Whenever I won, it is real money in the pocket. Shiok, right?

Fundamental or Technical Analysis? - Revisit 3

Read? Fundamental or Technical Analysis? - Revisit 2

Again and again. People will ask me for advice which technical indicators are good to use?

But I don't really use any "good" technical indicators for Entry and Exit signal. I really don't know which are the good ones.

I know most technical indicators are developed by Gurus who claimed that they are reliable and profitable if used "correctly". But, then how outcome so many new indicators were developed when the old indicators are reliable and profitable?

But I still need to know when to buy and when to sell so I use simple support and resistance to determine when to buy and when to sell.

Support and resistance are not known to be reliable. There will always be another new support or resistance once they are broken.

I know I always make mistakes in determining the level of support or resistance but just that I want to make a better simple mistake and that's all.

Fundamental or Technical Analysis? - Revisit 2

Fundamental or Technical Analysis? - Revisit

"Much of technical analysis is magical mumbo-jumbo that people think will tell them where the markets going. And it never will. It's just a bunch of nonsense. Unfortunately, I've also participated in it" - Larry Williams


Who is Larry Williams?
 
He is the author of nine books, and his latest book, The Mount Sinai Myth, is based on an archeological search for Mt. Sinai in Egypt, was later featured in Vanity Fair in a re-write by Howard Blum.[1] Royalties from his books go to a scholarship at the University of Oregon in honor of his college professor, Max Wales

Williams has created several market indicators including Williams %R, The Ultimate Oscillator and value measurements for commodity prices. He was the first recipient of Trade Stations Life Time Achievement Award. Williams won the 1987 World Cup Championship of Futures Trading from the Robbins Trading Company were he turned $10,000 to over $1,100,000 (11,376%) in a 12 month competition with real money. Ten Years later his daughter Michelle won the same contest