Latest Posts By elfinchilde
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| 27-Oct-2008 17:04 |
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things every retail investor/trader should know
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reposting the last part from my latest blog post here. for those fretting about their losses. in case the big picture has been forgotten. http://elfinchilde.blogspot.com/2008/10/course-updates.html (full post for the interested) ------------------ personally, for me, nothing beats the live experience. more work, perhaps, but when you are there, live, living and breathing the market, you fully understand it from its basic principles, and you can react accordingly in any given situation, rather than relying on a computer system, which will invariably fail: because how can artifical intelligence map the entire depth of the human soul, its shifting, complex topographies of emotions, intellect and creativity? so for those staring at losses now, relax. Money is important, yes, but it is not the entirety of life. Rather be a person rich in friendships, experiences and all the intangibles that make life rich, than a lonely person in a huge mansion with nothing but fistfuls of dollars, with no real friends, and whom everyone deserts in times of trouble. the richness of your life is not measured in the numbers of your portfolio but by the number of your friends who will come to your aid, freely, without question, when you are down. the market is a game. and as Benjamin Graham says, Mr Market is your slave, not your master. Always, you control your reactions to the game; so never let it become the be all and end all of your life. Because in the very big picture of life, this is just a passing dream. Engage in it, but have the ability to disengage, too. cheers from an elf! |
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| 27-Oct-2008 15:33 |
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things every retail investor/trader should know
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baseer, the carry happens all the time: it is on-going. some borrow, others return. think of the yen as a bank, basically. anticipate the unwinding: when the charts show the UJ is going down. esp when weekly/monthly uptrend lines are broken. CWQuah, yah. the upslope line is very important. and we've broken it. haha. the bull run from 1998 is over for the STI with friday's break. and yea, just did the STI chart and about to post on my bloggie... concur on the 1515 level; i have it on mine as 1478-1518. :) expecting to hit it tmrw when we play catch up. THe DJIA is the significant one. if we break the 8,000 (or 7,9xx, to be precise), it's a break of the uptrend from the 1940s. off to do a bloggie now. cheers! |
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| 24-Oct-2008 18:25 |
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just to complete the lesson, cos esp for newbies, while learning, it's easier to see with benefit of hindsight than when the process is ongoing. tho the aim for a trader is to be able to extrapolate beforehand, the past is important, since once learnt, you can apply the patterns looking forward next time. so that when the same setup occurs, you know that with greater probability, more often than not, it'll happen one way. http://elfinchilde.blogspot.com/2008/10/false-rebound.html --on thursday this was what i had posted. today's action shows precisely what a false rebound means, and why, if your aim is longterm, you'd not take a false rebound no matter how tempting it looked thurs afternoon. (the low of course, fell lower than expected. my mistake for not doing the recalculation sooner. updated sti charts posted today.) have a good weekend all, and don't fret. since whether you worry or not, the market's still going to move anyway. so if worrying doesn't help, may as well save it. |
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| 24-Oct-2008 16:49 |
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zillion, thanks. :) it's perhaps less the actual period of time but more the consistency of practice. how close are you to the market; how much of a realist are you (ie, do you actually see what is happening, or are you only seeing some ideal in your head, that 'it is a good stock', 'it will go up/down' etc.) a lot of discipline; perhaps the most disciplined of the fields to survive in, since this is a job with no safety net. (not a gahmen job. haha.). where your greatest demon is yourself, really. the rewards are there however, if you dare to take the risk. singaporeans need to get over their mentality of always looking at reward only and not at risk. i've more or less been trading for 10 yrs already. but went fulltime only this year. so i practically live and breathe the markets (not just stocks). i do find it boring to just trade tho; which is where teaching gives more intangible satisfaction.  afterall, what's the hurry in making all the money all at once, and neglecting to live, forgetting about the ppl who care for you. Quality, not quantity of life is impt.
baseer, how often does what happen? the carry breaking? lk at your UJ 4H chart, from 0000 EST. what do you see. :) i'm personally holding an EU short from 12815; locked in the UJ short from 9620, entered again just now at 9409. just fyi only ah. caveat applies as usual. watch for final bell throwdown on stocks. margin calls for a lot today. and that's a wrap up for the day, folks! 
