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How to screen
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ed88ks
Senior |
10-May-2007 04:36
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Richard Russell?s Dow Theory Letters, he is famous writer of dow's theory for 50 years still active. age 82 and very good at predicting the bear and bull market.....http://ww2.dowtheoryletters.com |
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singaporegal
Supreme |
09-May-2007 19:48
Yells: "Female TA nut" |
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Hi ed88ks, Who is Russell? |
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ed88ks
Senior |
09-May-2007 16:33
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Now read what Russell wrote last night on his website:
"We saw something that is extremely rare [on April 20 and April 25], in fact I can't remember ever having seen this before. What I'm referring to is that on those two dates all three Dow Jones Averages -- Industrials Transports
closed at simultaneous historic highs. To me, a fellow steeped in Dow Theory for over half a century, this was like a clap of thunder... My take on the situation is that the stock market (and the Dow Theory) told us that an unprecedented world boom lies ahead."
Russell acknowledges that what he has written will surprise many who are accustomed to his long-standing caution about the stock market. He imagines that we will want to respond by saying "But Russell, you're usually so conservative, so restrained. How can you possibly talk this way? Now you're talking about a worldwide boom. Are you smoking something we don't know about?"
Russell's response:
"I stopped smoking over 40 year ago. No, I'm simply relating to you my interpretation of what the market is saying. I believe the markets talk in their own secret language. And when the market does something that has never been done before, that serves as a 'kick in the pants' for me. It's telling me, 'Russell, wake up. Something very unusual is going on. Get up out of your chair -- and pay attention'
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ed88ks
Senior |
09-May-2007 16:24
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THIS IS THE GREATEST AND GOING TO BE THE LONGEST BULLRUN IN THE HISTORY OF MANKIND FOR SURE, IT'S A GLOBAL BULL LEAD BY CHINA....AND ASIA. AS DOW'S THEORY HAD SHOWN.. The property bull may keep on running until 2012 or even beyond, says Hong Leong Group executive chairman Kwek Leng Beng. Foreigners will keep pumping money into high-end housing. And businesses looking to get in on Singapore's fast-developing hub status will send office rents 'through the roof'. 'I believe that at least for the next few years, barring unforeseen circumstances, the boom is sustainable,' Mr Kwek told BT in a recent interview. 'If you believe in the seven-year property cycle, we will have a boom until 2012. Our economy, having been restructured, is strong and poised for growth even beyond that,' he said. 'I won't be surprised that we may be witnessing the biggest real estate boom in the history of Singapore.' |
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rayphua
Member |
09-May-2007 16:03
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An interesting movie you should catch, rather old, but related to this question you've raised up, is Boiler Room. Classic. |
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rayphua
Member |
09-May-2007 16:01
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Yet another interesting article, Ed. Btw noelneo, choice of screening methods is also rather dependant on the type of investor you are; daytrader, scalper, swing, short, mid, long term, etc. Each type of trading would requires similar and different type of tools. For example, if you're a mid to long term trader, FA is obviously important. However even if FA is critical, without ample investor interest in the counter, the value of the company would not appreciate as quickly. Your money used for this investment could also become an opportunity cost. Now say if you're a scalper, daytrader, swing trader, etc., the factor of average daily volume would then become one important factor, amongst other factors, coupled with the understanding of TA and psychological effects of "reading the tape". |
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ed88ks
Senior |
09-May-2007 15:42
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Investors shouldn?t go crazy OF late, most of the global markets, including Malaysia, were touching new highs. A lot of retailers, who sold most of their holdings after the recent stock market crashes, have started to plough their money back into the stock market. A lot of investors had missed out on the opportunity to make higher returns after the panic selling earlier as the stocks had continued to surge. Frustrated at the loss of opportunity, these investors have started to buy back their previous stocks at higher prices. They are starting to believe that the market crashes would not be serious and the market would not have any more major correction, given the strong performance in the global stock markets. Joseph E. Stiglitz (1990) in his research on Symposium on bubbles, defined ?bubble? as ?the reason that the price is high today is only because investors believe that the selling price will be high tomorrow. When ?fundamental? factors do not seem to justify such a price, then a bubble exists?. Recently, given that a major portion of stock prices cannot be supported by fundamentals, we believe that a speculative bubble has been created. A lot of stocks have been showing high returns and the public has started to become increasingly focused on the large profits and behaving irrationally. A speculative bubble is a Ponzi scheme, where investors generate positive feedback from existing returns on investments to give the impression that there will be large future profits on investments. It is a pyramid scheme whereby higher stock prices cause additional stock price increases. When more people invest, it will cause higher stock returns, and the market in turn reaches greater heights. One of the reasons causing higher stock prices is the upward revision of target prices by analysts on their recommended stocks. Given the limited choice of good quality stocks and growing demand on more stocks to invest, analysts are left with no choice but to set higher target prices. Even though there are still