Thursday, April 30, 2009

Action 20090430: Short FKLI May 2009 Contract At 986

(I am recording my trading. The followings are my trading actions and records. As good traders, we should keep a good records of all the details like points of entries, reasons of the actioin;long and short, stop loss levels, profits and loss and commands etc. )
Date: 30 April 2009 (Open Trade)
Action: Short FKLI May 2009 Future Contract
Shorted Price: 986
Volume: 2 contracts
Stop Loss: 990
Reason To Short:
1) The Stochastic of 30 minutes chart was down
2) Price broke below the moving average low (MAV Low in purple color line)

Date: 30 April 2009 (Close Trade)
Action: Long to close position
Longed Price: 990
Volume: 2 contracts
Loss: RM500 [(990-986+1)xRM50]
Reason To Long (close):
1) Stopped Out
Comment: The price was stronger than expected. After the losing trade, I stayed aside for the rest of the day to watch the price action. And it is a holiday tomorrow (1 May 2009 Labour Day).

Note:
1. One points of FKLI (KLSE Future Index) = RM50
2. Commission needed for buy and sell is RM50 so we need 1 point to break even
2. Margin (Minimum Deposit for holding overnight) = RM3000
3. I have RM33,275 as deposit and now RM32.775 after the loss of RM500

Tuesday, April 28, 2009

Party Over?


FKLI April 2009 Future Contract closed at 966 with the low of 962 which is near the moving average low of 958. There is high chance that the market will slow down the plunge for the time being. Sideway could be ahead of us. Swine Flu kids in, this is a chance for market to rest at least for now. I am looking into the price action very closely. If it could further go down and below the moving average low, I will get ready for shorting the market all the way down. Let's see the development in the few days.
I will not assume what the direction of the market will be, I will only let the price movement (action) to lead me.

Monday, April 27, 2009

Action 20090423: Long CPO July 2009 Contract At 2511

(I am recording my trading. The followings are my trading actions and records. As good traders, we should keep a good records of all the details like points of entries, reasons of the actioin;long and short, stop loss levels, profits and loss and commands etc. )

Date: 23 April 2009 (Day1)
Action: Long CPO Futures July Contract
Entry Price: 2511
Volume: 1 contract
Reason To Long:
1. Broke above recent high of 2501 registered on 20 April 2009
2. Daily Stochastic is still up even at overbought area
Stop Loss: 2449 (Maximum loss RM1600 = 64 points) (2513-64=2449)
Profit Target: No Target Yet

Date: 27 April 2009 (Day3)
No Action: Holding the long position at and getting ready to exit using 30 minute chart.
Comment: Techinically, the market is bearish now after the price plunge 104 points. The daily Stochastic turned bearish (Red Line closed under Blue Line). I wanted to exit the market with better price, so I used 30 minutes chart to make decision. Now, Stochastic of 30 minutes chart is at oversold area, there is high chance that the market will rebound. I will close the position when it rebound.
My Stop Loss remained: 2449



Date: 28 April 2009 (Day4)
Action: Closed my long position of 2511 at 2514
Price Shorted: 2514
Profit: 1 point = RM25 ONLY!
Comment: I closed the long position as the daily stochastic is now bearish. I am quite happy even I made so little. I could have lost more if I got out yesterday. It is important to focus on the game plan rather than the money.



Note:
1. One points of CPO (Futures) = RM25
2. Commission needed for buy and sell is RM50 so we need 2 points to be break even
2. Margin (Minimum Deposit for holding overnight) = RM8000
3. I have RM33,350 as deposit and the balance is RM 33,375 after the profit of RM25

Saturday, April 25, 2009

Record All Trades

It is important to keep good records all our trades just like doing business keeping proper accounts. So that we are well aware of what we did, why we did and how we did. These records are good for reference and study in the future. We loss, we want to know why we loss and when we had big wins, we also what to know how we got them. More over, when we have string of losses, we might want to see our past winning records to encourage and inspirer us. And when we have successful trades, we also want to read the previous losing trades to remind us of not to let the profits going over our head.

Entry Date, Entry Price, Stop Loss, Potential Profit Target, Volumes (lots or contracts), Reason Of Entry, Reason Of Exit and Comments (It is very useful for future reading)

Tuesday, April 21, 2009

Action 20090421: Long FKLI April 2009 Contract At 974

(I am recording my trading. The followings are my trading actions and records. As good traders, we should keep a good records of all the details like points of entries, reasons of the actioin;long and short, stop loss levels, profits and loss and commands etc. )

Date: 21 April 2009 (Day1)
Action: Long
Price: 974
Volume: 2 lots
Reason to Long:
1. The price broke the recent high 974 which registered on 16 April 2009 and closed at the high of 975.5. This is a bullish candle stick pattern called bullish engulfing.
2. Daily Stochastic is still up even it is at overbought area.
Stop Loss Level: 945 (5 points below recent low of 950)
Profit Target: No target yet.