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| 24-Oct-2008 16:17 |
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yen just broke again. fyi only | ||
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| 24-Oct-2008 15:43 |
Seatrium
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Sembmarine
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hi kawaiiboi, just to correct a misconception about technical analysis: it's not true that TA fails. Where it 'fails', is because most pre-empt the signal and jump in, when in fact there may never have been any confirmatory signal at all. The aim of TA is not to get the exact lowest or the exact highest price (that's human greed): the aim of TA is to identify high probability set-ups, where your chances for gain are greater. And the common misconception about supports and resistances; just because a tech has given a certain price zone as support, it does NOT mean the price will automatically ping off it. after all, if every support is a buy, and every resistance is a sell, no one needs to hold a day job. Supports/Resistances are merely points to watch out for. price-volume action is what determines if it is a buy or not, at that support. And it is in the reading of price-vol action that most fail. Because most do not actually see the charts: they only see what they want to see. |
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| 24-Oct-2008 15:37 |
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hullo baseer, good reading and hunt for knowledge. :) the carry trade is a small part of what i teach my students. may as well put it out here for all. free small lesson. hehe. Carries are important to pay attention to, because when the carry unwinds, it leads to a fall in global equities and commodities. so watching the pairs give you a headstart ahead of everyone else, especially when critical supports are broken. You'll notice that at the time of my post, 1137 am, the STI was down, yes. But the real fall only took place in the afternoon. ie, between 1137am to 1230 pm, you could have cut loss on your counters (STI 1671-1653, cf to now, ~1608). Perhaps a simpler way of explaining the carry trade is as such: 1) The yen has the lowest interest rate amongst all the currencies. Only a flat 0.5% interest charge. 2) Hence, what big traders do--your investment banks and hedge funds--is to borrow massive amounts of money in the yen. The idea is to use that money to make profits elsewhere, since theoretically, you only need to make more than 0.5%, and you'll profit the rest. It's a form of massive leveraging, because they are playing with money they do not actually have. Which is why the gains are spectacular, and the falls even more so. 3) So that's the ideal. Now the currency that is borrowed is usually the USD. ie, the pair to watch is the UJ pair. A carry trade is essentially taking a long on the UJ. 4) What happens is reality. The yen strengthens suddenly (ie, USD dips). Because of traders playing, or weakness on the US side, whatever. What happens then? The interest rate is no longer 0.5%, because you also need to factor in the strengthening yen. 5) Think of it as a floating interest rate. To draw an analogy: Assume you borrowed 500k to buy a house. The bank tells you it's 5% interest. You can just about afford it, so you take the loan. Suddenly overnight, the bank tells you it's 8% interest, payable immediately. You can't afford it any more. What will you do then? Sell your house to pay back the loan. 6) And that, essentially, is what happens when the carry unwinds. Traders can no longer afford the loan, so they sell off what they had bought, in order to pay back the yen loan. The strengthening of the yen leads to other traders having to cover back their yen loans, which is what exacerbates selling on equities, commods, and every other class of investment/trading. This strengthening can happen very fast. eg, 5 hrs ago, the UJ was trading at abt 9619, now it's abt 9519. ie, a difference of 100 pips in just 5 hrs: ~1% difference in your borrowing rate in less than half a day. Sounds small, until you count that your loan is in millions. ----------------------- side note: Note that commods have been unwound globally since Lehman collapsed (kept posting abt it in sept, can't remember when exactly--that Lehman has massive long commods position, so since chapter 11, they have to be unwound); so ignore any analysts' buy calls on commods. They are likely the houses releasing their remainder commods globally onto ppl foolish enough to buy. Oil's spectacular collapse isn't by accident. Follow the walk, not the talk. |
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| 24-Oct-2008 15:08 |
SingTel
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Singtel Bullish???
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look overall lah; entire market dropping, one can't possibly expect singtel to keep going strong. anw, it was two foreigners quietly washing and selling singtel for the past few days. (or was it one local...not sure if the name is local or foreign). same thing as from last week: foreigners across board selling. fundamentals don't quite matter when the need is to raise money and the predominant mood is fear. tech gave the final signal to run yest/this morning, with the final bell throw down to 228.
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| 24-Oct-2008 10:51 |
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paying nothing is better than losing something. haha. they're all moving to treasuries lah. accepting even miniscule returns. in this kind of climate where everyone is raising cash, even good assets will be sold down. that's just the nature of irrationality. and gold bugs should take note: instead of just ape-ing whatever "experts" are saying about longterm value: the last run for gold was that steep $77 jump in one day. After that, it was down all the way. even now. same thing holds as i've been saying for the past mth or so: the USD has to strengthen. Hence, gold's only way is down. Ideally of course, markets bad => currencies weak => gold up. But REALISTICALLY, no one can afford the USD to drop. Not exporter countries who hold reserves in USD, not the US itself. A crippling of the USD would lead to a far weaker economy than the one in the works now. which is why every concerted attempt will be made to shore up the USD> That is why everything will go down except the USD and the yen, which is the opposite partner of the carry trades. follow the money flow, the real action, not whatever the analysts say. A lot of them are not thinking either; they're simply regurgitating the things they learnt in school. Theory and practice are very different. If oil breaks below 63 and gold below 650, the run for commods is over. |
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| 24-Oct-2008 09:30 |
