Saturday, August 17, 2019

Recap - The simple Plan with commonsense

  1. How do you know the direction of the trend?
  2. How do you know the trend is in the progress of changing before change happen?
  3. How do you know the trend HAS changed?

How do we use charts to track and confirm the above 3 points?

At which stage(s) of the 3 points above, indicators will come into the analysis?

At which stage(s) of the 3 points above, indicators is not needed in the analysis?  

What are the action plans for the above 3 points in position sizing to manage exposure?

How do we swim with the flow?

How do we act upon the intermediate wave trend versus the overall major trend?

Even you can draw up a plan and action steps for the above, the biggest challenge will be how will you react or insulate against ‘News’ when your plan contradicts the news? With this dilemma, how will one react?

Will the “information or news” override the plan? Or will the plan IGNORE the news?

Ø  Emotion will continue a battle that each and everyone need to overcome. The FEAR and the GREED.
Ø  At market extreme point the Trend Direction is “felt” to be invincibly strong against you.

The problem will never arise when you chart strategy and the news are in synch. It is always a big problem when they start to contradict and your confidence in the system is not 100% strong.

When you have reached the 100% faith in the chart system, you will ignore the news. This is when you see light and start to shine.

In all my analysis of the 3 points mentioned earlier, I do not use Candles, Volume, Fibonacci and many other tools. Simple trend following tools for easy visual interpretations.

It is time, one should sit back and stop all the unnecessary micro-analysis of candle and the rest of rubbish and think over the 3 points above under a big tree ... Bodhi tree if you can find or Apple tree!!!

Depending on which side of the trade you are on. When the market is climaxing before any change happen, the extreme feel of FEAR or GREED will creep in and distort you mind. 

When the trend is reaching the extreme, it seems invincibly strong and unbeatable. Suddenly abruptly, the trend change from unstoppable strong to wimpy limp!!! 

I was and am always reminded by a wise statement that ,,,,,,, THE STRONGEST MOMENT IS THE WEAKEST MOMENT!!!,,,,,, 

The best time to start learning is when mistakes are made, losses are incurred. Human are subject to WINNERS CURSE and fail to learn or blind to learn or deaf to hearing when the trades immediately turn into profits without bad trades experience.

It is always best to experience set backs initially than to face adversity later which will be even more catastrophic financial exposure   

Wednesday, August 14, 2019

CPO and SoyBean Oil

There is a NETT positive correlation between CPO and SOYBEAN OIL in term of direction. It is not 100% positive correlation. The volatility magnitude of the are different despite the positive correlation. 

When you look at the monthly chart of the right, SoyOil did not retrace all the way down the bottom of the chart unlike CPO during the 2009 crash. Soyoil retraced exceed low during 2015 but CPO did not. To draw a total complete 100% correlation in magnitude is Super Dangerous.

On the weekly chart in the middle, towards 2018 end, CPO fall all the way to the low while SOYOIL holds up.

The Daily Chart on left, shows SOYOIL move up first while CPO continue south before finally makes a rally. 

Be cautious how one correlate CPO and SOYOIL movements, your timing can be off as shown on the charts above!

Friday, July 19, 2019

Crude Palm Oil (CPO) ..... the critical level

Market has -memory. Chart has the evidence and believe it or not CPO is at the critical period at this point.

Will the price go down or up or remain at this level????

1. Assuming it goes down and repeat some of the past behavior, where is the most likely target????

2. Assuming it goes up and instead of down. Where is the most likely target?????

No candles .... No many rubbish stuff that you learn ..... just purely simple indicators and zones.... and lines ....

There is no need for me to tell you what the trend is most likely to do next 3 months. Just wait for the show to unfold and perform in front of us.

Surely we have intra day and daily volatility. Will you get affected and swing bang whack by the daily volatility??? If you are affected than I guess, you still have to go back and look at all your idea and understandings about trend and reversal.

Let me say that I don't use candles and volume into the analysis. So you can eliminate 2 factors in your analysis.


Thursday, July 18, 2019

FEDS or Central bankers and Govt (antibiotics and steroids)

When the Central bankers or FEDS cut interest rates, it is like giving super dose antibiotics. When the antibiotics have lost its potency, the worries come. We have seen how Japan and Europe central banks cut interest rates to no stimulating effect on the economy.

Stupidly the RBA of Australia also embark on the same path. I don't know if these people are blind or dumb.

Now what is obvious, the Govt might need to come up with a "plan" to stimulate. This is like put in the "extra" or steroid. If this crap is going to work, the Govt would have done it long ago!!!!

How can you trust and have faith in the administration when all this rubbish plan come to table and approved!!!    

If there is anything that works, it would definitely be implemented long ago!!!! NOT NOW.

Now this is how much confidence I have with what I see around the world. Follow bad examples and hope it works!!!

Only a FOOL have a mindset like this!!

Monday, July 15, 2019

Anything economic positive news??

There is nothing positive in the horizon to tell and indicate to us the local and global economy is well. On the contrary non-USA have gone into panic mode to start another round of interest rate cuts.

The problem with toying around the interest rates also means you are toying with FD rates. This affects people who depends on interest rates income.  

Does savings in paying mortgages translate into more spending to stimulate the economy???? This is what the theory says BUT there is also another school of thought that it is also unlikely the nett savings from lower loan repayments can also means these people will continue to spend less????

Monday, July 8, 2019