Date: 22 April 2009 (Day2)
Action: Holding
Reason: The price held well above stop loss level of 945. Tomorrow, I am going to minimize my loss by limiting the losses to RM1600 (5% of my deposit of RM 32250).
Stop Loss: 959 (975-16)
Profit Target: 1st 980

Date: 23 April 2009 (DAy3)
Action: Short to close my position at 978
Profit: RM100 (975-978-1=2 points)
Reason To Close:
1. It was a sideway market at that time based on 15 minutes chart so I decided to closed its 'pick' 977
2. Stochastic also look short term overbought.
Comment:
1. I should not change my position in the middle of the trade since I had my stop loss level at 959 or below 965 (Yesterday's Low). So it is important to STICK TO MY INITIAL POSITION.

Note:
1. One points of FKLI (KLSE Future Index) = RM50
2. Commission needed for buy and sell is RM50 so we need 1 point to be break even
2. Margin (Minimum Deposit for holding overnight) = RM3000
3. I have RM33,250 as deposit and the balance is RM33,350 after the profit of RM100.

Monday, April 20, 2009

KLSE Could Be Near The TOP


There are two reasons that I think the market could be near the temporary high:
1) KLSE is near the top of the parallel line (in white)
2) Stochastic has been in over sold area
3) Daily Volume are among the highest

I will get ready to pick up some stocks with good fundamental for long term investment. (I define 'long term investment' as investment for more than 1 year).

Potential SideWay Ahead For CPO JUly 2009



Looking at the price movement of CPO Jul 2009 Daily chart which closed at 2446 with the high of 2501 and failed to close near the high (refer to the two charts), the market could head into consolidation.
I wanted to long today when the price broke above the recent high of 2488 registered on 15 April 2009, and I was ready if the price could close near the high, But it failed. I did nothing today.

Saturday, April 18, 2009

Self Control

In trading, it is not so much on how accurate we could predict the market rather it is the self control that matters. Our prediction may be right many times but without the self control, sooner or later we will lose. And when we lose, the emotion gets in. We start doing silly things. Our money will just fly away piece after piece until it is too late.

Wednesday, April 15, 2009

Action 20090415: Short CPO July 2009 Contract At 2400

My Trading History:
I am recording my trading. The followings are my trading actions and records. As good traders, we should keep a good records of all the details like points of entries, reasons of the actioin;long and short, stop loss levels, profits and loss and commands etc.

Action: Took Profit at 2348
Profit: 50 points x RM25 = RM1250 [2400 - 2348 - 2 (for commission) = 50 points]
Account Balance: RM32000 + RM1250 = RM 33250
Reason Of Closing The Trade:
1) Stochastic of 30 minutes chart has been in oversold area
2) Usually, the market will not just end (the recent rally)


Date: 16 April 2009
Action: Hold the short position at 2400
Profit Target for tomorrow 17 April 2009: 1) 2276 & 2) 2174
I will take profit if the prices hit the above profit target. For the time being, I do not know which one I will use. I will wait and see for tomorrow the price move then decide.



Date In: 15 April 2009
Action: Short July 2009 CPO contract
Price: 2400

Reason of Shorting:
1) Daily stochastic has been at the overbought area and now the fast line (in red) closed below the slow line (in blue).
2) I based on candle stick pattern called Bearish Harami; open low then hit high and closed below the opening price.
3) I based on 30 minutes chart of CPO July 2009 contract to get in as in closed below both moving average of high and moving average of low.
Stop Loss Point: 2494 (6 points above the high of yesterday 2488)
Profit Target: No target yet

Note:
1. One points of CPO = RM25
2. Commission needed for buy and sell is RM50 so we need 2 points to be break even
2. Margin (Minimum Deposit for holding overnight) = RM6500
3. I have RM32,000 as deposit.

Monday, April 13, 2009

Watching & Waiting


CPO future July 2009 contract has been hitting the high with 3 straight white candle (bar). I am watching very closely for correction and waiting for opportunity. If market can go up further hit the recent I will long or else I will short if the price could hit the previous two day lows.

Saturday, April 11, 2009

KLSE WEEKLY WATCH


Looking at the price action, KLSE weekly is at the ascending side way pattern, it could mean the end of the long serious down trend blown by credit disaster in US. I am waiting to buy (invest) in stocks of my choice when the markets correct.

How I Trade Forex

My Trading Steps (FOREX)
I outline my trading steps for one, to help me to follow the steps every time I trade forex and two, to share my steps with others. If you have any comment, please feel free to give.

Step 1. Determine the daily trend using Stochastic (14,3,3). If the stochastic is up, I will look for opportunity to long (buy) only.

Step 2. Wait for the 4 hourly chart to hit over sold area of Stochastic (14,3,3) and go long (following daily stochastic direction) when the price rebound from the over sold area. OR Whenever Stochastic (4 hourly) closes over (fast line closes above slow line) becoming bullish pattern.

Step 3. Place Stop loss at 5 to 10 pips below recent low when long and above recent high when short.

Step 4. Limit Losses: The maximum that I can loss for any single trade is 2% of my total deposit, for example, $100 for deposit of $5000.

