Chart-On-Demand

Happy & Prosperous Lunar New Year 2008!

2008-02-06T12:19:00.000+08:00

Dow Jones in Focus

2008-01-17T22:15:00.000+08:00

An update on our beloved Dow Jones, from chart, it appears to sit tightly at a turning point at the 12,400 mark especially when it close flat for the day yesterday 16th jan. Infering from the trend channels, it would appear that a rebound seems higher chance than another substantial selldown. However when it does happen(selldown) from here, 12,400 mark, it would be extremely bearish. Take note that overall, the Dow Jones industrial index is still stuck within a 6-month downtrend as seen by the downtrend channel til it disrupts the upper trend channel.

A 50% retracement up from 12,400 from the high of 13,780 gives us 13,094 , should the dow jones retraces back up to this level or even better the 61.8% level of 13,257, it would stand a really good chance to breakup from the downtrend. Take note though should it breaks down the upwards sloping channel line within the major downtrend channel.

On a side note, i wonder how long the local brokerages or the FTSE-SGX collaboration management going to give in to provding free singapore index feed on the internet platform. Interesting to note for once the local brokerages stands up united against SGX.

Merry Christmas & Happy Holidays!

2007-12-24T09:50:00.000+08:00

Wishing u joyous holidays and a wonderful new year 2008.

dave

2007-12-11T09:12:00.000+08:00

A wedding shoot at the Pan Pacific.

From Mexico, with Love.

2007-12-01T21:27:00.000+08:00

the famous ARCH in the Baja Peninsula, separates the Sea of Cortex from the Pacific Ocean.

Sunrise taken from our time share apt in mexico, cabo san lucas.

The sea lion colony amongst the rocks

Sunset taken from the cruise ship.

(Pictures courtesy of ateo.)

Trading to Win: THE PSYCHOLOGY OF MASTERING THE MARKETS

2007-11-11T11:13:00.000+08:00

"Trading to win" defines a goal-oriented approach designed to help
JL traders maximize their performance in a unique way¡ªby tapping
personal resources they might never know they had, by developing a ra-
tional strategy for trading, by learning new psychological skills, and by
letting go of unproductive, even maladaptive, behavior patterns.
This approach puts a special emphasis on learning to get rid of past
memories and erroneous notions around which people have organized
their lives. This book shows you how to commit to a future goal by sur-
rendering to it, and simultaneously relinquishing all thoughts of gain,
achievement, or attachment. Sounds paradoxical, you say? It is. That's
the point.

This system encourages you to trust a higher power that assists you
in realizing the power within yourself. Periodically it helps you refocus
on your goal, realigning yourself with your objectives. Then, you use
your objectives as a filter through which to make distinctions in the
present moment.

The world of trading is one of high stakes and high-risk activity.
The goal is, ostensibly, financial gain. Give up that goal, and you gain
the freedom to genuinely listen to the sounds of the marketplace and to
be able to read the movement of stock prices in a way that enables you
to increase your probability of success.

For master traders, the monetary result is secondary to the gratifica-
tion that comes from being able to make the right market call. They get
their primary satisfaction from having an idea about a stock and imple-
menting this idea in a profitable trade. Master traders trust their infor-
mation, sense the direction of the marketplace, and assess many other
variables before finally executing a lucrative trade.

This requires an enormous ability to abandon pride and to maintain
equanimity in the face of loss or excessive profit. The master trader
knows¡ªand you can learn¡ªthat neither despair nor euphoria should
cloud one's judgment. As you improve, the market becomes even more
challenging, requiring you to commit to bigger numbers or more com-
plex dimensions of the game. If you are willing, this can lead you to
give up more of your old habits and to become more at one with the
universe.

I have watched this occur in real-life traders. For the past six years I
have met weekly with a group of professional traders to explore the psy-
chological and emotional dimensions of their trading and to find ways
of maximizing their performance. The Trading to Win principles dis-
cussed in this book evolved from these seminars and have since been
tested and developed in several other trading settings. I am deeply in-
debted to Steve Cohen for making this opportunity possible and for
paving the way to a greater appreciation of these broader issues to the
traders in his and other firms.

(Because of the proprietary nature of many of the issues considered
in this book, I have not identified any specific traders by name. All per-
sonality profiles represent composites of the various traders and, al-
though there are female traders, the masculine persona has been used
throughout for realism in this currently male-dominated field.)

Reading the market's direction and the directions of specific
stocks is essential to trading success. It is like the childhood game of
musical chairs. In that game, you have to time your move so that you
do not jump for a chair before the music has stopped; you also don't
want to linger too long after the music stops so that there are no
seats left. This is the trader's dilemma as well. The more skilled you
are, the more patience you have, the longer you can stay in as the
stock rises or falls before you act. You stay in longer, and therefore
maximize your profits. However, you do not stay in so long that, by
holding declining stock in hope that it will turn around.

The same goes for being able to minimize your losses. Rather than
hoping and praying and rationalizing your hesitation by convincing
yourself that the stock will eventually turn around, you cut your
losses instead.

The Trading to Win program spotlights a set of philosophical and
behavioral principles that can help you to implement proactive trad-
ing strategies. This approach involves commitment, concentration,
recovery, and preparation for the next day. It enables you to trust
your true self.

This approach is not for the fainthearted. It puts much emphasis on
proactive trading strategies designed to produce exponential results. It
encourages you to do counterintuitive things¡ªsuch as admitting uncer-
tainty, fear, and lack of knowledge and asking for help; sharing informa-
tion; and facing vulnerability. All of this means letting go of ego and
arrogance, which blurs your focus on the marketplace. It compels you
to learn to communicate directly and clearly with others, whether they
be staff, associates, or floor brokers.

Trading to win obliges you to review each day's trades, so you can
see how you may have veered from your commitment, what dropped
out of your trading, and what commitment you must add to get the de-
sired result. You might need to raise the number of shares traded so they
are consistent with your level of commitment. You might have to aban-
don energy-draining behavior¡ªimpulsiveness, chest beating, whining,
and scalping (selling too soon to book a quick profit and missing the
larger upward movement of a stock). You'll need to understand how to
get out fast when stocks are dropping. You'll have to shed counterpro-
ductive habits, such as taking personal calls during trading times or rac-
ing home after the bell instead of reviewing the day with other traders
and coaches.

In addition, you must learn the appropriate role of money. In
trading, it's not so much to be rich or secure. It is a way of keeping
score. It is a way of defining the framework of events so that you can
determine what actions are needed in the present. Paradoxically, the
greater the amount of money, the more you must renounce your fo-
cus on it.

While this program has been developed for professional traders, its
principles have value for the ordinary trader as well. Sound trading ap-
plies to everyone, including the advanced trader who must regularly re-
turn to basics. Since it concentrates on a goal, yet makes you detach
your ego from it, it has relevance not only to investing, but to life as
well. I define "winning" as maximizing your own potential, as seeing
the world realistically, and as living life like the miracle it is. After all,
trading is a metaphor for the perilous yet exhilarating nature of living
on the edge.

What's the Concept, Doc?

The objective of this book is to try to get at the underlying thought
process behind trades. What are you are really thinking? What's moti-
vating you? Is it consistent With your style? Does it make sense for you?
Or are you governed at a given moment by emotion, by panic, or by
whatever is going on in the Street? The ultimate objective is to be much
more capable of reading the tape and reading the changes in the market
in terms of what is occurring based on what you understand about it.
You'll hear colleagues discuss in these pages things that they don't nor-
mally like to talk about, such as weakness or getting away from one's
game plan.

'Trading, like sports, involves a high degree of uncertainty and un-
predictabilityj This means playing in unfamiliar territory. Many books
explore basic trading and basic psychological concepts such as relax-
ation, but don't link psychology and trading behavior. My aim is to de-
velop the thought processes essential for trading in the realm of
uncertainty. Whether you are hammered by fear or animated by eupho-
ria, both can throw you off your game.

It is important to understand why you may lose after you win big,
or why you may sometimes feel that you don't deserve to win, or feel
guilty about it, or have an attitude about money that colors your trad-
ing. To be a super-trader, you must learn not to forget your discipline
and not to forget to respect the market. How do you surrender and
yet keep your consciousness and your alertness so you can move in
and out?

Trading is a very high-pressure game. It triggers a lot of defensive-
ness that on the surface looks very rational and reasonable. I hope that
this book raises your level of awareness of certain critical processes so
that you can begin to use them in your work.

What Do I Mean by a Strategy?
Once you set a specific goal for the year, you must ask how you are go-
ing to meet it. How many trades at what size would you have to make
in order to make your number? What should your team look like? What
general rules must you establish in terms of holding on, doubling up, or
getting out of positions?
If you reply with a shrug, "Well, I want to do as well as I can," you
are less likely to get there. To reach your target, you'll have to elevate
your game to a level where you say, "Okay, this is what I'm going
to do."
Why have rules? Because some moves, which you can find in your
own database, consistently work. Forget the standard litany of rational-
izations. You can always blame Alan Greenspan, or the market, or the
fact that it's February. But regardless of different styles, certain princi-
ples remain immutable. If a stock goes down and you own it, you're
losing money. "I'm going to make it a long-term trade," you say? You
still lost money today. "It's a six-month trade" or "a three-month
trade"? Maybe. But today you were hoping and wishing; you read
something in Barron's, but it doesn't happen. You may keep thinking
that you can make up for the loss, but, in fact, you would make much
more if your losses were less.

Once you stop having too great a tolerance for a high level of loss,
you can start raising your monthly profit and loss (P&L) significantly.
Some traders, even substantial ones, stay in positions even if they're
dropping, because they are "macho" and can "tolerate pain." The stock
will eventually come back, they tell themselves. But you are not a wimp
if you get out of a losing position.

One trader I know had to learn to get out at three points. Next he
learned to get out at one and a half, and he made more money. Now he
has to take the next big step: learning that it's okay to run away from a
losing stock. So if he's making four thousand dollars and he starts cut-
ting his losses, he can make five or six thousand.

Heaven on Earth.

2007-09-21T21:07:00.000+08:00

(Pictures courtesy of Ateo, taken at the North East Cascades and the Pearrygian.)

I = Institutional Sponsorship: A Little Goes a Long Way

2007-08-21T20:40:00.000+08:00

It takes big demand to move supply up, and the largest source of
demand for stocks is by far the institutional buyer. A stock certainly
does not need a large number of institutional owners, but it should have
at least a few such sponsors. Three to ten might be a minimum or rea-
sonable number of mutual fund sponsors, although some stocks might
have a good deal more.

The would-be winning investor should learn to sort through and rec-
ognize that certain institutional sponsors are more savvy, have a
stronger performance record, and are better at choosing stocks than
others are. I call it analyzing the quality of sponsorship.

What Is Institutional
Sponsorship?

Sponsorship may take the form of mutual funds; corporate pension
funds; insurance companies; large investment counselors; hedge funds;
bank trust departments; or state, charitable, and educational institutions.
For measurement purposes, I do not consider brokerage firm
research department reports as institutional sponsorship, although a
few exert influence on certain securities. Investment advisory services
and market letter writers are also not considered to be institutional or
professional sponsorship in this definition.

Financial services such as Vickers and Arthur Weisenberger & Co. pub-
lish fund holdings and investment performance records of various insti-
tutions. In the past, mutual funds have tended to be slightly more
aggressive in the market, but banks have managed larger amounts of
money. More recently, numerous new "entrepreneurial type" investment
counseling firms have been organized to manage institutional monies.
Performance figures for the latest 12 months plus the last three- to
five-year period are usually the most relevant. However, results may
change significantly as key portfolio managers leave one money man-
agement organization and go to another. The institutional leaders con-
tinually rotate and change.

For example, Security Pacific Bank (now merged into Bank America)
had somewhat modest performance in its trust investment division up
to 1981. But with the addition of new management and more realistic
concepts in the investment area, it polished up its act to the point that
it ranked at the very top in performance in 1982. In 1984, the top man-
ager of Security Pacific left and formed his own company, Nicolas
Applegate of San Diego.

If a stock has no professional sponsorship, chances are that its perfor-
mance will be more run-of-the-mill. The odds are that at least several of
the more than 1000 institutional investors have looked at the stock and
passed it over. Even if they are wrong, it still takes large buying to stimu-
late an important price increase in a security.

Also, sponsorship provides buying support when you want to get out of
your investment. If there is no sponsorship and you try to sell your stock
in a poor market, you may have problems finding someone to buy it.
Daily marketability is one of the great advantages of owning stock.
(Real estate is far less liquid and commissions and fees are much high-
er.) Institutional sponsorship helps provide continuous marketability
and liquidity.

Is It "Overowned" by
Institutions?

A stock can also have too much sponsorship and become "overowned."
Overowned is a term we coined and began using in 1969 to describe a
stock whose institutional ownership had become excessive. In any case,
excessive sponsorship can be adverse since it merely represents large
potential selling if anything goes wrong in the company or the general
market. On the other hand, Snapple, in April 1993, was underowned.
The "favorite 50" and other lists of the most widely owned institu-
tional stocks can be rather poor, and potentially risky, prospect lists. By
the time performance is so obvious that almost all institutions own a
stock, it is probably too late. The heart is already out of the watermelon.

An Unassailable Institutional
Growth Stock Tops

In June 1974, we put Xerox on our institutional sell list at $115. We
received unbelievable flack because Xerox was then one of the most
widely held institutional stocks and had been amazingly successful up to
that point. However, our research indicated it had topped and was
headed down in price.

Institutions made Xerox their most widely purchased stock for that
year. Of course that didn't stop it from tumbling in price. What it did
prove was how sick the stock really was at that time, since it declined
steadily in spite of such buying. The episode did bring us our first large
insurance company account in New York City in 1974.

They had been buying Xerox on the way down in the $80s until we
persuaded them they should be selling instead of buying.

Famous Last Words "We'll
Never Sell Avon Products"

We tried that same year to get another well-known eastern insurance
company to sell Avon Products at $105, and I recall the head of their
investment organization pounding the table and saying, "We'll never
sell Avon Products; it's such an outstanding company." I wonder if they
still have it?

Professionals, like the public, love to buy on declines. They also make
mistakes and incur losses. In many ways, some institutions are like the
public. Money management organizations have their experienced and
realistic decision makers, as well as their less seasoned or unrealistic
portfolio managers and analysts.

It is, therefore, not always as crucial to know how many institutions
own a stock as it is to know which of the better ones own or have pur-
chased a particular stock in the last quarter. The only important thing
about the number of institutional owners is to note the recent quarterly
trend. Is the number of sponsors increasing or decreasing?

Note New Stock Positions
Bought in the Last Quarter

New institutional positions acquired in the last quarter are more rele-
vent. Many investors find that disclosures of a fund's new commitments are
published after the fact, too late to be of any real value. This is riot true.
These reports are available publicly about six weeks after the end of a
fund's quarter. The records are very helpful to those who can single out
the wiser selections and understand correct timing and the proper use
of charts.

Additionally, half of all institutional buying that shows up on the New
York Stock Exchange ticker tape may be in humdrum stocks and much
of the buying may be wrong. However, out of the other half you may
have some truly phenomenal selections.

Your task, then, is to weed through and separate the intelligent, high-
ly informed institutional buying from the poor, faulty buying. Though
difficult, this will become easier as you learn to apply and follow the
rules, guidelines, and principles presented in this book.

Institutional trades usually show up oil the stock exchange ticker tape
in most brokers' offices in transactions of 1000 shares up to 100,000
shares or more. Institutional buying and selling accounts for more than
70% of the activity in most leading companies. I estimate that close to
80% or 90% of the important price movements of stocks on the New
York Stock Exchange are caused by institutional orders.

As background information, it may be valuable to find out the invest-
ment philosophy and techniques used by certain funds. For example,
Pioneer Fund in Boston has always emphasized buying supposedly
undervalued stocks selling at low P/E ratios, and its portfolio contains a
larger number of OTC stocks. A chartist probably would not buy many
of Pioneer's stocks. On the other hand, Keystone S-4 usually remains
fully invested in the most aggressive growth stocks it can find. Evergreen
Fund, run by Steve Lieber, does a fine job of uncovering fundamentally
sound, small companies.

Jim Stower's Twentieth Century Ultra and his Growth Investors funds
use computer screening to buy volatile, aggressive stocks that show the
greatest percentage increase in recent sales and earnings.
Magellan and Contra Fund in Boston scours the country to get in
early on every new concept or story in a stock. Some other manage-
ments worth tracking might be AIM Management, Nicolas Applegate,
Thomson, Brandywine, Berger, and CGM. Some funds buy on new
highs, others try to buy around lows and may sell on new highs.

In a capsule, buy stocks that have at least a few institutional sponsors
with better-than-average recent performance records.

(Excerpt from 'How To Make Money in Stocks')

Crossroads

2007-08-06T21:23:00.000+08:00

Have a Wonderful Weekend.

2007-07-21T11:11:00.000+08:00

Enjoy.

L= Leader or Laggard: Which is Your Stock?

2007-07-09T21:21:00.000+08:00

Most of the time, people buy stocks they like, stocks they feel good
about, or stocks they feel comfortable with, like an old friend, old
shoes, or an old dog. These securities are frequently sentimental, drag-
gy slowpokes rather than leaping leaders in the overall exciting stock
market.

Let's suppose you want to buy a stock in the computer industry. If you
buy the leading security in the group and your timing is sound, you
have a crack at real price appreciation.

If, on the other hand, you buy equities that haven't yet moved or are
down the most in price, because you feel safer with them and think
you're getting a real bargain, you're probably buying the sleepy losers
of the group. Don't dabble in stocks. Dig in and do some detective
work.

Buy among the Best Two or
Three Stocks in a Group

The top two or three stocks actionwise in a strong industry group can
have unbelievable growth, while others in the pack may hardly stir a
point or two. Has this ever happened to you?

In 1979 and 1980, Wang Labs, Prime Computer, Datapoint, Rolm
Corp., Tandem Computer, and other small computer companies had
five-, six-, and seven-fold advances before topping and retreating, while
grand old IBM just sat there and giants Burroughs, NCR, and Sperry
Rand turned in lifeless price performances. In the next bull market
cycle, IBM finally sprang to life and produced excellent results. Home
Depot advanced 10 times from 1988 to 1992, while Waban and
Hechinger, the laggards, clearly underperformed.

Avoid Sympathy Stock Moves

There is very little that's really new in the stock market. History just
keeps repeating itself. In the summer of 1963, I bought Syntex, which
afterwards advanced 400%. Yet most people would not buy it then
because it had just made a new high in price at $100 and its P/E ratio,
at 45, seemed too high.

Several investment firms recommended G. D. Searle, a sympathy play,
which at the same time looked much cheaper in price and had a similar
product to Syntex's. But Searle failed to produce stock market results.
Syntex was the leader, Searle the laggard.

Sympathy plays are stocks in the same group as a leading stock, but
ones showing a more mediocre record and weaker price performance.
They eventually attempt to move up and follow "in sympathy" the pow-
erful price movement of the real group leader.

In 1970, Levitz Furniture became an electrifying stock market winner.
Wickes Corp. copied Levitz and plunged into the warehouse furniture
business.

Many people bought Wickes instead of Levitz because it was cheaper
in price. Wickes never performed. It ultimately got into financial trou-
ble, whereas Levitz increased 900% before it finally topped. As Andrew
Carnegie, the steel industry pioneer, said in his autobiography, "The
first man gets the oyster; the second, the shell."

Is the Stock's Relative Price
Strength Below 70?

Here is a simple, easy-to-remember measure that will help tell you if a
security is a leader or a laggard. If the stock's relative price strength, on
a scale from 1 to 99, is below 70, it's lagging the better-performing
stocks in the overall market. That doesn't mean it can't go up in price,
it just means if it goes up, it will probably rise a more inconsequential
amount.

Relative strength normally compares a stock's price perfor-
mance to the price action of a general market average like the Standard
& Poor's (S&P) Index, or in some cases, all other stocks. A relative
strength of 70, for example, means a stock outperformed 70% of the
stocks in the comparison group during a given period, say, the last six
or twelve months.

The 500 best-performing listed equities for each year from 1953
through 1993 averaged a relative price strength rating of 87 just before
their major increase in price actually began. So the determined winner's
rule is: Avoid laggard stocks and avoid sympathy movements. Look for
the genuine leaders!

Most of the better investment services show both a relative strength
line and a relative strength number and update these every week for a
list of thousands of stocks.

Relative strength numbers are shown each day for all stocks listed in
the Investor's Business Daily NYSE, AMEX, and NASDAQ price tables.
Updated relative strength numbers are also shown in Daily Graphs
charting service each week.

Pick 80s and 90s That Arc in
a Chart Base Pattern

If you want to upgrade your stock selection and concentrate on the best
leaders, you could consider restricting your buys to companies showing
a relative strength rank of 80 or higher. Establish some definite disci-
pline and rules for yourself.

If you do this, make sure the stock is in a sound base-building zone
(proper sideways price consolidation pattern) and that the stock is not
extended (up) more than 5% or 10% above this base pattern. This will
prevent you from chasing stocks that have raced up in price too rapidly
above their chart base patterns. For example, in the Reebok chart
shown at the end of Chapter 3, if the exact buy point was $29, the stock
should not be purchased more than 5% or 10% above $29.

If a relative price strength line has been sinking for seven months or
more, or if the line has an abnormally sharp decline for four months or
more, the stock's behavior is questionable.

Why buy an equity whose relative performance is inferior and strag-
gling drearily behind a laige number of other, better-acting securities
in the market? Yet most investors do, and many do it without ever look-
ing at a relative strength line or number.

Some large institutional portfolios are riddled with stocks showing
prolonged downtrends in relative strength. I do not like to buy stocks
with a relative strength rating below 80, or with a relative strength line
in an overall downtrend.

In fact, the really big money-making selections generally have a rela-
live strength reading of 90 or higher just before breaking out of their
first or second base structure. A potential winning stock's relative
strength should be the same as a major league pitcher's fast ball. The
average big league fast ball is clocked about 86 miles per hour and the
outstanding pitchers throw "heat" in the 90s.