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no need to watch today's market. cfm down. same pattern of holding some counters constant while diving others. foreigners washing counters throughout board. some local BBs may be buying. (-_-")....never go countertrend for longterm. divergence between STI and dow to be noted. STI has formed a lower low, lower high ever since the 1878 pinged to 1905 and failed to breach the previous 2218 mark. DJIA on the other hand has managed to ping off the 8000 mark and thus far held its bottom. ie, downtrend on renewed momentum for the STI. note that longterm uptrend support from 1997 (asian financial crisis) has been broken with the fall from this week. Your next support is pegged at around 1,550. Macros-wise, sentiment is so bad, at every resistance along the way, you'll meet stale bulls trying to get out. Not to mention global flow of money: not just to meet redemption calls back home, but that the money, by my estimate, is likely to go to the US. So for those who have been asking "is it time to buy", the answer is right in front of you. And one question: what's your hurry. The price-volume action is telling you everything you need to know already. |
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| 24-Oct-2008 09:12 |
Sembcorp Ind
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Is the current price irrational
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strict value criteria is actually half or a third NAV as buy. because of the closed nature of our market though, it's difficult to reach that. you'd expect to pay a certain premium for blue chips, that's why you call them blue chips, after all. Sembcorp's NAV is as idesa said. the thing to note is that, as of its last AR, sembcorp has free cash flow and no debts. Very rare for a large company. What this means is that, in a downturn, it is less likely to be affected by creditors, as it has its own cash to buy up distressed assets and/or expand if it wants to. So on FA, this is a major plus. Which may account for why it hasn't fallen as much as other blue chips. On technicals (which i much prefer to FA): Support at current zone of 170s-180s, next support goes to the 132-140s region. based on 5 yr history. |
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| 23-Oct-2008 17:15 |
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edit: have gotten some queries. just to clarify what my blog posts today meant: (you can see from the timing and the later action that it was live calls the entire trading day): normally movement is fast so i don't waste time doing long posts: -the first post on false rebound and no buying today: this was meant for longer term folks. http://elfinchilde.blogspot.com/2008/10/false-rebound.html -second post on update http://elfinchilde.blogspot.com/2008/10/update.html : was a tech note for intraday rapids: logic being as said in the post: that when a counter goes down too much, a tech rebound is in the works. -third post on intervention http://elfinchilde.blogspot.com/2008/10/intervention.html : as per the reading of macros in the previous post 1 hr before the event occurred: that there was intervention in the money markets. so overall, what this meant for rapids was: px already at a low, money markets intervention just before lunch: hence, likely a very rapid short bounce intraday, at most overnight. As said in 'update'--that the expectation was for the rebound to peter out by the end of day, at most tmrw. px-vol action showed the petering out for counters like kepcorp and st engg was today. final bell sell down for most of them. hence, as per the first post (even before the day's events occurred, pls rem): that the afternoon's event was a false rebound. longterm players shd stay out; traders, meanwhile, had option whether or not to take the rebound. don't mix up the two. cheers! |
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| 23-Oct-2008 16:27 |
CapitaLand
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CapitaLand: Too early to bottom fish
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good. you post the TA, save me the trouble. 
ok, off now.  time. interesting day cos of the money injections.
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| 23-Oct-2008 16:21 |
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http://www.elfinchilde.blogspot.com/ --nopes rusty, check updates. cos of intervention in money markets at abt 145 pm. for rapids, have to keep on toes. it's a live game. kepcorp and st engg took nice rebounds today. hehe. btw, folks, pls differentiate btwn rapids and longterm. don't get mixed up by my postings. sometimes i'm posting for longterm, o/r times, it's for rapids: may be intraday even. make sure you know what's what. and of course, caveat applies. wilmar is interesting. citi is one of the names selling. |
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| 23-Oct-2008 16:08 |
CapitaLand
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CapitaLand: Too early to bottom fish
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at the same price too! always happy to have expert concurrence. hehe.
check out its chart partner wilmar. methinks we may see a divergence between them in the final result. 
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| 23-Oct-2008 15:30 |
CapitaLand
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CapitaLand: Too early to bottom fish
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hehe, trader88, you're watching the same thing i'm observing. hehe. v interesting techs. :P | ||
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| 23-Oct-2008 15:03 |
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DOW
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cos intervention in money markets. | ||
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| 23-Oct-2008 12:59 |
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cathy, WT: currently resting on its Dec 03 support lower end. supports below: 55-59, 45-50, 41-43. major supports are today's px then the 43s range. no hurry to buy, really. no signal at all. |
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| 23-Oct-2008 11:57 |
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reposting here fr my blog:
false rebound in the market now. false supports and buying to induce lambs into market for the slaughter. foreigners selling across board. quietly now; the real diving will start in the afternoon.
NO buying today. Momentum is for renewed downtrend. Still peg 1,650 as an intraday low possibility for the coming days. Index touched 1,735 low this morning, close to the low i called a week ago. --------------
zillion, you come for lessons then you'll know. haha. damn it, i missed my tv show cos watching market. (-_-")....
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| 22-Oct-2008 18:57 |
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http://elfinchilde.blogspot.com/2008/10/alert.html zillion, i did warn folks on my blog last friday already that data was odd, and that they were quietly distributing already, while holding the STI constant....along with a direct warning to close all trades last fri. so personally, not surprised nor shocked to see the tanking these few days. CFD/SBL: i take it you mean shorting. gotta realise if you short now, you're shorting at a low. so the qn is how much further do you have to go. i play warrants, so i have no need for shorting personally. btw,the carry trades unwound this afternoon, so likely to have spillover effect. cheers! |
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