Friday, November 28, 2014

Buffer and turbulence

How often can we sit and wait? How often are we mentally and emotionally wreck when we see the red numbers appearing? How often when a decision to exit with losses only result in market turning back to our earlier expectation?

The problems is mentally we are conditioned not to accept red numbers. A lot of this deals with our game plan. The ability to weather storms like this is not for everyone. The ability to sit tight and wait must be base on proper plan and strategy.

1. The confidence that when positions are initiated, it must be close to the TOP if SHORTS  and BOTTOM for LONGS. There must be sufficient buffer during this period.

2. When SHORT positions are accumulated mid-way rebound in a major downtrend, one must be able to verify that it is a temporary rebound and sufficient buffer to withstand until the downtrend resume or LONG positions are taken mid-way correction in a major uptrend, you must be sure that this is a temporary trend change with buffer to hold on to a temporary down draft until the uptrend resume.

3. Never over-gear your positions until you got no buffer to withstand all these temporary turbulence.

Sunday, November 16, 2014


In general, human wants to have a crystal ball or magic mirror that can tells the answer accurately in advance WHERE and WHEN. It is this desire that sets the stage for the fall of every market participants if not carefully and properly managed.

The first and most common question when you meet someone in a seminar is ... WHERE IS THE MARKET GOING TO TURN? Expecting a precise and accurate reply. A private conversation is never short of the same topic! When will this people start doing their homework and put a little effort to understand what market is all about and how it operates!

Whatever technique or system one utilize in the quest, there will be a period where the system will not work perfectly. IT is this period of draw down that makes the users disillusioned and start looking else where.

There are times when all the instruments will move in unison and at times decoupled from each other due to reasons published later.

To successful exploit markets, we need to approach the venture holistically and understand our objectives and analyze if our strategy is consistently reliable for us to deploy not to mention it must be comprehensible and simple.

Again human has the tendency to complicate matters until it is illogically incomprehensible leading one only see the tree but fails to see the forest! Microscopic analysis!

Until we are able to understand ourselves and map out a logical sensible road map, we will remain lock in yo-yo situation full of frustrations and agony. Fear when we take positions!

The greatest enemy is not the market or the intervention but OURSELVES! Our inability to understand our needs lead us to develop or follow methods that mismatch our INNER and the MARKET.

Do we use intra day data? Do we use End of Day? Do we use Elliot Wave? ETC .... Do we LONG? DO WE SHORT? Forget about trying to predict the market when we don't even know ourselves!     

Saturday, September 27, 2014

CPO - Chart

Are we going for a extended BULL run? What do the daily chart default indicators analysis tells us?

Where is the current GPS position versus the overall trend?

Are they more upside or game over? If there are more upsides, what is the Risk Reward Ratio?

Have a great weekend and productive next week! 

Saturday, September 20, 2014

CPO update - A quick review

Short and Mid-term BULLS have a great time goring the bears looking at the Daily charts on the left. Is this the end of a run or just a pull back correction before it scale higher? Maybe we are trading within the 2200 1900 band until a new trend emerge?

My analysis of the weekly charts did not imply the big bull is there. More likely it is a rebound after a great deep near vertical fall.  I am not be too optimistic to call the bear is over judging from my interpretation of the weekly indicators.

Where is the support (S) and resistance (R)? I do not subscribe to this idea of S&R believing firmly that they are just wild imagination of people who do not understand that trend is all that matters.

When the trend is set in motion in UP move, any resistance levels (if you believe there are any) will be broken. Similarly if the trend is DOWN, any support will be breached! I firmly believe that as long as the trend has not ended or about to end, I wouldn't want to waste time trying to figure out all the S&R using whatever techniques that you could or might have learn along the way.

A lot of the materials are purely academic reference knowledge. Bottom line is when it is time for the trend change it will change irrespective what news is reported or whoever is calling the market reversal. Believe in your chart and your analysis. What matters is your own profits!

Have a great week ahead and enjoy the ride!


Thursday, September 18, 2014

Collection of updates

1. As the old saying goes, “The more things change, the more things stay the same”, or as Einstein might have added, “We are at a relative standstill.”

2. Shakespeare’s play – the plot is always the same, only the actors change. It is just a question of time.

3. There is no BUBBLE in the stock market without optimism.

4. The Roman Emperor Diocletian (284-305AD) introduced passports. Not to travel from one country to another, but to be able to travel at all AFTER you were verified that you owed no taxes. Today, the US has introduced a law that if you owe the government $50,000 in taxes, they can revoke your passport until you pay. Wonderful how history repeats.