The complete lack of investor awareness, or at least unwillingness, in
establishing and following minimum realistic standards for good stock
selection reminds me that doctors many years ago were ignorant of the
need to sterilize their instruments before each operation. So they kept
killing off excessive numbers of their patients until surgeons finally and
begrudgingly accepted studies by a young French chemist named Louis
Pasteur on the need for sterilization.

It isn't very rewarding to make questionable decisions in any arena.
And in evaluating the American economy, investors should zero in on
sound new market leaders and avoid anemic-performance investments.

Always Sell Your Worst
Stock First

If you own a portfolio of equities, you must learn to sell your worst-per-
forming stocks first and keep your best-acting investments a little
longer. In other words, sell your cats and dogs, your losers and mistakes,
and try to turn your better selections into your big winners.

General market corrections, or price declines, can help you recognize
new leaders if you know what to look for. The more desirable growth
stocks normally correct l'/2 to 2/2 times the general market averages.
However as a rule, growth stocks declining the least (percentagewise) in
a bull market correction are your strongest and best investments, and
stocks that plummet the most are your weakest choices.

For example, if the overall market suffers a 10% intermediate term
falloff, three successful growth securities could drop 15%, 20%, and
30%. The ones down only 15% or 20% are likely to be your best invest-
ments after they recover. Of course, a stock sliding 35% to 40% in a
general market decline of 10% could be flashing you a warning signal,
and you should, in many cases, steer clear of such an uncertain actor.

Pros Make Mistakes Too

Many professional investment managers make the serious mistake of
buying stocks that have just suffered unusually large price drops. In
June 1972, a normally capable, leading institutional investor in
Maryland bought Levitz Furniture after its first abnormal price break in
one week from $60 to around $40. The stock rallied for a few weeks,
rolled over, and broke to $18.

Several institutional investors bought Memorex in October 1978,
when it had its first unusual price break. It later plunged.
Certain money managers in New York bought Dome Petroleum in
September 1981 after its sharp drop from $16 to $12, because it seemed
cheap arid there was a favorable story going around Wall Street on the
stock. Months later Dome sold for $1, and the street talk was that the
company might be in financial difficulties.

None of these professionals had recognized the difference between
the normal price declines and the highly abnormal corrections that
were a sign of potential disaster in this stock.

Of course, the real problem was that these expert investors all relied
solely on fundamental analysis (and stories) and their personal opinion
of value (lower P/E ratios), with a complete disregard for what market
action could have told them was really going on. Those who ignore what
the marketplace is saying usually suffer some heavy losses.

Once a general market decline is definitely over, the first stocks that
bounce back to new price highs are almost always your authentic leaders.
This process continues to occur week by week for about three months
or so, with many stocks recovering and making new highs. To be a truly
astute professional or individual investor you must learn to recognize
the difference between normal price action and abnormal activity.
When you understand how to do this well, people will say you have "a
good feel for the market."

Control Data-Abnormal
Strength in a Weak Market

During a trip to New York in April 1967, I remember walking through a
broker's office on one day when the Dow Jones Industrial Average was
down over twelve points. When I looked up at the electronic ticker tape
showing prices moving across the wall, Control Data was trading in
heavy volume at $62, up SV-j points for the day. I immediately bought
the stock at the market, because I knew Control Data well, and this was
abnormal strength in the face of a weak overall market. The stock sub-
sequently reached $150.

In April 1981, just as the 1981 bear market was commencing, MCI
Communications, a Washington, D.C.-based telecommunications stock
trading in the over-the-counter market, broke out of a price base at $15.
It advanced to the equivalent of $90 in the following 21 months.
MCI tripled in a declining market. This was a great example of abnor-
mal strength during a weak market. Lorillard did the same thing in the
1957 bear market. Software Toolworks soared in January 1990.

So don't forget: It seldom pays to invest in laggard performing stocks
even if they look tantalizingly cheap. Look for the market leader.

(Excerpt from How To Make Money in Stocks.)

What Is .

2007-06-21T21:18:00.000+08:00

Highly recommended film to catch. A film that truly gives different meaning to different people. We are given a deep sense of self-awareness for such contemplation of the 'higher truth' . The key is in the discovery, not in the believing.

S = Supply and Demand; Small Capitalization Plus Big Volume Demand

2007-06-11T20:35:00.000+08:00

The law of supply and demand determines the price of almost every-
thing in your daily life. When you go to the grocery store and buy fresh
lettuce, tomatoes, eggs, or beef, supply and demand affects the price.

The law of supply and demand even impacted the price of food and
consumer goods in former Communist, dictator-controlled countries
where these state-owned items were always in short supply and frequently
available only to the privileged class of higher officials in the bureaucracy
or in the black market to comrades who could pay exorbitant prices.

The stock market does not escape this basic price principle. The law
of supply and demand is more important than all the analyst opinions
on Wall Street.

Big Is Not Always Better

The price of a common stock with 300 million shares outstanding is
hard to budge up because of the large supply of stock available. A
tremendous volume of buying (demand) is needed to create a rousing
price increase.

On the other hand, if a company has only 2 or 3 million shares of
common stock outstanding, a reasonable amount of buying can push
the stock up rapidly because of the small available supply.
If you are choosing between two stocks to buy, one with 10 million
shares outstanding and the other with 60 million, the smaller one will
usually be the rip-roaring performer if other factors are equal.

The total number of shares of common stock outstanding in a com-
pany's capital structure represents the potential amount of stock avail-
able for purchase.

The stock's "floating supply" is also frequently considered by market
professionals. It measures the number of common shares left for possi-
ble purchase after subtracting the quantity of stock that is closely held
by company management. Stocks that have a large percentage of owner-
ship by top management are generally your best prospects.

There is another fundamental reason, besides supply and demand,
that companies with large capitalizations (number of shares outstand-
ing) as a rule produce dreadful price appreciation results in the stock
market. The companies themselves are simply too big and sluggish.

Pick Entrepreneurial
Managements Rather Than
Caretakers

Giant size may create seeming power and influence, but size in corpora-
tions can also produce lack of imagination from older, more conserva-
tive "caretaker managements" less willing to innovate, take risks, and
keep up with the times.

In most cases, top management of large companies does not own a
meaningful portion of the company's common stock. This is a serious
defect large companies should attempt to correct.

Also, too many layers of management separate the senior executive
from what's really going on out in the field at the customer level. And
in the real world, the ultimate boss in a company is the customer.
Times are changing at a quickening pace. A corporation with a fast-
selling, hot new product today will find sales slipping within three years
if it doesn't continue to have important new products coming to market.

Most of today's inventions and exciting new products and services are
created by hungry, innovative, small- and medium-sized young compa-
nies with entrepreneurial-type management. As a result, these organiza-
tions grow much faster and create most of the new jobs for all
Americans. This is where the great future growth of America lies. Many
of these companies will be in the services or technology industries.

If a mammoth-sized company occasionally creates an important new
product, it still may not materially help the company's stock because
the new product will probably only account for a small percentage of
the gigantic company's sales and earnings. The product is simply a little
drop in a bucket that's just too big.

Institutional Investors Have a
Big Cap Handicap

Many large institutional investors create a serious disadvantage for
themselves because they incorrectly believe that due to their size they
can only buy large capitalization companies. This automatically elimi-
nates from consideration most of the true growth companies. It also
practically guarantees inadequate performance because these investors
may restrict their selections mainly to slowly decaying, inefficient, fully
matured companies. As an individual investor, you don't have this limi-
tation.

If I were a large institutional investor, I would rather own 200 of the
most outstanding, small- to medium-sized growth companies than 50 to
100 old, overgrown, large-capitalization stocks that appear on every-
one's "favorite fifty" list.

If you desire clear-cut factual evidence, the 40 year study of the great-
est stock market winners indicated more than 95% of the companies
had fewer than 25 million shares in their capitalization when they had
their greatest period of earnings improvement and stock market perfor-
mance. The average capitalization of top-performing listed stocks from
1970 through 1982 was 11.8 million shares. The median stock exhibited
4.6 million shares outstanding before advancing rapidly in price.

Foolish Stock Splits Can Hurt

Corporate management at times makes the mistake of excessively split-
ting its company's stock. This is sometimes done based upon question-
able advice from the company's Wall Street investment bankers.
In rny opinion, it is usually better for a company to split its shares 2-'
for-1 or 3-for-2, rather than 3-for-l or 5-for-l. (When a stock splits 2-for-
1, you get two shares for each one previously held, but the new shares
sell for half the price.)

Overabundant stock splits create a substantially larger supply and may
put a company in the more lethargic performance, or "big cap," status
sooner.

It is particularly foolish for a company whose stock has gone up in
price for a year or two to have an extravagant stock split near the end of
a bull market or in the early stage of a bear market. Yet this is exactly
what most corporations do.

They think the stock will attract more buyers if it sells for a cheaper
price per share. This may occur, but may have the opposite result the
company wants, particularly if it's the second split in the last couple of
years. Knowledgeable professionals and a few shrewd traders will proba-
bly use the oversized split as an opportunity to sell into the obvious
"good news" and excitement, and take their profits.

Many times a stock's price will top around the second or third time it
splits. However, in the year preceding great price advances of the lead-
ing stocks, in performance, only 18% had splits.

Large holders who are thinking of selling might feel it easier to sell
some of their 100,000 shares before the split takes effect than to have to
sell 300,000 shares after a 3-for-l split. And smart short sellers (a rather
infinitesimal group) pick on stocks that are beginning to falter after
enormous price runups¡Xthree-, five-, and ten-fold increases¡Xand
which are heavily owned by funds. The funds could, after an unreason-
able stock split, find the number of their shares tripled, thereby dramat-
ically increasing the potential number of shares for sale.

Look for Companies Buying
Their Own Stock in the
Open Market

One fairly positive sign, particularly in small- to medium-sized compa-
nies, is for the concern to be acquiring its own stock in the open market-
place over a consistent period of time. This reduces the number of shares
of common stock in the capital structure and implies the corporation
expects improved sales and earnings in the future.

Total company earnings will, as a result, usually be divided among a
smaller number of shares, which will automatically increase the earn-
ings per share. And as we've discussed, the percentage increase in earn-
ings per share is one of the principal driving forces behind outstanding
stocks.

Tandy Corp., Teledyne, and Metromedia are three organizations that
successfully repurchased their own stock during the era from the mid-
1970s to the early 1980s. All three companies produced notable results
in their earnings-per-share growth and in the price advance of their
stock.

Tandy (split-adjusted) stock increased from $2 4 to $60 between 1973
and 1983. Teledyne stock zoomed from $8 to $190 in the thirteen years
prior to June 1984, and Metromedia's stock price soared to $560 from
$30 in the six years beginning in 1977. Teledyne shrunk its capitaliza-
tion from 88 million shares in 1971 to 15 million shares and increased
its earnings from $0.61 a share to nearly $20 per share with eight differ-
ent huvbacks.

Low Corporate Debt to Equity
Is Usually Better

Alter you have picked a stock with a small or reasonable number of
shares in its capitalization, it pays to check the percentage of the
firm's total capitalization represented by long-term debt or bonds.
Usually the lower the debt ratio, the safer and better the company.
Earnings per share of companies with high debt-to-equity ratios can
be clobbered in difficult periods of high interest rates. These highly
leveraged companies generally are deemed to be of poorer quality and
higher risk.

A corporation that has been reducing its debt as a percent of equity
over the last two or three years is well worth considering. If nothing
else, the company's interest expense will be materially reduced and
should result in increased earnings per share.
The presence of convertible bonds in a concern's capital structure
could dilute corporate earnings if and when the bonds are converted
into shares of common stock.

It should be understood that smaller capitalization stocks are less liq-
uid, are substantially more volatile, and will tend to go up and down
faster; therefore, they involve additional risk as well as greater opportu-
nity. There are, however, definite ways of minimizing your risks, which
will be discussed in Chapter 9.

Lower-priced stocks with thin (small) capitalization and no institu-
tional sponsorship or ownership should be avoided, since they have
poor liquidity and a lower-grade following.

A stock's daily trading volume is our best measure of its supply and
demand. Trading volume should dry up on corrections and increase
significantly on rallies. As a stock's price breaks out of a sound and
proper base structure, its volume should increase at least 50% above
normal. In many cases, it can increase 100% or more.

In summary, remember: stocks with a small or reasonable number of
shares outstanding will, other things being equal, usually outperform
older, large capitalization companies.

(Excerpt from 'How To Make Money in Stocks')

Sino Techfibre

2007-06-04T21:04:00.000+08:00

As requested. Sino Techfibre has establish a base support at the 61.8% retracement from the high of 1.64 to the low of 1.10. From todays price actions, resistance levels to break through are at 1.40/1.44/1.52 while support levels are at 1.37/1.30 . Volume count of 10mil and above on an upwards move would be bullish and high chance of breaking through resistance levels.

N = New Products, New Management, New Highs; Buying at the Right Time

2007-05-22T21:11:00.000+08:00

N = New Products,
New Management,
New Highs:
Buying at the Right Time

It takes something new to produce a startling advance in the price of
a stock.
This something new can be an important new product or service, sell-
ing rapidly and causing earnings to accelerate above previous rates of
increase. It could also be new top management in a company during
the last couple of years. A new broom sweeps clean, or at least may
bring inspiring ideas and vigor to the ball game.

Or the new event could be substantial changes within the company's
industry. Industrywide shortages, price increases, or new technology
could affect almost all members of the industry group in a positive way.

New Products That Created
Super Successes

1. Rexall's new Tupperware division, in 1958, helped push the com-
pany's stock to $50 a share, from $16.
2. Thiokol in 1957-1959 came out with new rocket fuels for missiles,
propelling its stock from $48 to the equivalent of $355.
3. Syntex, in 1963, marketed the oral contraceptive pill. In six months
the stock soared from $100 to $550.
4. McDonald's, in 1967-1971, with low-priced fast food franchising,
snowballed into an 1100% profit for stockholders.
5. Levitz Furniture stock increased 660% in 1970-1971, with the pop-
ularity of their giant warehouse discount furniture centers.
6. Houston Oil & Gas, in 1972-1973, with a major new oil field ran up
968% in 61 weeks and later in 1976 picked up another 367%.
7. Computervision stock advanced 1235% in 1978-1980, with the
introduction of new Cad-Cam factory automation equipment.
8. Wang Labs Class B stock grew 1350% in 1978-1980, due to the cre-
ation of their new word-processing office machines.
9. Price Company stock shot up more than 15 times in 1982-1986
with the opening of a southern California chain of innovative
wholesale warehouse membership stores.
10. Amgen developed two successful new biotech drugs, Epogen and
Neupogen, and the stock raced ahead from 60% in 1990 to the
equivalent of 460% in January 1992.
11. Cisco Systems, another California company, created routers and
networking equipment that allowed company links with geographi-
cally dispersed local area computer networks. The stock advanced
over 2000% in 3V2 years.
12. International Game Technology rose an astounding 1600% in
1991-1993 with new microprocessor-based gaming products.

In our study of greatest stock market winners from 1953 through
1993, we discovered more than 95% of these stunning successes in
American industry either had a major new product or service, new man-
agement, or an important change for the better in the conditions of
their particular industry.

The Stock Market's Great
Paradox

There is another fascinating phenomenon we found in the early stage
of all winning stocks. We call it "the great paradox." Before I tell you
what this last new observation is, I want you to look at three typical
stocks shown on the next page. Which one looks like the best buy to
you? Which stock would you probably avoid?

Among the thousands of individual investors attending my investment
lectures in the 1970s, 1980s, and 1990s, 98% said they do not buy stocks
that are making new highs in price.

The staggering majority of individual investors, whether new or expe-
rienced, feel delightful comfort in buying stocks that are down substan-
tially from their peaks.

I have provided extensive research for over 600 institutional investors
in the United States. It is my experience that most institutional money
managers are also bottom buyers¡Xthey, too, feel safer buying stocks
that look cheap because they're either down a lot in price or selling
near their lows.

The hard-to-accept great paradox in the stock market is that what
seems too high and risky to the majority usually goes higher and what
seems low and cheap usually goes lower. Haven't you seen this happen
before?

In case you find this supposed "high-altitude" method a little difficult
to boldly act upon, let me cite another study we conducted. An analysis
was made of the daily newspapers' new-high and new-low stock lists dur-
ing several good, as well as poor, market periods.

Our findings were simple. Stocks on the new-high list tended to go
higher, and those on the new-low list tended to go lower.
Put another way, a stock listed in the financial section's new-low list of
common stocks is usually a pretty poor prospect, whereas a stock mak-
ing the new-high list the first time during a bull market and accompa-
nied by a big increase in trading volume might be a red-hot prospect
worth checking into. Decisive investors should be out of a stock long
before it appears on the new-low list.

You may have guessed by now what the last intriguing new realization
is that I promised to disclose to you earlier. So here are the three stocks
you had to choose among on the previous page, Stock A, Stock B, and
Stock C. Which one did you pick? Stock A (Syntex Corp, see below) was
the right one to buy. The small arrow pointing down above the weekly
prices in July 1963 shows the same buy point at the end of Stock A in
July on the previous page. Stock B and Stock C both declined.

When to Correctly Begin
Buying a Stock

A stock should be close to or actually making a new high in price after
undergoing a price correction and consolidation. The consolidation
(base-building period) in price could normally last anywhere from seven
or eight weeks up to fifteen months.

As the stock emerges from its price adjustment phase, slowly resumes
an uptrend, and is approaching new high ground, this is, believe it or
not, the correct time to consider buying. The stock should be bought
just as it's starting to break out of its price base.

You must avoid buying once the stock is extended more than 5% or
10% from the exact buy point off the base. Here is an example of the
proper time to have bought Reebok, at $29, in February 1986 before it
zoomed 260%. The second graph shows the correct time to have bought
Amgen at $60¡Xin March 1990¡Xbefore it jumped more than sixfold.

How Does a Stock Go from
$50 to $100?

As a final appeal to your trusty common sense and judgment, it should
be stated that if a security has traded between $40 and $50 a share over
many months and is now selling at $50 and is going to double in price,
it positively must first go through $51, $52, $53, $54, $55, and the like,
before it can reach $100.

Therefore, your job is to buy when a stock looks high to the majority
of conventional investors and to sell after it moves substantially higher
and finally begins to look attractive to some of those same investors.
In conclusion: Search for corporations that have a key new product
or service, new management, or changes in conditions in their industry.
And most importantly, companies whose stocks are emerging from
price consolidation patterns and are close to, or actually touching, new
highs in price are usually your best buy candidates. There will always be
something new occurring in America every year. In 1993 alone, there
were nearly 1,000 initial public offerings. Dynamic, innovative new com-
panies¡ bundle of future, potential big winners.

(Excerpt from 'How To Make Money in Stocks')

A = Annual Earnings Increases; Look for Meaningful Growth

2007-05-08T21:13:00.000+08:00

If you want to own part of a business in your home town, do you
choose a steadily growing, successful concern or one that is unsuccess-
ful, not growing and highly cyclical?

Most of you would prefer a business that is showing profitable growth.
That's exactly what you should look for in common stocks. Each
year's annual earnings per share for the last five years should show an
increase over the prior year's earnings. You might accept one year
being down in the last five as long as the following year's earnings
quickly recover and move back to new high ground.

It is possible that a stock could earn $4 a share one year, $5 the next
year, $6 the next, and the following year¡X$2. If the next annual earn-
ings statement were $2.50 versus the prior year's $2 (+ 25%), that would
not be a good report. The only reason it may seem attractive is that the
previous year ($2) was so depressed any improvement would look good.
In any case, the profit recovery is slow and is still substantially below the
company's peak earnings of $6:

Select Stocks with 25% to
50% Annual Growth Rates

Owning common stock is just the same as being a part owner in a busi-
ness. And who wants to own part of an establishment showing no growth?
The annual compounded growth rate of earnings in the superior firms
you hand pick for purchasing stock in should be from 25% to 50%, or
even 100% or more, per year over the last 4 or 5 years.

Between 1970 and 1982, the average annual compounded earnings
growth rate of all outstanding performing stocks at their early emerging
stage was 24%. The median, or most common, growth rate was 21% per
year, and three out of four of the prominent winners revealed at least
some positive annual growth rate over the five years preceding the giant
increase in the value of the stock. One out of four were turnarounds.
A typical successful yearly earnings per share growth progression for a
company's latest five-year period might look something like $.70, $1.15,
$1.85, $2.80, $4.

The earnings estimate for the next year should also be up a healthy
percentage; the greater the percentage, the better. However, remember
estimates are opinions. Opinions may be wrong whereas actual reported
earnings are facts that are ordinarily more dependable.

What Is a Normal Stock
Market Cycle?

Most bull (up) market cycles last two to four years and are followed by a
recession or bear (down) market and eventually another bull market in
common stocks.

In the beginning phase of a new bull market, growth stocks are usual-
ly the first sector to lead the market and make new price highs. Heavy
basic industry groups such as steel, chemical, paper, rubber, and
machinery are commonly more laggard followers.

Young growth stocks will usually dominate for at least two bull market
cycles. Then the emphasis may change for the next cycle, or a short
period, to turnaround or cyclical stocks or newly improved sectors of
the market, such as consumer growth stocks, over-the-counter growth
issues, or defense stocks that sat on the sidelines in the previous cycle.
Last year's bloody bums become next year's heroes. Chrysler and
Ford were two such spirited turnaround plays in 1982. Cyclical and
turnaround opportunities led in the market waves of 1953¡X1955,
1963-1965, arid 1974-1975. Papers, aluminums, autos, chemicals, and
plastics returned to the fore in 1987. Yet, even in these periods, there
were some pretty dramatic young growth stocks available. Basic industry
stocks in the United States frequently represent older, more inefficient
industries, some of which are no longer internationally competitive and
growing. This is perhaps not the area of America's future excellence.
Cyclical stocks' price moves tend to be more short-lived when they do
occur, and these stocks are much more apt to suddenly falter and
encounter disappointing quarterly earnings reports. Even in the stretch
where you decide to buy strong turnaround situations, the annual com-
pounded growth rate could, in many cases, be 5% to 10%.