Step 5: Take Profit: a) when prices hit the 4-hourly Stochastic over bought area when long or over sold area when short. b) when prices hit higher low in the up trend or when prices hit lower high during the down trend.

WHO SAY WE CANNOT BORROW MONEY TO INVEST IN STOCKS AND SHARES

It is a common believe that we should not borrow money (margin) to buy stocks and shares. Well, I think they are death wrong. Currently, Malaysia bankers are offering the market 5% or less interest rate for margin account of investing in stocks and shares. If we were to buy stocks that can generate 5% or more dividends with the companies making profit year in year out. There is no reason why we should not buy those stocks. The 5% or more dividends are well enough to cover the cost of interest rate and we left with capital appreciation. Why not? Using bankers' money to make money. This is what the riches are doing anyway.

Friday, April 10, 2009

Never Change The Plan In The Middle Of Trading

It is a bad idea to change the trading plan in the middle of the trade. Stick to the initial trading plan no matter what happen; win or loss; Stick to your stop loss level, stick to your trading amount or contract size (never add losing position) and stick to the same time frame like 15 minutes chart, 30 minutes chart, 1 hour chart or daily chart etc.

Thursday, April 9, 2009

KLSE At OverBought Area


I am waiting for KLSE to go below 907.87 registered on 8 April 2009 then I will short future index FKLI April 2009 contract. As stochastic is at the overbought area (refer to chart).

ONLY TRADE ACTIVE MONTHS FOR FUTURES MARKET

I will only trade the active months for future. The active month for FKLI is spot month (current month) while CPO future is 3rd future month. For example, I would trade CPO June contract when I am in between 16th March and 15th April. And I will switch the month to July when the date turns 16th April till 15th May.
Note: The switching month for CPO future is 15th. Most traders will trade the active month.

Wednesday, April 8, 2009

CPO Future Daily Chart Update


20090408 CPO future June 2009 contract closed at 2165 with the high 2173 and low 2153. As shown on the chart, it is at the sideway situation. I would buy (long) when breakup the resistant or sell (short) when price breaks below the support.

30 Minutes Chart For Intra Day Trading CPO Futures

I prefer to use 30 minutes chart for intra day trading CPO futures. CPO future starts trading hours at 1030am to 1230pm and 0300pm to 0600pm. By using 30 minutes chart, I am getting full price bars rather than incomplete bars like using 1-hour-chart, 2-hour-chart and 4-hour-chart etc.
15 minutes chart is not consistant enought specially when the daily volume is low.

Tuesday, April 7, 2009

15 Minutes For FKLI Intra Day Trading

I use 15 minutes chart for intra day trading FKLI as it starts at 9:45am. If you were to use 30 minutes, 60 minutes or 90 minutes etc. you would have one or more incomplete bars.

FKLI 15min Chart: SIDEWAY WAITING FOR BREAKOUT


20090407 FKLI April 2009 Contract closed at 917.50. Looking at the pattern of the 15 minutes price movement, the market is at the side way. I am waiting for the break out (Ups or Downs) to do my action. (Refer to chart)

Sunday, April 5, 2009

Share Investment Is Better Than Property Investment

I always believe that investing in shares is better than investing in properties or fixed assets. My reasons are:
1. liquidity: Shares are traded daily on stock exchanges (for example Bursa Malaysia) and they can easily be bought or sold. As for fixed assets investment, there is no 'fixed assets exchange' in any countries, even if there is, the buyers and sellers are not as many as stock exchanges.
2. Ease Of Transection: It is really cost effective to buy and sell stocks and shares. There is no lawyer required. The commission is only 0.7% (could be lower) of the stock value and stamp duty of RM5.00 based on Bursa Malaysia.
3. Ease Of Collection: Dividends are directly banked into account without hassle. Imaging that the rental incomes from the asset investment will have be collected monthly; calling, appointments, collection and banking in etc..

I understand that fixed assets investment seems more stable as there is no price quoted every day like stocks and shares. The prices of fixed assets investments tends to move slower. We don't really feel them since there is no daily quotes. However, considering the above three reasons, I would suggest that one should look into stocks and shares investment. Of course, we have to train ourselves to get use to the daily price fluctuating.

The richest man in the world, Mr. Warren Buffett created his wealth all from stocks and shares investment. If fixed assets investment is so good, why is that the top five richest men are not from fixed assets investment? Think about it.

Saturday, April 4, 2009

Bursa Malaysia - Rushing In To Invest Before Too Late?

KLSE COMPOSITE INDEX DAILY CHART
KLSE composite index has been up for the last three weeks from the low of 836.51 (20090313) to the high of 910.96 (20090404) up almost 80 points - see chart for more. My clients kept on asking me the same question of if we should invest now.
Fundamentally speaking, a lot of economic data have shown a positive turn around, or a least the economical data are not same bad as most people think they are.
Technically speaking, the monthly stochastic is bullish and weekly stochastic has been bullish.
I would suggest that the market is a least bottoming up now. We should get ready to buy in your favorite stocks when the daily stochastic turns oversold (currently is at overbought territory).