a lot of second-liner good fundamental stocks selling at cheap valuations, due to the ?sharing-the-blame effect?, most analysts will try to avoid new recommendations but make the same recommendation similar to other research reports. Besides, the media is also playing a role in causing this bubble. When the media starts to highlight the stock market's performance, these reports attract the attention of retailers. The highlighting of success stories of investors who reap good investment returns will lead other people to invest with the hope of achieving similar success. Hence, when investors witness continued price increases, they extrapolate this as an indication of further price hikes. Their confidence will be boosted when stock prices rise over an extended period of time. As a result, this overconfidence will cause stock market volume to surge and further attract other investors. When these investors start to make money and ?play? with their profits rather than their own invested capital, the speculation will get more severe and the bubble bigger. This phenomenon is called ?playing with the house?s money?, as investors become less risk-averse to ?playing? with profits rather than their capital. |
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harryp
Veteran |
09-May-2007 12:59
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Oh yes, Livermore's recommendation of reading news and Raypua's recommendation of learning FAs are most useful when the time comes to selection of the right targets from the list of screened targets. |
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harryp
Veteran |
09-May-2007 12:43
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The URLs of the two schools are: Teraseed - http://www.bull-fish.com/home/
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Livermore
Master |
09-May-2007 12:40
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I just read business times from Monday to Saturday. From the "clues" I get, I shall research on the companes online at www.sgx.com and www.shareinvestor.com. I used to buy The Edge but as I hardly read every article, I just go to Kinokuniya and browse through. I get a feel of what companies to look at. There was a good article on Fibrechem about 1 year ago and at that time the price was less than $1. Now it is more than $2. I usually cut out these ariticles and keep them. Then I attempt to see when I should start to buy. I don't use any TA. I just formulate my own strategy with some leverage. |
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harryp
Veteran |
09-May-2007 12:11
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Hi noelnoe, You don't need any big time BS rules for screening what type of counters you want to try your luck on. Just subscribe to some good charting companies such as AmiBroker or ChartNexus. There is sufficient programe in there to help you filter out the type of counters you want such as Bolingerband, MacD cross-overs, high volume breakouts, etc. Of course it is better to do a TA course first before attempting to read charts. The one I would highly recommend is Terassed. |
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iPunter
Supreme |
09-May-2007 11:46
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Rule #1: The only one/s one should really listen to should be the one who is/are making money. TA people are varied and diverse in interpretation and bias... some use many indicators, some use only a couple. And so many TA people also disagree among themselves. In fact some guru (eg. GAry Sm |
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Livermore
Master |
08-May-2007 21:41
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The more I read, I am able to asess if I can keep the stock for long term. Reading also helps you to assess where the general market direction might head to |
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Livermore
Master |
08-May-2007 21:39
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Hi Singaporegal, It is not true that all news is late news. If it were I would not keep reading the Business Times. There was a good articles on ASL Marine, Swissco FerroChina BEFORE their prices moved up.The same can be said of Fibrechem. Your TA technique does help too. |
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hybridvestor
Member |
08-May-2007 21:18
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singaporegal has given a very good piece of an advice .... :) . |
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rayphua
Member |
08-May-2007 20:41
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Try to get used to TA (Technical Analysis) to get a feel of the market sentiment, FA (Fundamental Analysis) to understand the financial numbers and current standings of the company, and avoid using RA (Rumor Analysis) as this is one sure way to lose money in the long term. Read a post, evaluate the companies TA and FA. Good luck. |
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singaporegal
Supreme |
08-May-2007 20:11
Yells: "Female TA nut" |
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Hi noelneo, I'm a TA person, which means to say I base my trades mainly on charts. I actually don't really bother too much with newspapers or magazines because by the time I read the article, the price would probably have changed because of the news. However, its good to know what's happening in the market place. The trick is to make your move BEFORE the news gets out. As for forums, please do not do a trade solely on what you read here. It is highly dangerous. Always do your own homework. Forums are good for getting the ground sentiment of a stock. If you stick around ShareJunction often, you will be able to tell which forummer is worth listening to after a while. |
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noelneo
Member |
08-May-2007 13:57
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Sorry, I'm a newbie to the world of investing... I'm wondering what are the information sources people use to find good stocks to invest in. Do you use magazines like Pulses, The Edge, etc; newspapers like The Straits Times and The Business Times; or forums like this one? I also heard that sometimes forums cannot be trusted because some people would use it to promote stocks they want to sell? Am I missing out anything here, or do you have any recommendations? Thank you. |
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