Requiring a company to show two consecutive quarters of sharp earn-
ings recovery should put the earnings for the latest twelve months into,
or very near, new high ground. If the 12 months earnings line is shown
on a chart, the sharper the upswing the better. This will make it possi-
ble in many cases for even the "old dog" about-face stock to show some
annual growth rate for the prior five-year time period. Sometimes one
quarter of earnings turnaround will suffice if the earnings upswing is so
dramatic that it puts the 12 months ended earnings line into new highs.

Check the Stability of a
Company's Five-Year
Earnings Record

While the percentage rate of increase in earnings is most important, an
additional factor of value, which we helped pioneer in the measure-
ment and use of, is the stability and consistency of the past five years'
earnings. We display the number differently than most statisticians do.
Our stability measurements are expressed on a scale from 1 to 99.
The lower the figure, the more stable the past earnings record. The fig-
ures are ca^ulated by plotting quarterly earnings for the last five years
and fitting a trend line around the plot points to determine the degree
of deviation from the basic earnings trend.

Growth stocks with good stability of earnings tend to show a stability
figure below 20 or 25. Equities with a stability rating over 30 are more
cyclical and a little less dependable in their growth. All other things
being equal, you may want to choose the security showing a greater
degree of consistency and stability in past earnings growth.
Earnings stability numbers are usually shown immediately after a
company's five-year growth rate, although most analysts and investment
services do not bother to make the calculation.

If you primarily restrict your selections to ventures with proven
growth records, you avoid the hundreds of investments having erratic
earnings histories or a cyclical recovery in profits that may top out as
they approach earnings peaks of the prior cycle.

How to Weed Out the Losers
in a Group

When you investigate a specific industry group, using the five-year
growth criteria will also help you weed out 80% of the stocks in an
industry. This is because the majority of companies in an industry have
lackluster growth rates or no growth.

When Xerox was having its super performance of 700% growth from
March 1963 to June 1966, its earnings growth rate averaged 32% per
year. Wal-Mart Stores, a discount retailer, sported an annual growth
rate from 1977 to 1990 of 43% and boomed in price an incredible
11,200%. Cisco Systems growth rate in October 1990 was an enormous
257% per year and Microsoft's was 99% in October 1986, both before
their long advances.

The fact that an investment possesses a good five-year growth record
doesn't necessarily cause it to be labeled a growth stock. Ironically, in
fact, some companies called growth stocks are producing a substantially
slower rate of growth than they did in several earlier market eras. These
should usually be. avoided. Their record is more like a fully matured or
nearly senile growth stock. Older and larger organizations frequently
show slow growth.

New Cycles Create New
Leaders

Each soaring new cycle in the stock market will catapult fresh leader-
ship stocks to the attention of the market, some of which will begin to
be called growth stocks. The growth record in itself, however, is only a
starting point for would-be victorious investors, and it should be the
first of many earnings measurements you should check.
For example, companies with outstanding five-year growth records of
30% per year but whose current earnings in the last two quarters have
slowed significantly to + 15% and + 10% should be avoided in most
instances.

Insist on Both Annual and
Current Quarterly Earnings
Being Excellent

We prefer to see current quarterly earnings accelerating or at least main-
taining the trend of several past quarters. A standout stock needs a
sound growth record during recent years but also needs a strong current
earnings record in the last few quarters. It is the unique combination of
these two critical factors, rather than one or the other being outstanding,
that creates a superb stock, or at least one that has a higher chance of
true success.

Investor's Business Daily provides a relative earnings ranking (based
on the latest five-year annual earnings record and recent quarterly earn-
ings reports) for all common stocks shown in the daily NYSE, AMEX,
and OTC stock price quotation tables.

More than 6000 stocks are compared against each other and ranked on
a scale from 1 to 99. An 80 earnings per share rank means a company's
current and five-year historical earnings record outclassed 80% of all
other companies.

The earnings record of a corporation is the most critical, fundamental
factor available for selecting potential winning stocks.

Are Price-Earning Ratios
Important?

Now that we've discussed the indispensable importance of a stock's cur-
rent quarterly earnings record and annual earnings increases in the last
five years, you may be wondering about a stock's price-to-earnings
(P/E) ratio. How important is it in selecting stocks? Prepare yourself for
a bubble-bursting surprise.

P/E ratios have been used for years by analysts as their basic measure-
ment tool in deciding if a stock is undervalued (has a low P/E) and
should be bought or is overvalued (has a high P/E) and should be sold.
Factual analysis of each cycle's winning stocks shows that P/E ratios
have very little to do with whether a stock should be bought or not. A
stock's P/E ratio is not normally an important cause of the most suc-
cessful stock moves.

Our model book studies proved the percentage increase in earnings
per share was substantially more crucial than the P/E ratio as a cause of
impressive stock performance.

During the 33 years from 1953 through 1985 the average P/E for the
best performing stocks at their early emerging stage was 20 (the Dow
Jones Industrial's P/E at the same time averaged 15). While advancing,
these stocks expanded their P/Es to approximately 45 (125% expansion
of P/E ratio).

..to be continued..

(Excerpt from 'How To Make Money from Stocks')

C = Current Quarterly Earnings Per Share: How Much Is Enough?

2007-05-02T21:47:00.000+08:00

M/A-Com Inc.
Humana Inc.
Kirby Exploration Co.

What did shares of the above-mentioned microwave component man-
ufacturer, hospital operator, and oil Service Company have in common?
From 1977 to 1981, they all posted price run-ups surpassing 900%.
In scrutinizing these and other past stock market superstars, I've
found a number of other similarities as well.

For example, tradiiig volume in these sensational winners swelled
substantially before their giant price moves began. The winning Stocks
also tended to shuffle around in price consolidation periods for a few
months before they broke out and soared. But one key variable stood
out from all the rest in importance: the profits of nearly every outstand-
ing stock were booming.

The common Stocks you select for purchase should show a major per-
centage increase in the current quarterly earnings per share (the most
recently reported quarter) when compared to the prior year's same
quarter.

Earnings per share are calculated by dividing a company's total after-
tax profits by the company's number of common shares outstanding.
The percentage increase in earnings per share is the single most impor-
tant element in stock selection today.

The greater the percentage of increase, the better, as long as you
aren't misled by comparing current earnings to nearly nonexistent
earnings for the year earlier quarter, like 1 cent a share.

Ten cents per share versus one cent may be a 900% increase, but it is
definitely distorted and not as meaningful as $1 versus $.50. The 100%
increase of $1 versus $.50 is not overstated by comparison to an unusu-
ally low number in the year ago quarter.

I am continually amazed at how many professional pension fund
managers, as well as individual investors, buy common stocks with the
current reported quarter's earnings flat (no change), or even worse,
down. There is absolutely no reason for a stock to go anywhere if the
current earnings are poor.

Even if the present quarter's earnings are up 5% to 10%, that is sim-
ply not enough of an improvement to fuel any significant upward price
movement in a stock. It is also easier for a corporation currently show-
ing a mere increase of 7% or 8% to suddenly report lower earnings the
next quarter.

Seek Stocks Showing Big
Current Earnings Incrcascs

In our models of the 500 best performing Stocks in the 40 years from
1953 through 1993, three out of four of these securities showed earn-
ings iricreases averaging rnore than 70% in the latest publicly reported
quarter before the Stocks began their major price advance. The one out
of four that didn't show solid current quarter increases did so in the
very next quarter, and those increases averaged 90%!

If the best Stocks had profit increases of this magnitude before they
advanced rapidly in price, why should you settle for mediocre or down
earnings?

Our study showed that among all big gainers between 1970 and 1982,
86% reported higher earnings in their most recently published quarter,
and 76% were up over 10%. The median earnings increase was 34%
and the rnean (average) was up 90%.

You may find that only about 2% of all Stocks listed for trading on the
New York or American stock exchanges will, at any one time, show
increases of this proportion in current quarterly net iiicome.
But, remember you want to find the exceptional Stocks rather than
the lackluster ones, so set your sights high and Start looking for the
superior Stocks, the small number of real leaders. They are there.
Success is built on dreanis and ideas; however, it helps to know exact-
ly what you're looking for. Before you Start your search for tomorrow's
super stock market leader, let nie teil you about a few of the traps and
pit falls.

Watch Out for Misleading
Reports of Earnings

Have you ever read a corporation's quarterly earnings report that stated,
"We had a terrible first three months. Prospects for our Company are turn-
ing down due to inefficiencies in the home office. Our competition just
came out with a better product, which will adversely affect our sales.
Furthermore, we are losing our shirt on the new midwestern Operation,
which was a real blunder on management's part."

No! Here's what you see. "Greatshakes Corporation reports record sales
of $7.2 million versus $6 million (+ 20%) for the quarter ended March
31." If you own their stock, this is wonderful news. You certainly are not
going to be disappointed. You think this is a fine Company (otherwise you
wouldn't own its stock), and the report confirms your thinking.
Is this record-breaking sales armouncement a good report? Let's sup-
pose the Company also had record earnings of $2.10 per share of stock for
the quarter. Is it even better now?

What if the $2.10 was versus $2 (+ 5%) per share in the same quarter
the previous year? Why were sales up 20% and earnings ahead only 5%?
Something might be wrong¡Xrnaybe the company's profit margins are
crumbling. At any rate, if you own the stock, you should be concerned and
evaluate the Situation closely to see why the earnings increased only 5%.
Most investors are impressed with what they read, and companies love
to put their best foot forward. Even though this corporation may have had
all-time record sales, up 20%, it didn't mean much. You must be able to
see through slanted published presentations if you want the vital facts.
The key factor for the winning investor must always be how much the
current quarter's earnings are up in percentage terms from the same quar-
ter the year before!

Let's say your Company discloses that sales climbed 10% and net income
advanced 12%. This sounds good, but you shouldn't be concerned with
the company's total net income. You don't own the whole organization.
You own shares of stock in the corporation. Perhaps the Company issued
additional shares or there was other dilution of the common stock. Just
because sales and total net income for the Company were up, the report
still may not be favorable. Maybe earnings per share of common stock
inched up only 2% or 3%.

The Debate on Overemphasis
of Current Earnings

Recently it has been noted that Japanese firms concentrate more on
longer-term profits rather than on trying to maximize current earnings
per share.

This is a sound concept and one the better-managed organizations in
the United States (a minority of companies) also follow. That is how
well-managed entities create colossal quarterly earnings increases, by
spending several years on research, developing superior new products,
and cutting costs.

But don't be confused. You as an individual Investor can afford to wait
until the point in time when a Company positively proves to you its
efforts have been successful and are starting to actually show real earn-
insrs increases.

Requiring that current quarterly earnings be up a hefty amount is just
another smart way the intelligent Investor can reduce the risk of exces-
sive mistakes in stock selection.

Many corporations have mediocre management that continually pro-
duces second-rate earnings results. I call them the "entrenched main-
tainers." These are the companies you want to avoid until someone has
the courage to change top management. Ironically, these are generally
the companies that strain to pump up their current earnings a dull 8%
or 10%. True growth companies with outstanding new products do not
have to maximize current results.

Look for Accelerating
Quarterly Earnings Growth

My studies of thousands of the most successful concerns in America
proved that virtually every corporate stock with an outstanding upward
price move showed accelerated quarterly earnings increases some time
in the previous ten quarters before the towering price advance began.
Therefore, what is crucial is not just that earnings are up or that a
certain price-to-earnings ratio (a stock's price divided by its last twelve
months' earnings per share) exists; it is the change and improvement
from the stock's prior percentage rate of earning increases that causes a
supreme price surge. Wall Street now calls these earnings surprises.
I once mentioned this concept of earnings acceleration to Peter
Vermilye, the former head of Citicorp's Trust Investment Division in
New York City. He liked the term and feit it was much more accurate
and relevant than the phrase "earnings momentum" sometimes used by
Investment professionals.

If a Company's earnings are up 15% a year and suddenly begin spurt-
ing 40% to 50% a year, it usually creates the basic conditions for impor-
tant stock price improvement.

Check Other Key Stocks in
the Group

For added safety, it is wise to check the industry group of your stock.
You should be able to find at least one other noteworthy stock in the
industry also showing good current earnings. This acts as a confirming
factor. If you cannot find any other impressive stock in the group dis-
playing strong earnings, the chances are greater that you have selected
the wrong investment.

Note the date when a company expects to report its next quarterly
earnings. One to four weeks prior to the report's release, a stock fre-
quently displays unusual price strength or weakness, or simply "hesitates"
while the market and other equities in the same group advance. This
could give you an early clue of an approaching good or bad report. You
may also want to be aware and suspicious of stocks that have gone several
weeks beyond estimated reporting time without the release of an earn-
ings announcement.

One last point to clarify: You should always compare a stock's per-
centage increase in earnings for the quarter ended December, to the
December quarter a year earlier. Never compare the December quarter
to the immediately prior September quarter.

You now have the first critical rule for improving your stock selection:
Current quarterly earnings per share should be up a major percentage
(at least 20% to 50% or more) over the same quarter last year. The best ones
might show earnings up 100% to 500%! A mediocre 8% or 10% isn't
enough! In picking winning stocks, it's the bottom line that counts.

-Excerpt from William O'Neal's How To Make Money in Stocks.

How To Make Money In Stocks.

2007-04-24T21:22:00.000+08:00

Introduction:
Learning from the Greatest
Winners

In the following chapters, I will show you exactly how to pick more big
winners in the stock market and how to substantially reduce your losses
and mistakes. I will examine and discuss other Investments, as well.
In the past, most people who bought and sold Stocks either had
mediocre results or lost money because of their clear lack of knowledge.
But no one has to lose money.

This book will provide you with most of the investment understand-
ing, skills, and methods you need to become a more successful Investor.
I believe that most people in this country and many others through-
out the free world, young and old, regardless of profession, education,
background, or economic position, can and defmitely should own com-
mon stock. This book isn't written for an elite but for the millions of lit-
tle guys and gals everywhere who want a chance to be better off.
YOU CAN If you are a typical working man or woman or a
START SMALL beginning Investor, it doesn't take a lot of
money to Start. You can begin with as little as
$500 to $1000 and add to it as you earn and
save more money. I began with the purchase
of just five shares of Procter & Gamble when
I was only 21 and fresh out of school.

You live in a fantastic tinie of unlimited opportunity, an era of out-
standing new ideas, emerging industries, and new frontiers. But you
have to read to learn how to recognize and take advantage of these
extraordinary Situation<<.

The opportunities are out there for everyone. You are now witnessing
a New America. We lead the world in high technology, medical
advancements, Computer Software, military capabilities, and innovative
new entrepreneurial companies. The communist socialist System was
finally relegated to the ash heap of history under Ronald Reagan and
our System of freedom and opportunity serves as a prime success model
for the majority of countries in the world.

It is not enough today to just work and earn a salary. To do the things
you want to do, to go the places you want to go, to have the things you
want to have in your life, you absolutely must save and invest intelligent-
ly. The second income from your Investments and the net profits you
can make will help you reach your goals and provide real security.
SECRET TIP #1 The first Step in learning to pick stock market
winners is for you to examine leading winners
of the past to learn all the characteristics of the
most successful Stocks. You will learn from this
observation what type of price patterns these
Stocks developed just before their spectacular
price advances.

Other key factors you will uncover include what kind of Company
quarterly-earnings reports were publicly known at the time, what the
annual earnings histories of these organizations had been in the prior
five years, what amount of stock trading volume was present, what
degree of relative price strength occurred in the price of the Stocks
before their enormous success, how many shares of common stock were
outstanding in the capitalization of each Company, how many of the
greatest winners had significant new products or new management, and
how many were tied to strong industry group moves caused by impor-
tant changes occurring in an entire industry.

It is easy to conduct this type of practical, commonsense analysis of
past successful leaders. I have already completed such a comprehensive
study. In our historical analysis, we selected the greatest winning Stocks
in the stock market each year (in terms of percentage increase for the
year), spanning more than 40 years.

We call the study The Record Book of Greatest Stock Market Winners.
It covers the period from 1953 through 1993 and analyzes in detail over
500 of the biggest winning companies in recent stock market history:
super Stocks such as Texas Instruments, whose price soared from $25 to
$250 from January 1958 through May 1960; Xerox, which escalated
from $160 to the equivalent of $1340 from March 1963 to June 1966;

Syntex, which leaped from $100 to $570 in only six rnonths during the
last half of 1963; Dome Petroleum and Prime Computer, which respec-
tively advanced 1000% and 1595% in the 1978-1980 stock market;
Limited Stores, which wildly excited lucky shareowners with a 3500%
increase between 1982 and 1987; and Cisco Systems, which advanced
from a split-adjusted $1.88 to $40.75 between October 1990 and March
1994. Home Depot and Microsoft both increased more than 20 times
during the 1980s and early '90s. Home Depot was one of the all-time
great performers jumping twentyfold in less than 2 years from its initial
public offering in September of 1981 and then again climbing another
10 times from 1988 to 1992. All of these companies offered exciting
new products and concepts.

Would you like to know the common characteristics and secret rules
of success we discovered from this intensive study of all past glamorous
stock market leaders?

It's all in the next few chapters and in a simple easy-to-remember for-
mula we have named C-A-N S-L-I-M. Write the formula down, and
repeat it several times so you won't forget it.

Each letter in the words C-A-N S-L-I-M Stands for one of the seven
chief characteristics of these great winning Stocks at their early develop-
ing stages, just before they made huge profits for their shareholders.
You can learn how to pick winners in the stock market, and you can
become part owner in the best companies in the world. So, let's get
started right now. Here's a sneak preview of C-A-N S-L-I-M.

C = Current Quarterly Earnings Per Share: How Much Is Enough?
A = Aimual Earnings Increases: Look for Meaiiingful Growth.
N = New Products, New Management, New Highs: Buying at the Right Time.
S = Supply and Demand: Small Capitalization Plus Volume Demand.
L = Leader or Laggard: Which Is Your Stock?
I = Institutional Sponsorship: A Little Goes a Long Way.
M = Market Direction: How to Determine It?

(Excerpt from William O'Neal's How to make money in stocks.)

The Principles of Successful Trading

2007-04-17T21:29:00.000+08:00

Over many years of trading, I've found certain principles to be true. Understanding and using basic principles provides an anchor of sanity when trading in a crazy world. Whenever I find myself under stress, questioning my judgement or my ability to trade successfully, I pull out these basic trading principles and review them.

Don't Try to Predict the Future

I used to think that there were experts and geniuses out there who knew what was going to happen in the markets. I thought that these traders and market gurus were successful because they had figured out how to predict the markets. Of course, the obvious question is that if they were such good traders, and if they knew where the market was going, why were they teaching trading techniques, selling systems and indicators, and writing newsletters? Why weren't they rich? Why weren't they flying to the seminars on their Lear Jets?

NO ONE KNOWS WHERE THE MARKET IS GOING

It took me a long rime to figure out that no one really understands why the market does what it does or where it's going. It's a delusion to think that you or any one else can know where the market is going. I have sat through hundreds of hours of seminars in which the presenter made it seem as if he or she had some secret method of divining where the markets were going. Either they were deluded or they were putting us on. I have seen many complex Fibonacci measuring methods for determining how high or low the market would move, how much a market would retrace its latest big move, and when to buy or sell based on this analysis. None has ever made
consistent money for me.

NO ONE KNOWS WHEN THE MARKET WILL MOVE

It also has taken me a long time to understand that no one knows when the market will move.There are many individuals who write newsletters and/or books, or teach seminars, who will tell you that they know when the market will move.Most Elliot Wave practitioners, cycle experts, or Fibonacci time traders will try to predict when
the market will move, presumably in the direction they have also predicted. I personally have not been able to figure out how to know when the market is going to move. And you know what? When I tried to predict, I was usually wrong, and I invariably missed the big move I was anticipating, because "it wasn't time."
It was when I finally concluded that I would never be able to predict when the market will move that I started to be more successful in my trading. My frustration level declined dramatically, and I was at peace knowing that it was OK not to be able to predict or understand the markets.

Know that Market Experts aren't Magicians

Some of the experts that try to predict the markets actually make money trading the markets; however, they don't make money because they have predicted the market correctly, they make money because they have traded the market correctly.

THEY DON'T PROFIT FROM THEIR PREDICTIONS

There is a huge difference between trading correctly and making an accurate market prediction. In the final analysis, predicting the market is not what's important. What is important is using sound trading practices. And if sound trading habits is all that is important, there is no reason to try to predict the markets in the first place. This is the reason system trading makes so much sense.

THEY HAVE LEARNED TRADING DISCIPLINE

I have watched many market gurus continually make incorrect market predictions and still break even or make a little money because they have followed a disciplined approach to trading. More importantly, they used the exact same principles that I will show you how to use in creating your system. It is these principles that make the money, not the prediction. To be a disciplined trader, you have to know how and why to enter the market, when to exit the market, and where to place your money management stops. You need to manage your risk and maximize your cash flow. A sound trading system includes entries, exits, and stops as well as sound cash management strategies.Even the market gurus and famous traders don't make money from their predictions, they make it from proper trading discipline. Over the years, they have learned the discipline to control their risk through money management. They have learned to take the trades as they come, and not forgo a trade because they are second-guessing their system or the market. These are the same practices that you will learn to include in your trading system.

THEY PROFIT FROM SOUND CASH MANAGEMENT & RISK CONTROL

Sound money management and risk control are the keys to being a profitable trader. I will say over and over again, it is not the prediction or the latest and greatest indicator that makes the profit in trading, it is how you apply sound trading discipline with superior cash management and risk control that makes the difference between success and failure. I often tell the story of the great fish restaurant that opened up just down the street from my office. It opened with great fanfare and was ranked in the top five restaurants in the city. The food was outstanding. But it only took a little more than a year and this great restaurant was out of business. Why? Because the key to running a good restaurant is not the food. It is cash management and risk control. It is making sure your business is run efficiently, keeping your costs (risk) in control, and managing your staff effectively. If you believe that the taste of the food is what makes a great restaurant, think of how great the food is at your favorite fast food restaurant. But, someday, watch how well that restaurant is run. Just as in the restaurant business, the key to profits in trading is not in the prediction or the indicator, but how well the trading system is designed and executed. The ability to achieve risk control and cash management will make the difference between a successful trader and an unsuccessful trader. If you ever have the opportunity to watch a successful trader, you will see
that they don't worry about where the market is going or about predicting when the next big move will take place. They aren't looking to tweak their indicator. They are worried about their risk on each trade. Is the trade being executed correctly? How much of their total account is at risk? Are the stops in the right place? And so on.

THEY DON'T HAVE SUPERIOR PERFORMANCE NUMBERS

If you want to have some fun, look at the performance of a successful market expert, one who is known for his or her market predictions and trading expertise. You will find that their performance numbers really aren't any better than an average trading system. The percentage of profitable trades, the return on the account, average profit to average loss, number of losing trades in a row.. .all of these trading parameters are within the average trading system performance parameters.Why is this? Because you can't predict where the market will go and when it will move. But if
you use correct system trading disciplines, you will make money whether you try to predict the market or just trade a good system. You might as well save yourself a lot of time, energy, and mental anguish and trade a good system.

-Excerpt from 'Trading as a Business' , next post 'Be In Harmony with the Market'

Trading as a Business

2007-04-10T21:51:00.000+08:00

Prologue: Where to Begin

Let's begin with the markets themselves, and with fear and greed. We have all heard the cliches about fear and greed. They rule the markets. In fact, that's all the markets are-- reflection of these emotions. In order to make money trading, you must learn to control your fear and greed.

Overcoming Fear and Greed

We all have to deal with our runaway emotions at various times in life, and these emotions really begin to run away when we trade. Bill Williams' used to say in his seminars that trading was the clearest window into your own personal psychology, clearer than any other endeavor. I think he was right.

UNDERSTANDING THE MARKETS

We give in to our fear when we don't take the next trade because we've just been through a string of losers and fear losing again. We give in to our fear when we put our stop loss too close and get stopped out of a trade without giving the trade enough room to develop. We give in to our fear when we freeze as a trade starts to lose money, and we don't take the exit signal because we're afraid of losing money.
We give in to our greed when we take a profit early, before the regular signal, because we don't want to give back any of the profits. We give in to our greed when we trade more contracts or shares than we normally would because we feel good about this trade.

So we start with the question, "How can we understand the markets?" If we understand how they work, we can get a better understanding of ourselves, and in turn be better traders.

Controlling greed takes discipline. As far as fear, Peter Steidlmayer explained in his work with Market Profile that markets exist for one purpose and one purpose only--they exist to facilitate trade. Facilitating trade means that the markets will do anything they can to get individuals to participate in the market. How they do this is through movement. Markets move up and down searching for buyers and sellers.
The crucial point here is that markets must move for their survival. Understanding this literally changed the way I thought about the markets. Think about it. Markets have to move! This concept is major for anyone who has had to sit through a trend-following system trading in a sideways market. The knowledge that the market has to move eventually changes the way you look at trading. It gives you confidence that the string of losses can't continue indefinitely. It eliminates the fear!

You see, Steidlmayer explained that if a market does not facilitate trade, it will die. If it does not continue to bring traders in, to lure the buyers and sellers, the market will cease to exist. And the prime directive of a market is survival. To keep traders interested, the market has to move. It cannot remain in a small trading range or traders will lose money, become disinterested and leave. Eventually there will be less and less liquidity, traders will stop trading, and the market
will die.

Knowing that a market must facilitate trade and move, or else die, has given me great confidence in trading. When I am forced to trade through quiet markets, I remember this principle. This principle has reduced my fear and increased my confidence immeasurably.

SYSTEM TRADING: MAKING GOOD BUSINESS SENSE

For me, system trading is the only answer to the problem of fear and greed, and it is the only logical way to take advantage of the concept of Market Facilitation.
First, trading a system provides the discipline necessary to begin overcoming fear and greed.

Trading a system that has been back tested on historical, quantifiable data is a major way to inject discipline into your trading and to begin to control your fear and greed. If we think of a trading system as a small business, we can design our business to make money based on historical simulations. Then, our job becomes the implementation of the system rather than the interpretation of the market. If the system loses money and busts, we change the system. It's a matter of good business sense.

Second, if we know that a market must facilitate trade to stay alive, we can devise systems that guarantee that we will always be in for that inevitable big move. If we know that the big move will eventually come, and devise the system accordingly, our task becomes to minimize the drawdown (investment) while we wait. I have never been able to predict when the market was going to facilitate trade and get in for the big move. Instead, I have devised systems to ensure that I will be in for the big ride and my losses will be minimized while I wait. It's just a matter of good business sense.

As a businessman, I have concluded that the only rational way to trade the markets is to trade a system. All of the hocus-pocus about predicting when this market will move, and how far, is just that--Xhocus-pocus. The people that make the big money are the ones who don't try to predict tops and bottoms but who consistently take a little out of the middle. The only logical way to do this consistently is through a well thought-out, well-designed system. It's a matter of good business sense.

THE ADVANTAGE OF TECHNOLOGY

Anyone serious about finding a profitable system should use the latest technology and the best software available. This means learning how to use a computer.
When I started trading, all historical testing had to be done by hand. This was labor intensive and very time consuming. It was necessary to peruse charts visually and record the simulated entries and exits by hand.

For intra-day charts, this process was even more time consuming--the charts had to be printed with the indicators on them and for a significant length of time (several months). If these indicators didn't prove to be profitable, the process had to be repeated for the next month with revised indicators. This process continued month after month. It would sometimes take me three to six months to find a system that would work under current market conditions.

System Writer, followed of course by TradeStation, was the first computer program to help eliminate this labor intensive historical testing. Using TradeStation to do your testing has three distinct benefits.

The first is the amount of time saved. With TradeStation on a fast PC, it's possible to test in 5 to 30 minutes systems that literally used to take hours or days to test by hand. If you place any value on your time, this cost savings alone is impressive.
Second, you can avoid mental mistakes. I have, in both myself and in talking to other researchers, found a propensity for making mistakes when performing manual historical testing.

On many occasions I have found myself changing the system midstream. I have sometimes made the assumption that of course I wouldn't have taken that particular trade, when the reality is I probably would have, or of course I would have moved my stop up, when in reality I probably wouldn't have, and so on.

I can recall many situations where, when testing manually, I got different results on different days with the same data and the same system. I was either in a different frame of mind or in a different emotional state and actually made different decisions on the same data!

A computer, however, cannot trade a system differently tomorrow using the same parameters and data as it is using today. Its logic is consistent and can't play tricks on it. For historical testing, you can avoid this very real problem by using a computer.

Third, you can be more creative. Rather than spend all of your time doing the testing, you can have the computer do the testing and you can spend your time researching new trading ideas.

System development is like any other business. It's very unusual to find a successful business where only one individual has designed the product, does the marketing, is engaged in product development, and runs the machine to produce, package, and ship the product.

It is much easier and less stressful to hire a staff to handle the paperwork and production employees to make the product. The entrepreneur can then spend his or her valuable time in product development and planning the future of the company rather than running day-to-day operations.

As the futures and securities industry continues to grow, more and more traders will enter this business. The competition for profits will continue to increase. For example, in the early '80s it was very easy to make a lot of money day-trading the S&P. I used a simple dual moving average crossover system on 5-minute bar charts. There were proportionately very few intra-day traders with computers that were competing for profits. But since then, with the increase in the number of traders using intra-day charts, these very rudimentary indicators have stopped working. When everyone started using them, the profits dried up. It is much more difficult in today's markets to make the money that was there in the early years. The standard indicators just aren't that effective anymore.

Don't Believe What I Say

The final thing I want to tell you before you delve into this book is not to believe anything I say. Check it out for yourself. It would be a mistake for you to accept anything I say without a complete personal investigation, testing it for yourself and either proving or disproving the principles and techniques that I discuss. Just because I say it doesn't mean that it's true. It's what I believe to be true and has stood the test of time for me. But I urge you to be a skeptic, to think everything through and make sure it makes sense to you. Accept the things that work for you and
reject those that don't. The idea behind this book is to give you enough information so you can be self-sufficient. You shouldn't have to depend on anyone for your trading profits. You can do this yourself.

So we begin with three principles. First, the market must facilitate trade to survive; it must eventually make the big move. Second, you must be state of the art to compete, which means using the latest PC technology and TradeStation. Third, you can do this yourself, and you should not take what anyone says for granted.
You have the tools to be independent--to do this yourself.

Do not believe in anything simply because YOU have heard it.
Do not believe in traditions because they have been handed down for many generations.
Do not believe in anything because it is spoken and rumored by many.
Do not believe in anything simply because it is found written in your books.
Do not believe in anything merely on the authority of your teachers and elders.
But after observation and analysis, when you find that anything agrees with reason... then accept it
and live up to it.
-The Buddha

-Excerpt from Trading as a Business, next post: The Principles of Successful Trading.

Keep trading as Part of a Balanced life

2007-04-03T21:13:00.000+08:00

7. Keep trading as Part of a Balanced life:

Trading be it successfully or not, is a very stressful career. When
one is dealing with making and losing money based on your perceptions
the stresses can be enormous. You must do everything in your power to
eliminate the stresses.

I have never met or heard of a successful, highly stressed trader.
In fact it's quite the opposite. Most of the successful traders I have talked
to seem very relaxed and confident. I suppose this is what has made them
such success in the first place.

Reading Market Wizards' (Jack Swager) one common factor picked up on
all the best traders was their ability to disassociate them-selves with
the market action. It was almost as if they were unconcerned with their
positions. Considering some of these guys (and girls) traded with
hundreds of millions of dollars at a time this is a remarkable feat.
Most of the traders I know get excited when they have a couple of
hundred dollars at stake.

I know my own trading results went through the roof when I actually
spent less time "trying to control the market." By this I mean staring
at the quote machine and end of day graphs all the time. I took up tennis
lessons, jogging, reading, writing, even other business ventures just so I
could take my total focus away from the markets. Not only did my results
improve dramatically but so did my quality of life.

How can the top traders keep it so cool when the risks are so high?
Go through this book again:

1) They decided a long time ago to take responsibility and find out
what works

2) They have a system that fits them.

3) They plan every trade down to the finest detail ( wouldn't you if
you had $50 million at stake? more importantly they know when push
comes to shove they will follow the rules.

4) They have put the ground work into this system and continue to
do so.

5) They have complete confidence in both the system they follow
and in their own skill to flawlessly execute it.

6) They definitely view trading as a game in points and stopped
counting the money a long time ago. Most of the top traders are
very wealthy so if they aren't trading for enjoyment ( and winning)
they'd simply retire.

7) Finally they learned a long time ago that they alone can not control
the markets. Watching a quote machine and hanging on to "guru" advice
all day is a losing system. Most of the top traders have a life
out-side of trading. Realizing the importance of keeping it all in
balance.

Trading is no different from any other aspect of life. If your total
focus is on one point then every little dip and peak becomes exaggerated.
This kind of peak and valley emotional trading will not only ruin your
trading results but it could destroy you as a person as well.

Even if you was to make millions from the markets is it worth it at all
costs? Surely it's the journey that is important and not the arriving at
the destination.

In order to trade successfully you need to take time off. Re-charge the
batteries and gain some perspective. I remember my first few years as a
stock market player. I would spend all day, night, weekends reading,
studying, staring at the charts, trying different systems, etc....
Frankly I wouldn't wish it on any-one. Yes, I learned so much, without
the intensity of study I wouldn't have become so successful, so quickly
( 5 years) but if I had to do it again, or if I was giving advice to a new
trader, I would have kept my life much more balanced. "Work hard, play hard."
"Not work and work some more."

The stresses are big enough without making it the only focus in your life.
Take a ten year view on your performance. Realize that if you can gain just
a 30% return in the stock market year after year you are doing better than most.
Treat trading like any other business. Work hard from 9-5 and then be disciplined
to switch off and live your life.

Some of my very best trades have come from placing a buy order in the market
and setting a stop loss order with my broker. Going away for a months vacation
without looking at a share price. Coming back home and finding my share has jumped
by 40%. It never stops to amaze me how simple successful trading is.

Trading can be frustrating if you feel you can control the markets. There's this
feeling that by checking on the prices four times a day you will perform better. But
this is a complete waste of time and it leads you in to doing something stupid.
as long as you plan your system and follow those rules why would you ever need to
check on the prices during the day. Use the time intelligently and in so doing
it will give you more free time. Wasn't that the whole attraction of getting into
the stock originally?

Stock trading is a weird way to make a lot of money. We are brought up to
believe that to earn a honest days pay you must do an honest days work. But
if you buy $50,000 worth of stock at $50 and sell 1 year later at $200,
you have made $150,000 profit. Amazingly it only took 30 minutes to do this
as long as you checked the prices for 1 minute daily and followed your rules.
What elses is there to do? Yet, most people will have a problem making this
kind of money from the work put in. I am sure when the share hits $70 most
traders will snatch at the profits in order to take the sure profit and then
lose those profits chasing other trades. Yet it will be the balanced trader
who spends his time wisely and follows his rules who will always make the
big money.

So keep it in perspective. Realize you have no way of controlling the prices.
If you find your-self "itching" for more action then take up some interest AWAY
from the markets. NEVER try to make your trading more interesting or exciting.
If you do this you are forcing the markets into something that simply does not
exist.

If you spend more than 15 minutes per day managing your trades it's too long.
ask our-self whether you are trying to see something that doesn't exist.

Successful, profitable trading is:
* Boring
* Effortless
* Easy
* Stress free

AFTER you have MASTERED the "7 Habits of a Highly Successful Trader"
Are you going to spend the necessary time mastering these principles until
they become habits? A habit is something you do without thought. It takes a lot
of time and effort but the end results are worth it.

-Excerpt from the 7 Habits of Highly Successful Traders.

View Trading as a Score in Points and Not In Money

2007-03-28T18:07:00.000+08:00

6) View Trading as a Score in Points and Not In Money:

Really what I am saying is "follow your time tested rules which you
have complete belief in and forget about everything else"

How can you do that when it's money we are trading with? Use some
imagination. Pretend it's not money but simply a game your playing
and your account represents points scored. Stop counting dollars every
time the market moves and start concentrating on following your rules
flawlessly. When you can operate on this level not only do your profits
soar over the long run but it takes away all the stress of trading.

Think about it. No more are you watching the quotes intra-day thinking
"wow! I have just made enough to buy a new car," or
"uhhh.. I've just lost my holiday money" This kind of trading is emotionally
draining. No-one can succeed like this. This was me in my early days.I would
be so down when I checked my quotes during the day only to find I had lost
$500. And the next day when I found I was up by $500 I was the life and
sole of the party. Even if I could have made a success by trading this way
I wouldn't have enjoyed it and I would have given up.

Nowadays with my low risk/ high reward trading system I check the charts
at the end of day in 5 minutes and that's it. I simply ask my-self:
" Should I buy, sell or hold according to my rules?" I give my-self ten
seconds to answer and do what has to be done. I am not a trader any more
but a rule follower. That's how I feel. ( why do you think I have so much
time to write?)

Reading Market Wizards I and II it was a prominent feature I noticed
with all top traders. They never saw the markets as a cash box but simply
as a way of operating a business. the name of the business was to follow
their rules and score the points. It's not possible to become a top trader
if you view every tick in the market as money lost and gained.

If making and losing money leads to emotional distress and joy and
emotions are one of the most potent destroyers of successful trading then
common sense dictates that in order to be a Highly Successful Trader you
must eliminate all emotion from trading. How is this done? Easy, follow
the rules. How do you follow your rules? Make it THE most important
element in your trading. Forget about the money that will take care
of it-self it's all about those rules and how well you can follow them.

If you ever just read one book on the stock market then please let it be:
" How I Made $2 million" by Nicolas Darvas

I love this book so much because when you have read it as many times as
I have (50+) you begin to realize how well this guy turned his trading around
from an emotional losing trader into a robotice, disciplined, money, generating,
machine. What made his success possible? Apart from the usual accepting
complete responsibility, developing a system that fitted him, planning his
trades and lots of initial groundwork. The real reason he made so much money
was because he never counted the money in the general sense. He had a set of
rules and when it flashed a buy he placed on a percentage of his capital.
It made no difference whether it was $5,000 or $500,000, it was all the same
to him. He stopped counting money and flawlessly followed his rules.

If I could just describe a section that had profound effect on my trading.
In one trade Darvas bought $350,000 of a share at $53 1/2. The share then
climbed to over $100 and his broker telegrammed him with the message:

"profits now $250,000" Darvas now realized that whilst he had been so busy
concentrating on folowing his rules he has forgotten all about the paper
profits building up. When he received the telegramme he now knew if he sold
out he would be rich for life ( this was the 1950's) Every fiber in his body
was saying "sell. abandon your rules and take the profit."

So he walked around Paris trying to work out what to do. Questions and
thoughts such as will the share fall back? Should I sell and take the sure
profit? Shall I just break my rules this one time? Kept repeating them-selves
time and time again.

Finally he decided not to sell and to stick with his rules. It was
anything but easy to do. But he was proved right. In the weeks ahead
the share continued to rise and making that decision to stick to his
rules he was able to hold on and make much more profit.

Had he have constantly been calculating his trades on a day to day basis
in money terms I doubt he would have had the nerve to stay in so long.
Amazing story and one definitely worth reading.

You see how theory is all very well. Every trader worth his salt knows
the Wall Street sayings :

"cut your losses"
"let your profits run"
"trade with the trend" blah,blah,blah

But it is another ball game to do this in the heat of battle.
Time and time again when I enter a trade I want to bend the rules,
"just this one time." But I have gathered enough experience to realize
I can NEVER break my rules. Not one trade can be the exception. I
have learned to do this by counting in terms of points scored and not
money.

What separates the winners from the losers? It's certainly not
knowledge? I believe what really separates winners from losers is
the ability to follow your rules without exception, regardless of the
circumstances. Very few traders have the discipline to do this.

-Excerpt from 7 Habits of Highly Successful Traders.

123 System

2007-03-23T16:03:00.000+08:00

Rotary

2007-03-16T21:12:00.000+08:00

As requested. Rotary's recent price movement has corresponded nicely with its short-term support at the 50MA line. Coupled with declining volume, it looks to be consolidating well. Support is along the 50 moving average line (blue) and .82 , res at .945 region. Interesting volume to take note of along with price increase is in excess of 8 mil shares. RSI reading is on the verge of turning up from over-sold region whilst MACD is showing price momentum about to turn positive.

Positive Self-Belief

2007-03-13T21:47:00.000+08:00

5. Positive Self- Belief:

" All truly wise thoughts have been thought already thousands of times;
but to truly make them ours we must think them over again honestly,
till they take root in our personal experience."
- Goethe

Iron clad belief not only in the system you are trading but also in
your discipline to execute both entry and exits flawlessly are essential
to your success in trading.

The top traders know it is the discipline displayed in following their
rules that is the important thing in trading and the money rewards are
secondary. For if you can not execute your signals, on both entry and exit,
without question it takes just one mistake to give all those hard earned
profits back to the market.

Positive self-belief is built from repetition after repetition of
following your rules. Extensive back-testing of your system and
constant self analysis.

You'll never be able to follow a system if you have a doubt in your
mind. That's why so many people who buy other peoples systems fail.
When that system goes through a losing period the person who purchased it
will throw it away and search for the next system. Yet the trader who
has rock solid belief will be aware that the system does display periods of
losses. He's seen it all before and sits it out waiting for the conditions
to become more favourable. When they do he gets back in and makes a ton
more cash. The person who purchased the system in the meanwhile is now
losing more money with the new system because that too has just come into
a losing streak.

Only by doing the groundwork in section four will a trader have confidence
in a system. You must strive to work through as much market data as is
possible with any system so as to know what is normal and what isn't.
This is why even the top famous traders have losing streaks and they never
batter an eyelid. Every-one seems to be aware that George soros is the
greatest trader alive. The guy made billions in the 1980's and 1990's,
yet he as also had some amazing losing periods. His fund has also lost
billions and posted big negative returns. Did it bother him? He knew
that his style of trading will go through losing periods. Just as dawn
follows dusk, a losing period is usually followed by a winning period
and vise -versa. Yet too many traders throw in the towel after taking a
couple of successive losers. They are never around when the system kicks
into a big winning period.

What you believe is what you get. If you look at your problem areas you'll
find they are rooted in faulty and limited beliefs. So if you are having
problems with your trading results examine your beliefs about trading. If
deep down you have negative feelings about trading, or making money or you
lack complete confidence in either the system you are following or your-self
then you have to stop trading and go back and find out why.

A person who is a compulsive gambler will never make it trading the markets.
I'm sure when they lose a substantial amount of their capital then every-one
else will be to blame, but deep down if they analyzed their beliefs about trading
they would probably admit they see it as a big casino. If your beliefs about
making money are negative then how can you expect to make money in stocks?
I have heard of traders running accounts up to a ceiling figure, say $1 million
and then losing it all. They have repeated this several times before seeking help.
Usually, it is found that some deep seated, negative belief about making a lot
of money has caused them to push the self-destruct button. As Ed Seykota ( very
successful professional trader) says, every-one gets what they want from life.
You'll find in trading you'll get what you want.

You have to ask your-self what are your beliefs about trading? Are you told
continuously that trading is a no win game? It's a gamble? You can't win?
Trend following doesn't work? etc... Do you believe any of it? Write down
what you believe about trading. What kind of returns do you think are possible?
How much time and effort do you believe you must put into a day's work to obtain
a day's pay? When I first started trading I felt I needed to work hour after hour
every day. I checked on the quotes continuously, phoned my broker, read reports,
listened to the news, etc.. Why? Because I believed I had to put in hard work to
receive pay. It took a long time to shake that belief out.

If you believe it's relatively simple to make 50% p.a from the stock market
year in and year out, with very low risk and with just ten minutes work per
day then good, because it's possible. Then this is what you'll work towards
( I know many people will disagree but first ask whether these people are in
a position to pass comment).

On the other hand, if you believe just working ten minutes per day for a wage
is a lazy way to success and you feel uncomfortable with this then you will
have to resolve this conflict before you can obtain these results.

Choose your beliefs wisely. In all problems with your trading you are both
the problem and solution. The top traders know this. If they go through an
extensive period of losers they'll start analyzing their beliefs. Looking
inside and not out-side for the answers.

How do you develop poitive self-belief?

Foremost it has to be said it takes a lot of work (refer to the previous chapter.)
You will have to start with accepting total responsibility for your trading ,be
willing to put a lot of work into finding and testing a trading system.
The rest is built from experience. It takes years of experience for you to
develop the belief. A bit of a catch 22 but how do you gain experience in
trading? By staying in the game. Trade with such a small risk in the early
years that it hardly seems worth your while. View trading as a 20 year venture
and not a "get rich quick scheme."

It is only when you have total confidence will you be able to view your trading in
terms of points rather than money. Once you are on this level the rewards can be
staggering. Which brings me on to the next chapter.

(Excerpt from 7 Habits of Highly Profitable Traders.)

Work Hard at Learning How To Trade Properly and Keep Working.

2007-03-06T22:03:00.000+08:00

4. Work Hard at Learning How to Trade Properly and Keep Working:

This is no different from any other trade. Would you expect to
become a brain surgeon after attending a week-end seminar and reading
a few books? Yet, why do so many people expect to become a Market
Wizard within such a short period of time?

If you ever have the privilege to ask questions to a successful
trader you'll realize just how much effort, time, determination and
lost money it took until they arrived at where they are. Being a
consistent stock market winner is no different from being a top lawyer,
Doctor or businessman.

First you must decide that you really do want to trade. Ask your-self
is trading the stock market something I am genuinely interested in or
are you lured by the potential money it has to offer you? I always
remember reading a book called " Grow Rich With Peace of Mind"
Napolean Hill. Whilst interviewing the top people in a number of
professions he came to the conclusion that these people loved their
chosen fields. They would have done it for no money. Trading is the
same. If your number one goal in trading the markets is simply to make
as much money as possible then I doubt you'll make it into the super
trader status. If you are simply chasing the money it can be a
motivation as long as you are motivated to learn and work at what
really works in the market and NOT keep chasing the latest hot new
trading idea that exploits peoples love of money to make them act.

I am amazed at the number of traders who have not even read a
number of very basic stock market books. It seems it is too much
effort for them to read a book and learn some basic principles.
Yet, these people will blow a $10,000 account in less than 6
months chasing the pipe dream. Get real! Successful trading requires
not only a lot of ground work but on-going effort in order to keep
at the very top of your game.

In market wizards' I and II you will find that ,all but one trader,
went through years of trial and error, not to mention huge amounts
of effort until they became consistent, successful traders. Why
should it be any different for us? Are we saying we are better than
they are? Make no mistake, just like it takes many years of intense
studying to become a top lawyer, to become a top trader is no different.
If you are new then don't expect to strike out and make 80%+ returns
from the day you start. If you do then give me a call and I'll see
what you have that no-one else has. Consider the first three years
of your trading as going to University. The stock market is the
teacher and your initial account are your fees ( so keep it small)

So, what does it mean to work hard at your trading? I have broken
it down into two sections:

Firstly you will have to spend much time on analyzing your-self,
your personality, find a trading style you are most comfortable
with, learn how to trade properly, read, study, ask questions.
Basically, you are going to have to start from scratch and build
a system that fits you. It will take a couple of years at a minimum.
If this sounds like too much effort GOOD. You have just saved
your-self a lot of lost money. Forget trading and move on to
something which genuinely interests you.

If doing the above ground works sounds good, and you can't wait
to get started then may-be there is hope.

Once you have developed a trading system that fits you and you
have the iron clad discipline to follow your plan then it is a
constant battle to stay on top of your trading. As a trader you will
never get there, you are always getting there. You must strive to keep
improving. Never be satisfied with your trading system. Whilst I
don't say "keep looking for fault," I do say every system and trader can
be improved. The markets change their character over time, so keep
working on what impacts new developments have on them. Strive to
become even more disciplined and keep working on your mistakes.

Yes, even veteran traders still make silly mistakes. Look at
Jesse Livermore ( and I suggest you not only read this book, but
study and fear the way this guy operated). Livermore was a stock and
commodity trader way back in the early 1900's. He ran a small shoe-
string account into several millions but kept losing it. On the one
hand he was one of the greatest traders to have ever lived, yet on
the hand he was dangerous in that he could not control his emotions.
Having run an account up to millions and then losing it, one would
think this experience was painful enough so as not to be repeated?
Yet when he painfully started from scratch, built his account into
several million again, only to lose it in one bad trade, then the
alarm bells should have been ringing. Any-one can make a mistake
but to not learn from it is fatal. Sadly, after repeating this event
one more time he could not face the thought of making a come-back
again and took his own life.

So whilst Livermore was a top, top trader he never worked enough
on his own psychology. Had he worked on a sound money management
plan and strictly followed a plan for every trade he would not have
created this situation.

The lesson? Even when you have made it to become a successful trader
that one fatal mistake is lurking in the dark waiting to hit you.
Only by keeping on top of your emotions and working on your trading will
you avoid running into a catastrophe.

How long does it take to become a competent trader? There is no set
time but i would say as a general rule here are some guide-lines:
(0-1 yrs)

* Work on finding out whether you are willing to put the time
and effort into finding a system that not only works but fits your
personality.

* Read some basic books on the stock market. Don't just read them
and think "hmm that¡¦s interesting, next one.." Really try to get
inside the traders mind. Get a feel for how much time and effort
was put in before they became successful, how many times did they
go down closed avenues? What characteristic made them such a good trader?

* Using a very simple charting package, start looking at some bar charts
of shares and the markets. Do nothing but observe

* Buy a self help book. Could be a motivational book or similar work
and work through it. My trading and life has become so much better since
I started working on my-self. It will definitely help in finding a system
that fits you.

At the end of year 1 you should know whether trading is for you. And a
certain kind of trading technique should appeal to you more than others.
Go with this natural feel, it is the one that fits you personality.

If you find trading is not for you? Great! You have saved a lot of
time and money. Move on. It's not for every-one. I personally know of
some traders who will have to go back to the start if they wish to
succeed. In the meantime they keep handing money to the market.
It's sad because they've been trading for years. When will the penny
drop?

YEAR 2:

* Open an account with a small amount of cash. This is your learning
fees. Expect to lose it all as part of your fees.

* Keep reading, studying and asking successful
traders.

* Develop a style of trading you are comfortable with. Back test it
by hand and get a feel for the size, regularity and number of trades
your system gives out. Try to determine how many streaks it comes out
worth. ie did it have 5 successive losing trades? Did it have 7
successive winning trades? That way in the heat of battle and your system
has just given you 5 successive losers you know there is nothing wrong.
Get a feel for how it reacts in certain market cycles. Every system acts
better in certain market conditions than in others.

* Develop a plan. (re-read section 2) Try to accommodate for every
possibility.

* Keep observing the charts. I am not a great believer in paper trading
in order to find how much progress you have made in trading. Simply
because you have no emotions whilst playing games and it is controlling
emotions that separates the winners from the losers.

But what I am a great believer in is playing simulation games so as
to get a feel for how money management plays such an important role and
for you to get a feel for how any game of chance can and will have streaks.

This is what i do from time to time.

Get a hat or jar and place 100 marbles inside. I paint the winners blue
and the losers red. I paint a HR (home run >10 * Risk gain) on just four of
those marbles and I paint a BL ( big loss >4 * risk) on four of them. All
the rest are either 4 * Risk gains or 1 * risk losses. Here's the
interesting part. Start risking different dollar amounts on each trade
and see the difference in your results after 100 trades. This should
really hammer home the importance of money management.

Firstly, say you start with a $10,000 account risk just 2,5% on each
trade. Therefore, risk per one trade is $250 or R = $250. If you draw a
losing marble your account is debited $250. If you draw a winning marble
your account is credited by 4 * $250 = $1,000. If you hit a "Home Run"
then your account is credited by 10 * R = $2,500. On the other hand if
you hit a "big loss" trade then you are debited by $1,000.

Put the effort in and give this a try. You'll be amazed at the difference
position sizing can have on your account after 100 trades. You'll see even
in a 50/50 you run into streaks of winners and losers. Having 5 successive
winners and losers is quite common. Not only that try to imagine your-self
trading this system. How are you going to be feeling after taking 5
successive losses? Will you be feeling something is wrong. What happens if you
risk $500 per trade and you start off with a "big loser"? That's a $2,000
loss. Can you come back from this? Be pro-active and play around with the
figures it's a great simulation.

* If you feel comfortable trading make a trade.
The whole point of trading is to follow your rules. Making or losing
money is not the important point. Trade with such a small amount it
hardly seems worthwhile. What you want to know here is:

How do I react when my money is down?
Can I follow my rules?
Is my system working in the long run?

Year 3
You should have your own system that fits you and starting to take
small gains out of the market. If you still find your-self lacking the
discipline to follow the signals ask why? Keep playing the simulation
game as though it was your system and see why taking four or five
successive losing trades is acceptable as long as you can manage the risk.

Year 4
By now, if you are still trading, you should be pulling consistent profits
from the market and know your-self well enough to continue learning.
Consider learning to trade like taking a degree in the stock market.
Are you willing to sacrifice 4 years in order to learn the trade? If not, then
walk away now. If you are then get to it.

Don't be fooled by all the trade magazines saying you can pull 100%
out of the markets year in and year out with no effort. It isn't going
to happen. But if you really do keep working at it the rewards can be
amazing.

If you want to be a top trader there's a lot of work involved.

(Excerpt from 7 Habits of Highly Successful Traders)

Plan a Trade and Trade a Plan

2007-02-27T19:21:00.000+08:00

3) Plan a Trade and Trade a Plan:
Without doubt, no trader will last long if he doesn't plan every trade.
But there is absolutely no point in making a plan for a trade if you are not
disciplined enough to follow it.

A plan should cater for every eventuality. As Richard Dennis (Turtles fa
said, "Don't worry about where the prices are going. Worry about what
you are going to do when they get there."

Think about what is being said here. Once you put your money down on
trade you can not control the prices. So stop worrying about what could
happen and concentrate on you trigger points and what you will do when
these points are violated. By doing this your trading stops being emotional
and now becomes very systematic and stress free.

Look at this example:
1) you like the look of stock XYZ Corp. currently trading at $40 and you
place a buy 100, stop in at $42. This is just the beginning. You must then
ask and answer the following questions:

* IF filled on this trade where will where will I place my initial stop
loss. i.e "How much of my capital am I willing to lose?"

* IF filled on this trade how will I take profits? By how much will I
trail my stop? What exit strategies will I use?

* IF filled, will i add more shares as the trade goes my way?

* If filled and the share does not show a profit after X weeks, will
I get out, or will I let my trailing stop exit me from the trade.

* IF stopped out of this trade will i be willing to try and get back in,
or completely scratch the trade and look else-where?

2) So having made a complete plan, prior to entering the trade you place
the order to buy 100 XYZ corp at: $42.

3) You are filled at $42 1/4, automatically you place a stop order in at
$39. No guessing it's done automatically.

4) The trade goes your way and a second buy order is placed in at $50.

5) You buy 100 more at $50 and the stop is now moved up to $45.

6) The trade goes your way and you keep raising your stop at a safe
distance behind.

7) Your sell stop is hit at $130 and you exit the trade with a massive
profit.

Do you see now that by having a plan everything becomes automatic.
You know where to get in, place stops, add and exit. In short you are
now trading professionally and not from emotion.

Not once did you have to ask for opinion. Not once were you afraid
of letting a profit get away, or of a loss becoming too big.
Simply put, if you make a plan and have the discipline to follow it
trading becomes very simple and stress free.

In my many years of trading one point I try to get across to other
would be traders is the market will always do its utmost to throw
you off track. Once in a share it's a little like riding a wild horse.
The prices will thrash around violently shaking off all scared and
emotional traders. It will only be the ones who have the discipline
to follow a set plan that will benefit from the full move.

If you ever find your-self having to ask some-one for an opinion
on a stock you hold then it can only be because you either have not
made a plan, or you are second guessing the plan, in which case you may
as well not bother making one in the first place.

Planning a trade should be no different from planning a journey.
You must plan for all kinds of events. Especially the unforeseen ones.
Most of the time a trade will go your way and the plan will barely
have to be looked at but what if the share gaps down? flys up? goes
sideways for six weeks, the market crashes, the company announces a
complete surprise announcement which makes the share gain $30 in
one day? If you aren't prepared for these surprises then when
one does happen you are going to find yourself wandering what to do.
And once your are trading from the "hip" and not from a plan then
expect your results to worsen.

Having a plan totally removes all opinion and emotion from a
trade and anything which does this can only be good news.
Time and time again at seminars and meetings I hear the same
questions:

" I bought ABC stock at $25 a few months ago, do you think I
should still keep it?"

When I hear such questions I (discreetly) shake my head. How
can any-one trade such a way? Where is his plan? When he got into
the trade where was he get out point? Basically what the hell is
this guy doing trading? Does he really expect to out-perform the
market when he has to ask a third party about his stock holdings?

If this guy had a plan and more importantly the discipline to
follow he would never ask such a question.

This is probably the single biggest reason people love to
follow opinion. People just love to be told to do something
rather than thinking of it for them-selves. Reading a recent
Internet magazine I was astounded by the number of followers
some of the tip sheets have. The top ones have from 15,000
to 80,000. Are any of these followers really making them-selves
better traders? I have no doubt a small percentage are but the
majority aren't. Why? Because by following some-one else they
abondon the principles laid down in this book. There is no
system. Responsibility has no been shfted to the guru (so there's
the excuse for the losses in place) Worse of all they do not
have a solid plan.

When you start following your own plans you will find your-
self not wanting to listen to out-side opinion. If you hold ADF
stock and bought at $60 and your initial stop loss is at $56 then
why would you care if the local guru is saying, "Sell ADF it's
over-valued and will fall to $20." For one, he is just as likely
to be wrong as right and secondly if your stop is at $56 then let
this kick you out of the trade. At least that way when you ask
your-self "did I follow my rules today?" the answer will be YES.

I can guarantee before Warren Buffet, or George Soros buys
$50,000,000 worth of stocks they know exactly what they will do
if prices swing one way or another. Could you imagine Warren Buffet
thinking, " gee, I bought $20,000,000 worth of DFG stock and it's
down by 15%. what shall I do?" No way! And why should it be any
different for your trading? The point is it doesn't matter whether
you are trading with a $5,000 account or a $50,000,000 the
principles are the same. You must eliminate all emotion and follow
YOUR plan.

To be a winner in the markets you can never trade from emotion.
and the only way to eliminate emotion is to have the iron
discipline to follow your own plan. It's said most traders never
plan a trade never mind have the discipline to follow one.
If you want to become one of the few market winners you must

"Plan every trade and trade every plan"

(Excerpt from 7 Habits of Highly Successful Traders)

Have a System that Fits You

2007-02-21T21:49:00.001+08:00

As promised, below is the list of good growth stocks:

asiapharm

beauty china

china milk

china sky

cosco

ferrochina

frasers centrpoint trust

gallant venture

guocoland

ho bee

jiutian

keppel corp

labroy marine

longcheer

midas

pacific shipping trust

raffles education

raffles medical

rotary

sarin technology

singapore land

st engineering

sino environment

sp chemicals

sunpower

tech oil & gas

united envirotech

uic

wilmar

yanlord

The above stocks are highlighted according to several factors, most of which are earnings per share and revenue growth. Enjoy.

2) Have a System that Fits You:

Every successful trader, investor, money manager, etc.. has a system that fits them. Some are long term, some mechanical, some intuitive, day traders, scalpers, arbitrage, value, momentum. The system its self is not the important factor. What is? Is that the system fits their unique personality.

The system does not matter. I've heard of value investors (WarrenBuffet) who make untold millions from the stock market. I've heard of day traders taking home over $2 million per annum in profits. I've heard of a dancer making $2,5 million from Momentum trading. What do they have in common? As you can see it's not the system but they operate a style of trading that they are both happy with and excel at. They wouldn't dream of trading any other way. No-one told them to trade this way it just happened this way. Too many traders try to copy the latest hot fad in trading.

Right now that would be day trading. But that style of trading will not suite every-one. To be a successful day trader you have to love the short term up and downs of the market during the day. Being in contact with quotes for hours at a time. Yes, there are a number of traders making very good incomes from day trading, but theres many more who lose their shirts within a couple of months and don't even find out whether day trading is suited to their temperament. For some traders buying a stock and holding on to it for a year as it doubles in price would be torture. Although long term investing can offer fantastic rewards with very little work unless you have the patience and discipline to ride your profits all the way to the top then you'll never succeed with this method.

It's a little like choosing a career. I remember reading a book sometime ago about the world's best managers. And one characteristic the author emphasized with all these top achievers was their LOVE for their chosen careers. Most of them said they couldn't believe they were getting paid to do something they loved so much. It's no different in trading. You will only be a top trader if you trade a system which you simply love to trade. You wouldn't swap that way of trading for anything. And the profits you make, well that's just icing on the cake. How do you find a system you are happy with? You have to work backwards. First work out your objectives!

Ask these questions:

* What annual rate of return do I want?

* Do I want to trade full time, part time, hardly any time?

* Can I handle the stress of day trading and short term trading?

* Do I have the patience for long term trading?

* What kind of personality am I? Do I need lots of action, Do I need to make decisions all the time?

* What trading books have i read and which top traders do I most admire and why? Could you easily copy their style of trading?

What-ever you do don't read about a hot shot day trader and then try to emulate him if day trading is not for you. Strive to find a way of trading you will be comfortable with and aim to become the world's best at this style of trading. For me I like the thought of buying a share at $30 and selling it 9 months later for $130. Sure it doesn't happen all the time. But it only takes one or two of these moves per year to make it a fantastic return.

I am very patient. Not only whilst in a trade but I see absolutely nothing wrong with sitting on the side-lines for months. If the conditions aren't right for me than I will not trade. I love the idea of spending just a few minutes per day checking the charts and the rest of the time is mine to study and write, etc.. For me the big money is in the big moves, not the individual fluctuations. This style of trading will not suite every-one, but the point is after many years of trial and error I have found a system that fits me and I aim to become THE world's best trader with this system.

You must do the same. If you are trading a system that does not fit your personality you can never gain the confidence nor the results to truly make the big profits. If you are a new trader or an unsuccessful one then I suggest you start by asking your-self "What kind of trading suites my personality?" Spend lots of time getting this correct as this is you foundation. Build a strong foundation and your trading system will be strong and stand the test of time. Build a weak foundation and your trading system will crumble along with your money. This is where the majority of traders go wrong. They have no idea which style of trading suites them. They keep buying into the latest software, or listening to the new guru, hoping this will change their trading results.

Most never get to know what successful trading is all about as the average trader lasts SIX months. I believe any trader who can last over TWO years in the market will probably go on to become one of those rare breeds: A Stock Market Winner. Why? Because after two years they start to develop a set of rules that fits them. They start trading a way they are comfortable with. Unfortunately, in their haste to make a ton of money, most traders will never get two years experience before they lose their money and/ortheir interest.

Say it today.

" I will find a system that fits me and I will become THE world's best trader at this ONE style of trading"

Go and get to work. There's a lot of soul searching to be done.

(Excerpt from The 7 Habits of Highly Successful Trader)

Happy Lunar New Year!

2007-02-16T22:27:00.001+08:00

Dear brothers & sisters,

Hereby wishing all of us a very Prosperous, Joyous and Healthy Lunar Pig Year 2007! Cheers!

P.S. : Enjoy the Lion Dance routine sponsored by CoD :)

7 Habits of Highly Successful Traders

2007-02-12T22:05:00.000+08:00

Aqua-Terra ~ Retesting limits, breakout lvl .565 , supp .475

GMG ~ Rubber power, breakout .12 with big volume

GEMS Tv ~ Superbull, res 1.47/1.54 , supp 1.30/1.19 (vested)

1) Take Complete Responsibility:

For the successful trader knows every action he takes, every decision he makes he , and only he, is responsible for that action. You will never meet a successful trader who is looking to blame someone else, or something else for the consequences of his results. It just will not happen. You see, when you accept 100%, no questions asked responsibility for all your actions you close the door to "excuses" behind you. When something goes wrong instead of looking for someone else to shoulder the blame, you will accept responsibility, note it down and vow never to repeat it again.

Simply, you are willing to accept you are going to make mistakes, but more importantly, you are going to learn and never repeat those mistakes. A vital component of any winning trader. Could you imagine Warren Buffet losing a few million $$$'s on as hare trade and then blaming the general conditions of the market. Or blaming his broker for giving him dud advice? no way! Just not going to happen. I will guarantee when top traders takes a loss the first thing they will ask them-selves is "Did I follow my rules?"

If the answer is yes, then they will look at their rules. Is there something that could be changed in their rules to avoid this loss again? Many times the answer will be a re-sounding no. On the other hand, if after asking the question "did I follow my rules?", If the answer is NO. Then some deep self explanation will be called for.

Why did I fail to follow my rules? How can I stop my-self from doing that gain? Am I likely to do that gain, etc... But do you notice the wording of the questions? How can I, Will I, Why did I. IIIIIII Here the trader knows he takes total responsibility for every trade and is seeking re-assurance that he will not break the rules again.

There's an old saying in trading:" If you have to ask you shouldn't be trading" Think about it. If you have a system that you have tested and proven over the long run that it does outperform the market and it is a system that fits you, why will you EVER have to ask for an opinion? What extra will a third party opinion provide?Apart from confusing you and clouding your opinion?

If you are a long term trend follower then why ask a day trader? If you are a value investor then asking a momentum trader will be a total waste of time. What I am saying is, no two people have the same opinion. Why would you believe some-one else over your trading rules?

It's a fact of life, and even more so in trading, most people want to be told what to do rather than acting on their own. Yet this is a major reason most people fail in the markets. Either accept total responsibility for your trading action or do not trade at all. If your number one rule is"to follow your rules " why will you need to ask a guru what they think of your position? If you EVER find your-self wanting to ask a third party about your position do this:

* Close the position out.

* Review your plan and rules.

* Work out why you lack the responsibility to follow that plan

* When you are convinced you don't need a third party opinion start trading again.

How can a trader learn to accept total responsibility? Have a set of rules and realize THE most important point in trading is following those rules. Once you have a set of firmly established rules you will find your-self not having to follow out-side opinion. In fact I go to great lengths not to listen to outside opinion.

Simply because, I know by following my rules I will be on the right side of the market 95% of the time and I will never miss a big move.Those kind of figures are much better than any out-side source can give you.

So from today, learn to take total responsibility for all your trading decisions. Strive to develop and then religiously follow a set of trading rules, knowing it is the importance of following those rules that ultimately determines whether you will win or lose in the long run.

If you ever find your-self thinking, "they did this" or, "the market caused that loss." Change it to: "Did I follow my rules?" If the answer is yes pat your-self on the back as you are on your way to becoming a market winner (one of the minority). If the answer is NO find out why and strive never to repeat this error again.

Accept total and utter responsibility for every trade you take from today and you'll be amazed at how easy trading really is.

(Excerpt from 7 Habits of Highly Successful Traders)

The Science of Chaos: Handling of New Information

2007-02-06T22:56:00.000+08:00

The Science of Chaos has proven that material traditionally neglected by classical science as being random behavior and/or unimportant measurement errors may be the most important causative factors in our search for understanding. It pointedly addresses areas that cannot be navigated by classical concepts. It specifically concentrates on what scientists formerly labeled as Chaos. Chaos is one of those unfortunate misnomers that describes more of what IT IS NOT than what IT IS. Chaos is not random behavior. It is a much higher form of order. Instead of thinking of your usual connotation of the word Chaos, substitute instead the more accurate description: NEW INFORMATION. From now on, every time you hear the word Chaos, translate it in your mind to new information.

The universally most common and most prejudiced way to handle new information is to fit it into old categories. We have done this so often that we consider it either the natural thing to do or, more commonly, the ONLY way to handle it. Upon receiving new information, our usual first approach is: "What is it like? It reminds me of ...." According to psychologists, anytime you feel either overwhelmed or bored it is because you are attempting to fit new information into old categories. (Aha! What are you doing with this information at this moment?) Think about that when you are in the market and feeling either bored or overwhelmed. Our first impulse when handling new incoming information is to organize it in some way. You are in the process of organizing this material that you are reading. Once anything, material or otherwise, is organized, it takes on a life of its own. When it takes on this life, its primary purpose and goal is survival. As this chapter is being written, there is a national outcry to do away with the IRS. What do you think the chances are? Before that happens, there will be blood in the street. For any organization, from the most complex to the very simplest, the first goal is to survive. The four largest money gatherers and distributors in the world are:

1. War.
2. Medicine.
3. Insurance.
4. Religion.

These four institutions control more money than the most powerful country in the world. Why do they enjoy this position? Because they have to do with the survival of our most personal organization--ourselves. The purpose of war is to break things and kill people. The purpose of medicine is to repair those who aren't dead, so that they can fight again. The purpose of insurance is to take care of those left by the dead. The purpose of religion is to take care of those who do die. These institutions have the most money because they all have to do with our personal ultimate survival. The real reason that most traders lose consistently is that they are fitting new information into old, inappropriate categories. If our usual way of handling new information is to fit it into old categories, what is the alternate choice? Let the new information organize itself. When that happens, we have a trance-ending experience of a higher form of order. The question then is: How is this done in trading the markets?

The simplest organization I can think of is a hydrogen atom. It contains one proton made up of three quarks and one electron. It just doesn't get much simpler than that. Trillions of these gaseous atoms are floating around in the air in the room where you are sitting. Their first instinct, just like yours and mine, is to keep their current logic organization intact. They seek to remain hydrogen atoms. In this room, there are also trillions of oxygen atoms. They are much larger and more complex, and they, too, seek to keep their current organization intact. As both of these gases circulate and bounce around the room, they occasionally will come into each other's gravitational field (Figure 2-1). This provides new information for both of them(the gravitational pull of the other). And even though they are infinitesimally small and are inorganic, they make what could only be called an intelligent choice--whether to keep their old organization as independent atoms or to permit the new incoming information to change their organizational structure. They keep their current structure 99.99999 percent of the time. About 0.00001 percent of the time, they let this new information (the gravitational pull of the other atom) reorganize their approach to the world. When that happens, these atoms TRANCE-END their old limitations and become something entirely new, with all new characteristics and a totally different organization. They have become H20-- water. Water has virtually no characteristics that are shared by the two former gases. They were compressible, light as air, invisible to humans and so on. Water is not compressible, is heavier than air, is visible, and exists in different states (solid, liquid, gas). The point here is that there are only two ways of dealing with new information:

1. Massage (distort) it so that it will fit into an old organization.

2. Permit the new incoming information to organize itself into a new, different, and unpredictable organization.

Therein lies the difference between a successful approach to trading and the more common losing approach. Traders who let the new incoming information organize their trading will be in sync with the market and thereby will be winners. Attempting to fit new incoming information (Chaos) into old categories distorts both the information and the trading. The surprise that the Science of Chaos found was that there is an underlying structure to what seems, on the surface, to be random behavior or information.

(Excerpt from New Trading Dimension: How to Profit from Chaos)

A Beautiful World

2007-01-31T21:18:00.000+08:00

Pleasantly surprised to receive a set of beautiful photos from mich. Will be posting it here once in a while, to appreciate each photo in its own rights. It has been the starting of the fifth year with which i first started buying stocks and barely a year where i began to realise the deeper inter-connections and philosophy of the stocks market. People enter the stock market for many reasons, most of which is of coz to try to make a fast buck from it. Sadly the case, not many emerge unscathed from the experience of it all. We feel the exhilaration as well as the anguish and pain. If theres one thing or place where all of our emotions can be found, it would be the stock market. Everyone's experience in it can be wildly different, and it can be exact to the spot, depending on the way u conduct yourself whilst u are in it.

As much as many so-called market experts or analysts have tried to enlighten the masses within, the only way one can truly experience it all is to walk the path. To fall and pick ourselves right back up and carry on the journey. It may be that one could never understand or felt he/she understand the market, and that every additional day is the same as if its your first day in the market. Yes that is just the reason why the market is so attractive to you and me. Perhaps the best thing we can do is approach what we learn from our own experience with an open mind, throw out the rotten stuff, pick ourselves up and proceed on our own journey.

See you on the path!

From Chaos To Cash

2007-01-29T21:35:00.000+08:00

Hyflux ~ Olivia power, supp 2.74/2.67 , volume declines on retracement. (vested)

Hongguo ~ Time for another round? supp 1.07/.965

MAE Engg ~ superbull, supp .19 , res .25

CapitaLand ~ Reversal! Firm supp 6.50 , res 7.25

Wildbey ~ Retracement completes, supp 2.28 , res 3.00 (As requested)

Sin-Oh ~ Rising Up! firm supp 2.68 , res 3.08 (as requested)

My purposes in this chapter are: to introduce you to the basic concepts of Chaos in a relatively non scientific manner, and to point out its applicability to profitable trading and investing. When I first started trading, over 40 years ago, the primary approach to understanding the markets was fundamental analysis. Poring over the company s financial statements, examining the crop reports, and gathering as much "expert" opinion as could be found were the standard procedures. They did not produce predictable or profitable results, but they were the only options if one did not have insider information. Through these past four decades, I have seen the personalities of both the stock market and the commodity markets change many times. Actually, they are in a constant state of flux They form an example of "applied chaos." In the 1970s, very few traders would admit that they used technical analysis. In those days, technical analysts were considered "weirdos." There has now been a complete turnaround.Today, most traders are proud to call themselves technical analysts not because they have been successful, but because they are following the crowd.

The newest science on this planet is the Science of Chaos. In this chapter, we will explore the generalized principles derived from this science and apply them to life and particularly to trading on the stock and commodity markets. As pointed out earlier, the Science of Chaos deals primarily with natural phenomena. One of Mandelbrot's pregnant findings was that the fractal dimensions of rivers are similar to those of commodity and stock markets, which is an indication that the markets are more a function of nature than a process designed by the left hemisphere of the human brain. Our view is that economics fundamentals and technical/mechanical analysis do not draw an accurate map of the market's behavior. The Science of Chaos provides three primary principles for the study of markets. Collectively, these principles govern the behavior of energy. As discussed fully in Robert Fritz's book, The Path of Least Resistance, these principles are:

1. Everything in the universe follows the path of least resistance. The markets are like a river.As they move through each trading minute, they take the path of least resistance. That's whatwe all do; you, me, the markets, everything in nature. It is part of the inherent design of nature. While a river is running downstream, the path of least resistance determines its behavior. Gravity is energizing it as it flows around rocks and along curves in the riverbed. You are reading this sentence at this time because this was the path of least resistance when all your time management factors were examined. You are sitting wherever you are because that location was on your path of least resistance. In the market, you will exit from a losing trade when the pain of losing one more dollar becomes stronger than the pain of saying that you were wrong to be in the trade. The path of least resistance will win again.

2. The path of least resistance is determined by an always underlying and usually unseen structure. The behavior of a river, whether it is calmly flowing downhill or creating rapids, depends on the underlying structure of the riverbed. If the riverbed is deep and wide, the river will flow calmly downhill. If the riverbed is shallow and narrow, the riverbed will create rapids. The behavior of the river can be accurately predicted by examining the underlying riverbed. If you could see the bottom, you could accurately predict the behavior of the river at that point. Many traders who keep repeating their trading behavior produce losses. They often feel powerless and frustrated. They attend seminars, read books and underline appropriate passages, study NLP (Neuro Linguistic Programming), have private sessions with market psychologists, and then find themselves back in the same old losing rut. If that has happened to you, you simply haven't changed your underlying structure. Permanent changes happen only when you alter the riverbed, the underlying structure. As a trader, you always know when you are trying to go against the path of least resistance. Tension immediately builds up in your body and mind. If you are tense about trading, you are not "floating down the river." Once you learn to determine the underlying structure of a market, you can make peace with the behavior of the market and simply "float like abutterfly, sting like a bee."

3. The always underlying and usually unseen structure can be discovered, and it can be altered. You can change the flow of your life and your trading. To do this easily and permanently, you must work with the underlying structure rather than the behavior produced by that underlying structure. The basic concept derived from these three principles is this: you can learn to first recognize the underlying structure that is driving your trading, and then change it so that you can create what you really want from the markets. Structure determines behavior. Structure determines the way anything behaves; bullet, a hurricane, a cab driver, a spouse, a market. The way the pits are structured determines the behavior of the traders in the pits. The structures that have the most influence on your trading results are composed of desires, beliefs, assumptions, and, most of all, your understanding of the underlying structure of the market and yourself. As Robert Fritz notes, "You can't fool Mother Structure ."

(Excerpts from New Trading Dimension: How To Profit from Chaos)

Gorillas and The Market

2007-01-26T22:14:00.000+08:00

Allgreen ~ reversal, supp 1.56 , res 1.75

Federal ~ rangebound, supp .645 , res .72 (as requested)

JEL ~ retracement complete, supp .325

SinoTech ~ breakout confirmed, supp 1.30

Straitsasia ~ support confirmed, .70

A problem that has perplexed zookeepers for many years is why gorillas don't mate incaptivity. It is not because they don't learn about sexual activity; it is because they don't have the proper environment. All animals must have risk to make life worthwhile. If there is no risk, we try to create some because risk and feeling alive are different sides of the same coin. Risk is what makes us alive. Life is not worth living in an environment where there is no risk. In the past, depressions, wars, and conflict gave us a national purpose. We could risk everything for the common good. World War II brought Americans together and created a level of cooperation among us that has not been matched. Our risk was in seeing our enemies, looking them in the eye, and doing something about them. Then the atomic bomb made hand-to-hand combat obsolete. We no longer looked our enemies in the eye, and war became more scientific and less personal.

Even before World War II, most people had the risk of surviving during the Great Depression. Just getting by brought out the best in us. Because we spent most of our time surviving, we were relatively happy while dealing with this risk. Then modernization machinery and the postwar industrial revolution allowed us more leisure time than we were accustomed to having. Today we have to spend that leisure time, and we have lost the opportunity to struggle. Most people fill the gap with TV, but you and I have the opportunity to fill this deep need by being in the market. First, we must understand our need and how the market interfaces with that need. Chaos provides us with unique tools. Chaos is the background from which we mine the material needed to make us feel good about ourselves, to learn about ourselves, and to progress toward realizing our own personal potential. We are forced to make choices, to abide by the results, and to learn from daily opportunities. Risk is a turn-on in life. We are not interested in haphazard risk. We are talking about the risk that produces research, allowing us to understand the markets better and to extract profits from our knowledge and understanding.

Your beliefs about the market create your reality of the market. Beliefs are assumptions about the nature of reality, and because you create what you believe in, you will have many "proofs"that the market operates the way you think it does. For instance, a trader who believes that the market is abundant and generous will act in such a way that he or she experiences abundance; a person who believes that no one can make money from the markets will not receive money from the market. Each trader will have many experiences to prove that his or her personal belief about the market is really a fact about the market. You can change what you believe and thus change your experiences in trading. In this book, we are going to explore in detail how to trade each of the five dimensions. We will then put them all together for a profitable approach to decision making in the markets.

The biggest risk you can ever take is not betting on yourself.

We have explored in this chapter the reason most traders lose, and we have introduced the idea that the new Science of Chaos can improve our market performance, allowing us to be consistent winners in the markets and in life. We also took a quick look at what I refer to as the real Holy Grail. In the next chapter, we will examine the Science of Chaos from a practical everyday trading orientation. We will eliminate most of the complicated math and concentrate on profitable application of the theory. A number of books contain the mathematical underpinning of the Science of Chaos and Complexity, but few have successfully applied the theory to the investing and trading markets. I am proud to have you join me in this pioneering effort. The best is yet to come. Let me again welcome you to the wonderful world of trading and investing, where anything is possible if you understand what is happening in both the market and yourself Permit me to share with you other reasons I love trading the markets. It is the last bastion of free enterprise where you are rewarded generously for doing the easy, appropriate thing.

You win or lose purely on your own decisions. If at the end of today, I have lost, THERE IS NO ONE TO BLAME. If, on the other hand, I win today, I DON'T HAVE TO SAY THANK YOU TO ANYONE. I am not obligated to anyone or anything. I do not have to be politically correct. The reward is there for the taking; the only question is: Are you conscious enough to take it? My wife once wrote an article describing the market experience as "sliding down the razor blade of life." One young man whom we taught to trade successfully wrote, "It is the most fun I have ever had . . . with my clothes on." Your scan be a life of freedom and fun; the responsibility for that freedom lies solely within you. And now, let's take a closer look at Chaos, which you will find to be another word for FREEDOM.

(Excerpt from New Trading Dimension: How to Profit from Chaos.)

Einstein and Winning

2007-01-25T21:20:00.000+08:00

If you follow the history of science, you will find nothing that predicted the introduction of the theory of relativity. Until the twentieth century, classical science dealt with four basic elements that were considered separate from each other: mass, energy, space, and time. Einstein, who seemingly came out of left field, introduced his theory of relativity, which basically states that space and time are really the same thing. He also pointed out that matter and energy can be converted from one state to the other and therefore are not different. He often stated that there are really only two components of the universe:

1. Nothingness.

2. Condensed nothingness, which we call form or things.

This led to undreamed-of innovations such as atomic energy and changed science's view of the world forever. About the only thing that Einstein left us as a constant was the speed of light. The next revolutionary development in modern science, quantum mechanics, took away even that constant.

After the discovery of subatomic particles, our conceptually logical world went haywire. Subatomic particles do not "behave" as they should, or at least the way we think they should. Our most basic assumptions came into doubt. A number of things apparently traveled much faster than the speed of light. In fact, there was evidence that some things travel so incredibly fast that they could be in two places at once. That was not supposed to happen, according to classical science. In 1964, John Stuart Bell, a brilliant scientist, introduced a notion he called the non locality of causes. This cast doubt on the entire theory of cause and effect. Bell said individual causes could not be isolated. This is quite a serious concept.

Most of us tend to run our lives and our trading with cause-and-effect assumptions such as "Why did I catch that cold?" or, more particularly, "Why did I lose on that trade?" If, as Bell maintains, this is not the way the world really works, we might have our ladder of learning leaning against the wrong building. Thousands of experiments offer positive proof that Bell's theorem is indeed a more accurate description of how things really work. Bell maintains that everything in the universe is connected. You are a part of me and vice versa; whereas Aristotle maintained that everything had its own discrete boundaries and could be located and categorized. The next science-changing innovator was another brilliant American scientist, David Bohm. Bohm was caught up in the terrible McCarthy hearings in the 1950s and chose not to live in a country that would allow such travesty of human justice. He moved to England and was a research professor at the University of London. Bohm went even further than Bell, maintaining that not only is everything in the Universe connected but everything is actually the same thing. Everything comes from the same shimmering quantum soup. In the market, we are looking at a very non-Aristotelian world in which there are no discrete categories, no actual nouns, and no real long-lasting stability. In this new view of the world, everything is constantly changing and those very beautiful smooth shapes of Euclidean geometry are themselves aberrations and not the norm. The materials that scientists through the centuries had ignored as "random" variations are actually the cornerstones of reality. As mentioned before, the two areas where classical science makes little headway are: turbulence and living systems. From the shoulders of relativity and quantum mechanics came a new approach whose goals were to study turbulence, living systems, and nonlinear behavior. The techniques were impossible to deal with mathematically before the advent of very powerful computers, but the questions had been asked centuries before.

Before Columbus landed in America, the fifteenth-century mathematicians were asking questions about Chaos. Their theoretical questions concerned the various levels of Dimensionality. For example, a point has no dimensions, a line has one dimension, a plane has two, and a solid has three. They understood that even a crooked line has only one dimension as long as it does not cross itself and create a plane. Suppose then that a very crooked line is placed on top of a rectangle (plane) and moves over the surface of that plane but never crosses itself. It is so crooked that it covers up 50 percent of the plane as it moves off to the other side. The mathematicians' question was, quite simply: What is the dimension of that line? It can't be one dimension because it covers half the plane (which is two dimensions), and it can't be two dimensions because it doesn't cover the entire plane. (Stay with me here because this concept has changed our world and will change it even more so in the future.) In addition to this concept of higher dimensions, two other scientific developments have altered our world view. One is the concept of cybernetics, which came from a Greek word meaning steersman--the man who holds a boat's rudder, and who can, with a small amount of force, move a much larger force (the boat). Cybernetics does not follow Newton's law of motion, which says that for every action there is an equal and opposite reaction. A small action on the rudder produces much more than an equal reaction. Cybernetics came out of information theory, which was developed during World War II in an effort to get more communication through the existing cable that crossed the Atlantic Ocean between America and England. Basically, information theory points out that there are at least five parts to any communication: (1) a source, (2) an encoder, (3) a message, (4) a decoder,and (5) a receiver. The important point here is that the decoder comes from and is attached to the receiver whereas the encoder comes from and is attached to the source. Any qualitative difference between the source and the receiver will always be distortion between the intended message and the received message.

It is not an accident that we misunderstand each other; it is a miracle that we ever do. Our personal decoder is the home of all our prejudices and preferences. That is where our categories (belief systems) and desires live and work. Our decoder is the filter that distorts incoming messages that do not fit into our existing beliefs (categories). Another scientific breakthrough since the 1950s was the discovery of the hologram. The insight gained here is that information can be stored in ways yet to be discovered, and unbelievably large amounts of information can be stored in extremely tiny spaces. Before you were born, your entire body including the size of your muscles, the number of hairs on your head, the shape and size of your teeth, the color of your eyes, the number of cells in your brain, how you will age, and, barring accidents, when you will die were all stored in your RNA/DNA in a space so small it cannot be seen with the naked eye. If you take a holographic 8 x 10-inch film and cut off one corner a slice smaller than l/l6 of an inch, it will still contain the same details as the 8 x 10-inch picture. Information theory, cybernetics, and holographic theory do not support the Aristotelian view of the world. When we say "Our world is changing," what we really mean is that we are getting a different view of it. And this is what the approach in this book is about: getting a different, more accurate view of what the market actually is and how it operates. We do this by examining five dimensions of the market. These dimensions could be compared to looking through five different windows, each of which adds to the total picture. These dimensions are:

1. The fractal (phase space).

2. Momentum (phase energy).

3. Acceleration/Deceleration (phase force).

4. Zone (phase energy/force combination).

5. Balance line (strange attractors).

Each of these different dimensions gives unique insight into the underlying structure of the market and its behavior. The recent advent of extremely powerful computers has now permitted us to get more specific insights into this world view that we now label as the Science of Chaos. If you knew everything there is to know about the Science of Chaos and you decided to give it a name that would confuse the most people, you probably would choose the name Chaos. Chaos is not craziness and it does not mean randomness; rather, it is an insight into a much higher form of order. (We will examine this new science, and how it can improve our trading, in the next chapter.)

WHY GORILLAS DON'T PROCREATE IN A CONTROLLED ARTIFICIAL SETTING AND WHAT THAT HAS TO DO WITH THE MARKET.

Living Life in the Fast Lane

2007-01-22T19:34:00.000+08:00

Now if u look carefully, u can see sis ateo's husband's camera and sis ateo next to him.......... kidding! hehe

Now THATS one hugh Harley!

Welcome to the Hotel California...... err... Vegas..

In God We Trust.. In Liberty We Stand!!

Golden Eiffel.

Swimming on Our Own

2007-01-18T21:21:00.000+08:00

Ausgroup ~ stored energy supp .535 , breakout .575

Banjoo ~ Superman, breakout lvl .14

HL Asia ~ bullish engulf with volume, supp 1.93 , res 2.06

Hongguo ~ ascending star, breakout lvl .965 (vested)

SPH ~ consolidation, supp 4.40 , res 4.56 (vested)

Wilmar ~ flag, supp 2.50 , res 3.00

Our own personal ocean of logic started approximately 2,500 years ago, when a philosophical war was going on between two opposite camps represented on one side by Aristotle and on the other by Heraclitus. Aristotle basically seduced the world by saying that if you don't know something, you should go to people who know more than you do, and ask them. That advice sounds quite reasonable, and it has been accepted by much of the earth's population for two and a half millennia. Acceptance does not necessarily make it true. Remember that the civilized world functioned adequately for hundreds of years while believing that the world was flat. Businesses and mapmakers flourished. But then Galileo and a handful of others looked through a telescope and saw round planets in orbits in the heavens.

They knew that the flat-earth paradigm was wrong, but it took close to 200 years and much suffering on their part before the reality of a round earth was accepted. The Aristotelian/Heraclitian dispute was much more insidious than the conflict involved in understanding the heavens. Because Aristotle won this intellectual war, your life is as it is today. Had Heraclitus won back then, we would have a completely different civilization. Aristotle influences almost every thought you have and each of your analyses of the markets. Why do you read the Wall Street Journalor listen to FNN or call your broker or the trading floor? Because you think THEY know more about the market than you do; after all, "They are in the business."

Most likely, they don't!

I do not know any broker who would be a broker if he or she could trade profitably. The designation of broker probably means that you are the brokee. Of the newsletter writers and market commentators you know, how many have made money in the markets? I have never met an economics professor who made a significant amount of money trading.

Aristotle believed in a reductionist approach: if you break anything down into its smallest primary parts, you can understand how that mechanism works. Thus began our search for the smallest part of the universe, which was thought to be the atom. However, with more sophisticated tools, we developed an entirely new science based on subatomic particles, and this subatomic research has totally changed our basic ideas about the universe. It is also interesting to note that all the subatomic particles that have been discovered were named long before they were discovered.

The old questions return: Do we believe what we see? Or, do we see what we believe? Aristotelian philosophy has influenced our legal system (precedence), our educational system (the teacher-student relationship: the student is dumb and the teacher is smart), medicine (double-blind studies), and science (reliability and validity). Following this path of reductionism has produced the concepts of cause and effect, "laws" of motion, "conservation" of energy, and entropy. The latest findings of modern science have proven all of these assumptions and concepts false. Aristotle's philosophical counterpart, Heraclitus, felt that the universe was in constant flux, and stability and homeostasis were not the norm.

Probably his most famous saying was: "You can't step in the same river twice," meaning that when you put your foot in and take it out and immediately place it back into the water, not only has the river changed, your foot has changed also. Heraclitus's most famous student, Clayitus, went even further. He said: "You can't step in the same river once": you and the river are changing during the process of putting your foot in. Science in the twentieth century will be remembered for three very basic innovations that completely changed our way of viewing the world:

1. Relativity.

2. Quantum mechanics.

3. The Science of Chaos, which includes information theory, cybernetics, holography,nonlinear dynamics, and fractal geometry.

Speculation and Life

2007-01-15T22:55:00.000+08:00

Here is the key. Trading is a game that you set up and agree to. You only have two choices about how you will get to where you are going. The first is an unconscious method; your mind will create your reality from your pictures of the past. And you know that it is most ready and willing to do that. In fact, that is one of the main functions of your brain's left hemisphere. But this part of your brain can only duplicate earlier situations--IT CANNOT CREATE. In fact, your mind cannot accept the notion of creation or the notion of disappearance. Your only other option is to become conscious of your notions. A notion is another word for noticing. When you notice something (or get a notion), you give it your attention. When you begin to notice how you are noticing, you fall into AWARENESS. When you start becoming aware, you will be out there on the razor's edge of choice and always willing to make one. You will become aware that what you see on your brain screen is much more important than what you see on the monitor screen. The market can become your own tree to sit under until you reach enlightenment. Enlightenment in this case is seeing the market for what it really is. So let's repeat:

The market is nothing but agreement on price and disagreement on value. No trade is made until there is disagreement on value and agreement on price.

No market moves until there is new incoming information (Chaos). Most traders disagree with the purpose and function of the market and thus lose. Picking tops and bottoms is disagreeing with the market. And because we are all stubborn to one degree or another, we make following the trend of the market, which should be the easiest thing in the world, one of the most difficult tasks in speculating. Most traders feel that what they need is some new "genius" who can create a trading system or indicator that will make sense of the "craziness" of the market. A muddle of conflicting indicators united by the force of greed is the worst possible instrument for trading the market. Irrevocable commitment to this kind of indicator is financial suicide. We do not need a new indicator or strategy. We need a new experience--a new feeling of what it is to come from the right hemisphere and intuitively understand the market. One must take care not to confuse the image (chart) with fact, which would be like climbing up the sign post instead of following the road, or eating the menu rather than the meal.

Cosco ~ sailing away, supp 2.49

Ho Bee ~ breaking out mode, supp 1.37 , res 1.50

Enviro-hub ~ breakout! supp .70/.65

Sino-env ~ consolidation mode, supp 2.49 , breakout lvl 2.80

Sunshine ~ breakout! supp .375/.33

Kepcorp ~ reversal, supp 16.7 , res 18.10

From Losing to Winning

2007-01-10T21:46:00.000+08:00

This book is basically for traders who can't win for losing and for winning traders who want to improve their efficiency at winning. It is not for those individuals who have no interest in working through their power trips in relation to themselves, other people, and the market. If you are not willing to allow sweeping changes to occur in your life as a result of this material, you should not attempt the techniques described here in. Every trader is responsible for his or her own behavior. Part of maturation is the ability to draw the "honesty cards" about oneself to the forefront of awareness, in order to decide on a course of action. The consequences of immature judgment or of toying with trading can include psychosis, aggravation of neuroses, acceleration of disease processes, and suicide. On the other side, an awakening into certain states of consciousness can bestow gifts of such value that they are beyond price--and I do not mean only monetary profits.

The markets themselves are the most accurate and brilliant psychological mirrors in the world today. Trading can be the most naked and efficient psychotherapeutic growth program in which one could engage, if approached with an appropriate attitude. Here is a statement that many traders will hoot at: Making profits is not the most important reason for trading. Read well--I did not say unimportant, I said not the most important. To us, the primary reason for trading is the most important reason for doing anything: TO FIND OUT WHO YOU ARE.

That perspective makes all the difference. The intention of this book is not to please. Its purpose is to tilt you from the limited possibilities for experience that you now have. The material is offered to those who are ready to begin an awakening process--those who know at the deepest level of their awareness that they are ready for a change. Your desire to change your unfulfilling life and unsuccessful trading patterns into a state of consciousness is vital to your success. In this chapter, I want to deliver a truly believable message from a true believer in your trading and investing success. As you know, there are basically two kinds of traders: the successful ones, and everyone else. Michelangelo once pointed out that there are two ways of creating a statue. The first way is to create a statue from a piece of material.

The second and more masterful way is to see that the statue is already inside the material, and sculpting is merely a process of getting rid of the material that does not belong there. Another equally famous philosopher pointed out that there are two ways of becoming enlightened: (1) by building on your good qualities and (2) by eliminating what doesn't belong. Robert Frost wrote,"Two roads diverged in a wood,and I took the one less traveled by, and that has made all the difference." In this book, we are going to take a journey on a road less traveled by eliminating much that isn't true about trading. We are going to unravel some tangled ideas and win for a change. I want to share with you our truth about trading. Let me hasten to add that I am not much enamored by the concept of TRUTH. Actually I have very little interest in The TRUTH. I am much more interested in lies that work than I am in The TRUTH. The reason is: Truth (with a capital T) doesn't last. In fact, it seems to change with each generation. Truth once was that the world was flat. All of the intelligent people in the world agreed on that "fact." Mapmakers made a good living by believing that Truth.

Truth once was that Zeus ruled the world from a mountaintop in Greece. Truth once was that bleeding was a cure for many ills; check with our first President about that Truth. It cost him his life. And let me state here that some of the Truth you know about the market today is costing you your financial life. Let's look at the Truth of the current situation. If you are attempting to categorize this material, you would most likely classify it as an unpopular trading guide because it contradicts what I call the popular guides to trading success. Any popular guide to trading will tell you exactly what you want to hear. That's why the guides are popular. They have titles like BigBucks NoRisk! They are worth their selling price because the publisher always promises:

An easy to understand, proven system for turning little or no initial investment capital into a fortune, in virtually no time whatsoever.

Wouldn't it be great if we really could make a fortune like this without working? Well, we can't. These things could never be right. Be real; if we are raking in all that money, who is going to supply the losers? Who is going to lose all that money to us? And if it really works that well, why doesn't the publisher of BigBucks NoRisk take its publishing budget and put the money to work in the markets? There, "with little effort and absolutely no risk," it can make vastly more money than by publishing a competitive book that has skinny profit margins. The only sure thing about popular guides is that you are going to lose your money following their advice. If the popular guides tell you what you want to hear (so they can sell you books) and we tell you what is actually true about trading, then this must be an unpopular guide to trading.

The Truth is that a limited number of talented, rational people who know what they are doing can beat the market consistently. This is not just a game, it is life. And one of the primary purposes of the business of speculation is to make money. These are turbulent times. Past generations were not as turbulent. Remember when real estate was a fortune-building safe haven? Bonds were safe as the government. Savings and Loans were safe depositories, and heaven knows there could never be a problem with Insurance companies. If you chose to hold cash, it could never make you poor. As a hardworking trader/investor, you probably know about seminars, tutorials, books, systems, hotlines, and soon, that are supposedly designed to give you an edge in the markets. Maybe you have even attended a few, and perhaps you feel guilty about the ones you did not attend.

Tell me, have you ever known anyone and I mean anyone who has gone to a weekend seminar as a losing trader and, from something learned there, has become a consistent winner? I have spoken to over 25,000 traders, and I have yet to find the first one. Nor did I~o from losing to winning by attending workshops. Does that mean that they are useless or not worth the money? No, not at all. Workshops are great places for getting ideas but are simply no good at changing behavior, which is the topic of our discussion here. If you change your beliefs, you will change your results. Let me ask you two questions. (1) If I gave you $10,000 and a ticket to Las Vegas and asked you to go there and lose that $10,000, do you honestly feel that you could do that for me? (2) What if I gave you the same money and ticket and asked you to go there and double my money?

These are quite serious questions. If you really understand why you answered both of them the way you did, you are very close to understanding why you are not a more consistent winner. Let me throw a different concept at you. Whichever way you answered the questions and whatever you did when you got to Las Vegas, you would be successful. In answer to the first question, you would be a successful loser because you did exactly what you expected to do. You were successful at losing. You were a winner at losing, and there is no difference in being a winner at losing and a winner at winning. You get whatever you set up for yourself. Trading is a self-discovery process and a very personal experience. To make money in the markets consistently, you must know what your job is. Let me tell you the most important words you will ever hear about speculation and trading:

Speculators get paid for buying what nobody wants when nobody wants it and selling what everybody wants when everybody wants it.

While we are at it, here are a few things that speculators never get paid for: fundamental analysis, technical analysis, overbought/oversold analysis, Elliott Wave analysis, Gann analysis, cycle analysis, pattern analysis, oscillators, relative strength, econometric models, seasonal analysis, profile analysis, value analysis, sunspots, star positions, and a dozen other vogues, fads, and fantasies, except to the extent that they happen, by luck or design, to cause their proponent to demand the supply or supply the demand.

(Excerpts from New Trading Dimension: How to Profit from Chaos)

Relax your Goals

2007-01-04T21:30:00.000+08:00

HL Asia ~ breakout! supp 1.69/.66 , res 1.82

Hiap Hoe ~ Superbull, supp .12 , professional trade on retracement back near .12

SPH ~ breakout! res 4.52 , supp 4.38 (vested)

Despite what all the "do it better" gurus are saying, we diminish the present any time we set goals. In the market, things sometimes work out the way we want them to, but sometimes they don't. We don't enjoy our preparation for trading the market if we are worried about losing. We don't enjoy the miracle of our children's growth if we worry about how they will turn out.We don't enjoy maturing if we are worrying about what malady will take us from this life. We lose the freedom to soar that comes from enjoying the vast riches that life and the market are offering us in the here and now.

In trading, if you set your heart on a certain trade result, you enter into a state of rigidity. On the other hand, if you set your heart free, you enter a state of flow. The question then is: How can you trade without setting goals? The answer is: Set as many goals as you want. Then do the necessary preparation, and work to bring that goal to fruition. When you are satisfied that you have done the most appropriate trade for that moment, LET GO OF THE OUTCOME.

Years ago, I traded with a very bright trader who was decades past the normal retirement age. After observing my trading for a while, he said, "Bill, if you were a farmer, you would go broke on your first crop." When I asked him why, he replied, "If you were a farmer and farmed like you trade, you would plant corn and then come back everyday and dig up the seeds to see how they were doing. Once you decide and put ona trade, let it grow, mature, and ripen. Don't keep digging up the seeds." He was exactly right. I learned a great deal from that mature trader. One of the most important lessons I can teach you is how to monitor your trading minute-by-minute in the market. It is really quite simple. When you look at the current chart and you know your present positions, ask yourself this simple question:

Do I care which way the market moves?

If you care, you are addicted. If you honestly don't care, you are trading well and you want what the market wants. Any time you care, you are wanting what you want-not what the market wants. The market is neutral. It doesn't know or even care what you want. As traders, we are simply not capable of knowing what the market is going to do, nor can we see the grand possibilities that the market will offer us tomorrow. Sometimes, losses can be turned into great assets if we learn from our experience. In that situation, we gain either profits or learning, and both can be wins.

Tomorrow's market is not just unknown, it is unknowable. Traders are simply not capable of knowing what the market is going to do or what grand possibilities the market will offer tomorrow. Probably the most inappropriate question we can ask at the end of a trading day is: "Did we make money today?" From our point of view, that is basically irrelevant. The only appropriate question at the end of a trading day is: "Were we in tune with the market?" There will be days when you will be in tune with the market and lose money, but if you stay in tune, the market will bless you greatly.

There is no much thing as a bad trader.There is only a well trained or a badly trained trader.

Grounded Versus Ungrounded Assessments

2006-12-29T22:41:00.000+08:00

All of our decisions are based on our personal assessments of what is going on, whether we are traders in the market or shoppers in the supermarket. A grounded assessment is an assessment that can be agreed on by a hypothetical jury of our peers. Anything else is an ungrounded assessment. For example, you see your friend is wearing a shirt. The statement "He has on a shirt" is a grounded assessment. We all agree on that fact (provided, of course, that he actually does have on a shirt). If you say, "He has on a nice shirt," you have rocketed yourself into the land of ungroundedness where truth cannot be determined by observation. Almost everything that we say or hear about the market falls into the ungrounded world. Ungrounded assessments create never-neverland market analyses. Here are some examples of ungrounded market assessments.

* The market is topping out.

* The market is oversold (or overbought).

* We are in a third wave.

* This is a short covering rally.

* One should never take more than a $500 loss.

* Never risk over 2 percent of your total equity on one trade.

* The seasonal activity will take this market higher.

All of these statements are totally ungrounded assessments and do not, in any accurate way, describe the market or market behavior. Ungrounded assessments create chronic losers. If you are a losing trader, I can assure you that one of the principal causes is that you are making decisions based on ungrounded assessments. Grounded assessments are real, verifiable, unambiguous, and accurate, and they come directly from the market itself. The material and indicators in Chapters Three through Ten include only grounded market generated assessments. Basically, all of our observations (assessments) go through a part of the brain(the reticular activating system, or RAS), which acts as an analyzer and gives us only the information that passes our filters (what we want to hear). In no way does it give us a true take on reality or on what is really out there. A camera does not have an RAS to filter its incoming information. It just records what is present in a certain vibratory octave. It will take a picture of a yellow vehicle with black writing on it, and that is what you get. We, however, identify the yellow vehicle as a school bus and immediately all of our prejudices and preconceived notions jump to the forefront rather than seeing what is actually there. We think about slowing down, not passing, and watching carefully for small children.

Our actions are not based on grounded assessments but on our history(belief system) with that particular concept. It is said that generals always fight the previous war rather than the one they are in. We traders generally trade our last mistake rather than what is happening in the current market. In other words, we set up our own prejudices based on past experiences, and any incoming information will be filtered to make sure that it does not contradict our belief systems. If reality does conflict with our belief systems, we will deny reality and distort incoming information to keep our unquestioned beliefs intact.

No wonder we perform so miserably in the market even though we may have been extremely successful in other professions or businesses. In the market, you either confront reality or you create losses. If we want to climb off this ladder to distress, we must confront what is really going on in the market rather than our ideas about it. I will briefly review here what is going on. I refer the reader to my previous book for a more complete description. The primary purpose of the market is to find immediately the exact price where there is an:

Equal disagreement on value and an agreement on price

The last time you bought a car, you and the dealer or person you bought it from had to agree on a price. Before the price could be fixed, you had to negotiate a disagreement on value. Without a disagreement on value, there is no market. You wanted the car more than you wanted the money you were ready to spend to purchase it. The person you bought it from wanted your money more than the car. All free market transactions must have these two elements. When they are present, you have created a commodity or stock market. When someone tells you the market is "oversold," it simply means that the market went lower than the person thought it would. It says nothing about the market. I respect the analysts' right to use this or any other term, but there just isn't any such condition as oversold or overbought. The primary function of any market or exchange is to make sure that this condition does not exist, even for a second. Whenever you read that there is a 60 percent bullishness in bonds, it only means all the bears haven't been surveyed. If the market were 50.01 percent bullish, the price would have already gone up. Here is the truest statement I can make about the market:

The market is where it is because that is where it is supposed to be, and it is supposed to be there because that is where it is.

Think about this for a moment. Once you grasp this concept, you will:

1. Know more about the market than 90 percent of those who have money invested in it.

2. You will have started down a yellow brick road to more profits.

The market is where it is because, at this point in time, this is its fair value simply because you have an equal number of contracts buying and selling at that price. Don't get me wrong: I'm not trying to convince you of anything. I don't have even a thimbleful of missionary bloodin my veins. If you really believe there is such a thing as bullish/bearish consensus and/oroversold/overbought conditions, be my guest. Would you also like a spare tooth to put under your pillow tonight for the tooth fairy? It is time to get serious or get ripped off. "The marketis . . ." definition above is a true, brief, and accurate description of what is happening everytime a commodity or a share of stock is sold or bought. We don't need all the millions of ungrounded assessments (opinions) floating around. In our private tutorials, we strongly suggest that there is no need to seek out any source for information other than the market-generated information. Reading the Wall Street Journal, Barron's, or Investors Daily; subscribing to advisers' newsletters or hotlines; or tuning in to financial TV or radio is more destructive to your financial health than smoking is destructive to your physical health.

(Excerpt from New Trading Dimension: How to Profit from Chaos in Stocks)

China Kangda ~ no clear sign of reversal, supp .45 , res .485/.53

NB: Tried as i might, i couldnt post my chart for Techoil&Gas. I will verbally describe the chart here instead: Techoil 's chart shows retracement from breakout of .75 region , as long as price can maintain above this level, good chance of retesting res at .815 .

Rising Above the Clouds of Doubt

2006-12-26T22:58:00.000+08:00

To say that trading is simple, easy, and profitable is incredulous to most traders and absolutely absurd to others. Almost all traders experience a great deal of doubt. In this section, we are going to look at ways to rise above the clouds of doubt. This will ultimately happen only after enough experience in using my trading techniques to prove their overall profitability.

The key to rising above doubt is to again realize what game we are playing. The game is trading our own belief systems. If we want to change our results, we must change our beliefs. Beliefs are what we "know" to be true. We almost never question our deep beliefs, but that is exactly what a losing trader must do: question personal beliefs not only about the market but, even more, about themselves.

Very few traders know why they trade, much less how they trade. We all can spout our superficial reasons: to make money fast, to enjoy competing with other traders, to gain the prestige of being able to say "I am a trader," and so on. In your last trade, did you lose because you couldn't see the market going the other way, or because of a deep, unexamined belief that you shouldn't get rich that easily? If the latter, it's time to free yourself from some old beliefs.

Hongguo ~ As posted previously, conform to expectation. Target res .97

Hengxin ~ Reversal, supp .57 , res .755

Mapletree Log ~ Retracement from breakout, supp 1.06 , res 1.18

Rotary ~ Uncharted territory, supp .66/.60/.525

Your next task is to release, get rid of, or, at the very least, become aware of these beliefs.The best method is to examine the difference between process and content. Classical sciences have always tended to deal with content. "My head, it hurts" is an example of how the classical sciences divide everything into three parts:

1. The observer.

2. The thing being observed.

3. The process of observing.

Modern sciences (relativity, quantum physics, and the Science of Chaos) do not create or condone this separation. A quantum scientist would report, "I am in the process of headaching myself "- much more accurate description. Modern science does not believe there is any such thing as nouns. Everything is energy and all energy is process. Buck minster Fuller titled his autobiography I Am A Verb. This distinction between process and content will become very important to our proficiency at dealing with the market. In general, we are educated to be goal-directed, making what isn't more important than what is. We make lists of our goals, plan them out, and then neglect the present and live, in our head, in the future. The problem with living in the land of goals rather than the land of now is that when we center our attention on the future, we cannot concentrate on or even accurately observe what is happening now. We can't dance well while thinking about how we are dancing.

We can't trade well when we're planning what we are going to do (trade) tomorrow. Living in the now is a necessity to good trading. Living in the now is another way of saying: Pay attention to process rather than future goals or desires. One way of living in the now is to make sure that all our observations (or as many as possible) are based on "grounded versus ungrounded" assessments. Again, this is not an economic, fundamental, technical, or mechanical approach. It is a behavioral approach using only market-generated information.

(Excerpts from book: New Trading Dimension, How to Profit from Chaos in Stocks)

Merry Christmas!

2006-12-25T02:11:00.000+08:00

How to Dance

2006-12-21T22:15:00.000+08:00

Please take note that these are not so-called 'quickpicks' or stock picks or any kind. I certainly do not mean it to be so. These are just analysis of a stock's current outlook. Interesting ones i would leave comments beside them. And some are requested by our friends, not deliberately pick by me. I have mentioned that i would try not to chart stocks that i am currently holding, in the name of neutrality, however there are times when either they are too interesting, to not chart them or that they are requested. Below is hongguo which i am holding and i find too interesting not to chart it for all of us as case study.

Hongguo ~ within uptrend channel, supp .815 , target res .97

Genting Int ~ Superbull, penetrated upper bollinger band with increasing volume.

Suntec Reit ~ retracement, supp 1.64 , res 1.78

KS Energy ~ kiasu mode, rangebound btw 2.47 to 2.59

AsiaPharm ~ Ultrabull, res .65/.725

Dancing with the market
is moving with the flow of the market up,
down, or sideways
with a feeling of harmony,
trust, gratitude, and yes, even love.

To really dance well and enjoy the process of dancing, you must let yourself be moved by the music rather than follow any pre planned agenda. In other words, the dance floor (market) must become a friendly place. Friendly here means comfort, relaxed enjoyment, and a place where you feel friendly.

Remember Einstein's most important question: Is the universe a friendly place? I want to assure you, based on not only my personal experience but the experience of over 700 people whom I have privately trained to become independent speculators, the market is a friendly place. Any unfriendliness always comes from us, not from the market.

We often hear phrases like "The market stopped me out." The market never in all its history stopped any trader out. We all do it to ourselves. Win or lose, it is always our own fault. That is because no one trades the market; we all trade our own personal belief system. Remember the Jimmy Buffett song "Margaritaville," where the singer concludes that no one should blame a woman; his problem is his own damned fault. Well, he was right.Those of you who have worked with me and are familiar with my work know that what I say comes largely from my own experience. I have had much help and advice from other traders and from researchers using modern technical tools, but the actual implementation of this research is a very personal matter. We are going to look closely at how we create our own internal struggle, which goes on whether we are winning or losing. My 40 years of research and trading experience have produced what I think is the most successful approach to trading available today.

Recently, I was offered a seven-figure amount if I did NOT show this materialto other traders. That money is a mere pittance compared to what is possible using these techniques. I have come a long way on this issue of dancing with the market, and I am amazed at how obvious it all becomes once a person starts experiencing the reality of this approach to trading.

I am reminded of an ancient Buddhist saying: "The road is smooth; why do you throw rocks before you?"We all do this in the market. All of us, at times, throw rocks before us, andit is difficult to dance on rocks and come out pain-free. So let's begin by clearing the debris and making way for a more profitable, peaceful, joyful, and abundant trading life.

(Excerpts from New Trading Dimension : How To Profit in Chaos)

Market Versus Me or Market And Me

2006-12-18T22:37:00.000+08:00

Gems Tv ~ Flag completion, supp 1.36 , target res 1.46

CapitalRetail ~ hanging by the tread, supp 1.74

CapitaLand ~ Positive divergence with rsi, supp 5.90 , target resistance 6.40. Possible warrant play with more leverage. More risk as well.

The average trader feels that trading the markets is a highly stressful occupation. Below are some actual questions we have received from active traders:

* How can I both enjoy trading and make profits trading the markets?

* Why am I so addicted to doing this when there are so many disappointments (losses)?

* How can I keep serenity inside myself and my loved ones while living in this turbulent world of the markets?

* How can I stop worrying so much in such a threatening atmosphere?

* Why do so many traders/investors lose money so consistently?

* How can I distinguish among all the hucksters who are hawking their wares as being theanswer, when none of them seems to last even a couple of years?

* Why does my broker give me such bad advice?

* Why do all the newsletters I read boast of such enviable track records, but when I start trading them, they lose money?

Even when we are winning, there is an under current of fear that the next trade will probably be a loser. We exhaust ourselves as we try to control the present and the future while our minds futilely search for ways to recreate the past. We yearn to trade while being more relaxed, calmer, more in control, and excited about trading. To most traders, the possibility of that kind of life seems like a long-lost dream. The joy of trading is gone, and our life is filled with stress. We have tried all the hotlines, newsletters, psycho babble, books, and private sessions. Our love ofthe market is wearing thin. Something is very wrong. But what is it? We often blame government action, bad information, surprising crop and corporate reports, and other vagaries of the market. But these are not the real causes of our distress and our constant struggle with the market. The answer lies at a deeper level. After much research and personal experience, I have come to the conclusion that those who approach trading with serenity rather than struggle-those who have looked beyond the confusion and mastered the art of "dancing with the market" are consistent winners.

(Excerpts from New Trading Dimension : How To Profit from Chaos)

Dancing With Market

2006-12-13T22:08:00.000+08:00

Ouhua ~ rock-bottomed, supp .44 , res .48

Semb Kimtrans ~ Superbull, supp .69/.65

China Sky ~ fallen Angel, supp 100MA 1.16, res 1.34

SinoTech ~ uptrend intact, supp 1.17 , res 1.30

Wilmar ~ hit support, supp 1.69 , res 1.30

FJBen ~ retracement from breakout, supp .62/.57

Most guys had this happen in high school. You ask a pretty girl to go to a dance and she accepts. Now you are in trouble! You fear you will make a fool of yourself dancing and not only will she never speak to you again, but she will tell all the other girls in the school that you are a klutz. You practice with your little sister and your cousin before the date. When you get to the dance, you are determined to make the dancing work. You try hard to be a better dancer than you really are (you are content-oriented). But because you try so hard, you end up stepping all over your partner's feet.

Your life is ruined; you were never meant to be anything but an other-handed klutz. If you could have only relaxed and become a bit more process-oriented, you could have pulled your partner close to you, she could have felt your movements, and you both would have appeared to be dancing with some skill. The key to dancing well and profiting in the market is an ability to relax and simply go with the flow. That is what this book is about; getting with the process; letting go and going with the flow.

This material will defuse much of the miseducation of modern technical analysis and demonstrate the way the market really works and how to profit from that knowledge. When Trading Chaos was written several years ago, our goal was to take 80 percent out of a trend move. We wanted to get in on the bottom 10 percent and get out on the top 10 percent of the price movement. In the intervening years, we have sharpened both our research and ourstrategy. Today, our goal is not to take 80 percent from a trend move but to take 300-500 percent of the trend move.Previously, if there was a200-point move in a commodity or stock, we were well satisfied with 160 points in our pocket. Now our achievable goal is to bank 600 to 1,000 points on that same move. Unbelievable? Not after you have read this book and seen the results in your own trading.

(Excerpts from New Trading Dimension: How To Profit From Chaos)

Content Versus Process

2006-12-11T22:01:00.000+08:00

Midas ~ Gold finger, breakout from 1.17 with volume, supp 1.10

China Milk ~ retracement complete? supp 1.28, target res 1.40

Genting ~ 'Air Genting', supp .44

Luzhou ~ flag complete, supp .835 , res .875

Wilmar ~ white candle, supp 1.80

Suppose that you are a space traveler. You have just landed from a far away planet, and you find yourself in a room where a chess set has been arranged on a table. You want to understand exactly what is going on in this strange Earth. You examine the chess pieces individually and notice that there are several different shapes and sizes. You want to really understand, so you do an "electron analysis" of each individual piece. You know the exact location, size, and makeup of each piece. You thoroughly understand the makeup and thecontent of the entire set.But unless and until you understand the process of playing chess, you will never understand the game and its significance will be lost on you. In over four decades of observing traders and trading, I have come to the conclusion that most traders approach the market with the same orientation as our fictitious space traveler.

Both are primarily concerned with content as opposed to process. Our space traveler will never understand the game of chess until he observes two people playing and competing against each other. This is not necessarily bad; it just doesn't have a great payoff. We traders do it with each other when we ask:

* How much did you make this month?

* Did you go long the gold?

* What kind of car do you drive?

* Will you show me your P&L statements?

* Can you give me someone who is using your approach profitably?

* Did you know that this market is heavily oversold?

All the above examples center on content rather than process. Both my scientific background and my experience in trading have convinced me that the primary difference between winners and losers is whether they focus on content or process.

(The above are material extracted from Bill Williams' New Trading Dimensions - How to profit from Chaos in Stocks.)

Friday

2006-12-07T21:40:00.000+08:00

SP Chemical ~ consolidation mode, sup .645 , target res .70

Seksun ~ trading range, sup .39 , target res .43

Luzhou ~ porridge reloaded, sup .825 , target res .91

Seksun and SP Chem are 2 stocks that i noticed having good strong EPS growth in 2006. Trading through Technical Analysis would be like checking to see when a supermarket is likely to give discounts on its fruits, while trading on Fundamental Analysis would be like getting to know the cost of the fruits to the supermarket and guessing how high the price it is likely to sell in the future.

All Under Heaven

2006-12-05T21:43:00.000+08:00

Very often, the greater truth belies the simplicity of it all. The hero is one who can forsake his own personal vendetta for the sake of the greater good. They say history is written by the victors, while heroes and villains are but just one hairline of difference. In trading, certain decisions have to be made, be it cutting of losing stocks going downhill or riding on climbing stocks, for the sake of your overall portfolio. When price of a stock goes up, it becomes a hero, when it goes down it becomes a panda bear. Such is the similarity between life and trading. Understanding trading, is understanding Life itself.

China Enersave ~ Compressed spring, supp .16, breakout lvl .175 , target res .20

Sembmarine ~ submarine rising.. again , supp 3.22 , target res 3.50

Chartered Semicon ~ beam me up scottie, supp 1.34 , target res 1.47

Live like No Tomorrow

2006-12-05T00:22:00.000+08:00

We are often told to live our days like no tomorrow, literally, so that we can be more time-efficient or to treasure our 'lasting' moments. However like what Bill Murray discovers in the movie, the significant of living your day like no tomorrow is actually to live the day u would want it to be lived, with no regrets when tomorrow comes. May i wish all of us would live our days like theres no tomorrow..

Tech Oil & Gas ~ 2nd phase of uptrend, supp .775, res .835

FerroChina ~ China Steel! Uptrend, supp .765 , res .845

Just for Laughs

2006-12-01T22:22:00.000+08:00

Enjoy your weekend and i will see you back on monday. Cheers!

Highest Form of Victory

2006-11-30T23:24:00.000+08:00

Mastering others is strength. Mastering yourself, makes you fearless. I remember an old Beer advertisement by 'little moustache' Lin, saying in the line of whether you would change yourself to suit the environment, or change the environment to suit yourself. I would like to believe that mastering oneself is a higher form than mastering others. True, lasting joy and happiness comes from within ourselves. Those joy and pleasures that we derives from the external world can ultimately brings about its opposite, pain.
Which brings us to the saying mentioned by Sun Zi; the highest form of victory comes from not sacrificing a single life to yield the enemy, as oppose to total annihilation. To be able to embrace, accept and indirectly yield the enemy is the greatest art of all. Afterall, there is but only one people under the same sun.

Pacific Century ~ Little Superman's baby. supp .39 , res .435

Cut and Run

2006-11-29T23:53:00.000+08:00

Yes, cut and run, thats probably one tactic that would ensure one's survival in the wild jungle of stock market. Like i mentioned before, buying is easy, the difficult part is in the selling. Master the selling skills well, ensure losses kept at a minimum, ride on the profits and thats half of the battle won. There is however some ambiguity on when to cut. Generally 3 ways, first method is to cut on supp broken, second is to cut on certain preset percentage of losses relative to your capital to bear b4 cutting and lastly percentage of fall in prices relative to the current stock price. Although different situations would dictate which method u would choose, u may want to get comfortable with one method with which to depend on to protect your chips, your capital, in the casino..

NOL ~ Seapower! supp 1.98, target res 2.34

Semb Kimtrans ~ Logistic power! supp .59, target res .65

China Kangda ~ rock bottom, supp .50 , target res .56

Not This Day

2006-11-27T22:28:00.000+08:00

"I must not fear. Fear is the mind-killer. Fear is the little-death that brings total obliteration. I will face my fear. I will permit it to pass over me and through me. And when it has gone past I will turn the inner eye to see its path. Where the fear has gone there will be nothing. Only I will remain."
--- Frank Herbert, Dune - Bene Gesserit Litany Against Fear

StraitsAsia ~ Ascending triangle, breakout lvl .695 gives target res of .79

Bush Truest Moments

2006-11-24T23:23:00.000+08:00

US President Bush is often at the blunt of many jokes on his speech deficiency, funny antics and stuff. However personally i find him a person who is true to the moment when he is in the public. He gives me a feeling that he does not try hard to put on a mask or hide his feelings when speaking. Well, maybe not so good a quality for a President but the americans voted for him, so too bad, Americans, you have to live with it. The media in america have no qualms making jokes out of the president which in Singapore is a strict no-no. Good thing, bad thing? U decide.

Enviro-Hub ~ Uptrend still in tact, supp at .55/.525

This Is Freedom

2006-11-23T23:05:00.000+08:00

At the end of every ICT (Reservist In-camp Training), we were given a questionaire, a sort of feedback from the Nsmen to the top officials. I remember several of the questions are asking us, in the line of whether we would die fighting to defend Singapore. This is met with cynical remarks from many NSmen. Some say they would be the first to run should a war descend upon Singapore while others say given a choice they would find the safest spot should there be no choice but to participate in the war. Yes, hardly encouraging isnt it? Of course i believe should that day comes, many would still fight to defend, well maybe not in the frame of mind of the country but definitely for their families.
Actually, we can see a subtle difference in the mentality between us and the westerners. An American General Patton during WWII once commented that he did not want his soldiers to die for his country, he wants them to let the bastard enemies die for their country instead. We may laugh at this seemingly tongue-in-cheek statement but it actually reflects our attitude towards life. Proactive vs Reactive. Think about it..

Celestial ~ 2 white soldiers, 3rd one coming? supp 1.52, res 1.68/1.79

FerroChina ~ failure to break .835 on next session could see a flag formation with supp at .76. A breakout of .835 would meet res at .90

China Paper ~ superbull, breakout of .335 gives a target of .355, supp at .305

Starhub ~ won exclusive epl rights for 3 seasons. supp 2.10, target res at 2.23/2.30

Wanna Break Free

2006-11-22T22:51:00.000+08:00

Last year this month, analysts forecasted 2006's STi target to reach 2600s. Fast fwd to now, we have not just break free of 2600, we are attempting to touch 2900, almost unthinkable a year ago or even 2 years ago, with all the global issues of birdflu, soaring oil prices, north korea hanky panky, China's overheating economy and so on. All we need is a good reason for the naysayers to predict STi to sink back to 2200 and some say 2000. I always marvel at their wonderful 'PREDICTION' with their WAVE analysis. Yes i am no fan of wave analysis, which contradicts its purpose in the first place. Why would one use a wave analysis when one could simply adjust a particular wave to be invalid to suit his initial overall PREDICTION. Yup, i hate to predict not bec i am chicken but i think it is very IRREPONSIBLE to predict and i cannot stress enough that prediction would do us no good. What we need is an objective view of the CURRENT situation of a stock to gauge the likely outcome when we have reached a particular point in the future. Nope, this is not prediction. This is objective analysis.

Well, to the naysayers, history would tell a much different tale. And it is very important to recall what has been said and happened in the past, in order for us to make a reference on for our decisions. This happens to be the essence of Technical Analysis as well.
On a side note, one wonders the accomplishment of Adolf Hitler has he been living in our time. His charismatic personality would have been able to contribute immensely for a good cause in the U.N. or something .. No?

China Print Dye ~ reversal time, supp .225, res target .285

Pine Agri ~ bean power! supp .545, res target .585

ChipEngSeng ~ construction time? supp .33, res target .36

What is Freedom

2006-11-21T22:57:00.000+08:00

They say you won't know what it is til you have lost it. True, infact it applies to every little thing that we take for granted. Non-polluted air, clean water, great sanitary conditions are but just a few examples. The question really is, can we make the best of our present conditions to succeed in the stock market, which not many ever had the chance like us do in this time and age. This is truely the Golden Age of Internet trading and we, are the pioneers..

Semb Kimtrans ~ superbull, supp .555, target .625

Jiutian ~ retest the skies, supp .865, res .96

Ausgroup ~ rangebound, supp .47, res .51

Every Move You Make

2006-11-20T23:36:00.000+08:00

Alan Greenspan vs Ben Bernanke, abstract vs transparency. It must be tough filling the shoes of Greenspan for Bernanke as he take over the Fed chairmanship. On Greenspan's reign, the market breathes with every word he makes. And he seems to reveil on it with seemingly incomprehensible terms and sentences.Fast forward to the present, Bernanke promises a transparent policy-making and so far has kept his promise as every interest rate increase or rate cuts are pretty much anticipated without much surprises.
Going forward, it leaves much to be seem how well Bernanke would lead the US economy towards a new year, beating inflation without seriously affecting demand and growth.

STATCP ~ 3 white soldiers bullish, supp 1.04, res 1.18/1.34

SingPost ~ the mailman delivers! supp 1.00, target 1.10

Global Voice ~ bullish price-volume, supp 0.135, res 0.165/.185

Bush in Town!

2006-11-16T23:42:00.000+08:00

The results of the US midterm elections are out. As much as we would like to think that Asia is growing well economically and that China is going to be the economic superpower in the next decade or so, the influence that Uncle Sam has on asian economies cannot be underestimated. US economy is dependent on local consumption and as long as the americans keep up on their spending, the US govt is satisfied. Asian countries on the other hand, is majority dependent on export trades, so any factors that are going to dampen demands for asian exports is going to affect us badly. For us in Singapore, at least we have the Integrated resorts soon to spur our tourism revenues. To that, lets look forward to a vibrant economy in 2007. Cheers!

Back in Time

2006-11-15T23:00:00.000+08:00

What if you could reach back in time? What would you do? Would you change the past? I know many would choose to buy the winning number for the coming ToTo though. Well the fact is we could not go back in time to the past, to change something which we would want done better. We could do the next best thing though; learn from the past. The heart of Technical analysis is that stock movements conform to patterns and these patterns have high probability to repeat themselves. So although we cannot be like Michael J.Fox, we sure could learn something from the past to improve our present moment..

MemoryD ~ tech power! supp .305 , target .385

Jurtech ~ aint no walk in the park, supp 1.09, target 1.21

Sembmar ~ rock bottom, supp 3.22, target 3.50

Sino-Env ~ hitting the roof, res 1.37, supp 1.18.

Greed is Good?

2006-11-14T22:31:00.000+08:00

What do you think? They say having all the money taken off you is worst than not having that money in the first place. In this dog-eat-dog world that we have come to live in, you can find such people who lives by this motto aplenty. It is this trait that enables them to survive in this world they reasoned. Well, much like in the this movie, the greed sure has its way to bring down the greedy ones in one way or another. We do not need another real-life example in our market. The ones that surfaced has been bad enough for the investing community in general.
What do i think? Greed is bad. Do not mistake desire with greed. Greed is more than desire, it is an insatiable desire for something. It is uncontrollable. So the next time u hear someone saying 'Greed is Good' , give a light laugh, shake your head and give a pat on that fella's back.

Wilmar ~ wilmar! I'm hommeeeee! Pausing for a breather, supp 1.47/1.30

SGX ~ what goes up.. Supp 5.05/4.84/4.64

DBS ~ retracement complete, range 20.00-21.00

Crazy Or Conviction

2006-11-13T23:11:00.000+08:00

The line between being crazy and being strongly convicted in ones' beliefs is actually very thin. A person who held strongly on his or her beliefs can often be regarded as being stubborn, infexible and even crazy.It would be like going against the crowd, being different, being special and it sure requires hell lot of faith. Probably thats why those succeeded are held as expert and are given hero status. Even those who first suggested men could one day walk on the moon are labelled as 'Luna-tic'. History would tell us otherwise.
Trading for success or living is never an easy job. It sure requires lots of faith in what you are doing. Many times we see the glorious side of successful traders, but do not see that it is a result of countless mistakes and losses in the market prior to hitting the right formula. You will need more than passion to continue in this game of winning and losing. Do you have that flame of desire in your eyes?

Sino-Env ~ Exploding reversal, supp 1.18, target 1.34

MMI ~ doji, retracement complete? supp .97 , target 1.07

Born or Made

2006-11-09T00:27:00.000+08:00

If you ask him, he would definitely tell you, its made. Even as a teenage, Michael Jordan's favourite 'ECA' is baseball. He didnt even made it for his colleage's selection. But as history would prove, he epitomises what basketball playing is in the 90's and still is a model player for the new generations. We watch him play with exhilaration and cant help assume that this guy, has it all in him the talents to be a nba superstar.
Well, in actual fact, michael jordan admits that it is his hardwork and not innate talent that helps his developments. In practice sessions, he would always be the last one to remain the the court practising, doing all the routines and shots more than any of his teammate does. He believes that practice does make perfect. When he started playing basketball, he regards so highly his elder brother's skill in playing that he chose the number 23 as his jersey number because he reckons that his skills is only be half of his brother's. When he returns from his early retirement, arguably at the highest peak of his career, he chose the number 45, yup, he still thinks he is a notch below his brother's skills in playing the game.
In trading, although it may not be as clear cut as a basketball game, but the psychology behind the game is as similar as trading. The person who practised and learn the most, is the one who does best on the court. The court has becomes his or her playground. Will you practice like MJ does?

Celestial ~ time to rest, supp 1.68/1.52 , res 1.82

See Hup Seng ~ marine play, supp .185 , res .25

Inno-Pacific ~ breakout mode, supp .025 , target .065

Good or Crook

2006-11-07T23:08:00.000+08:00

Just like in the movie, the people you think are good may not be so, while the people who are labelled as crook may not be so as well. You may trust the advice and buy/sell calls from the brokers but would they have any hidden agendas when they do so? Well, ever since history, there has been no lack of white-collar crimes in the stock markets, even from a squeaky clean Singapore. If there are so frequent such cases every now and then, one wonders how many other cases go unreported. The morale you asked? Trust your own judgement and take responsibility for your own decisions. Good luck!

BH Global ~ Hitting the ceiling, res .355 supp .33

Koh Bros ~ doji, wait for confirmation of reversal if .165 taken out, next supp .13

Sembmarine ~ From down under, supp 3.20 double bottom? Target 3.44

Your Pain Body

2006-11-06T22:51:00.000+08:00

Most of us regard our thinking as being ourselves, our consciousness, our identity. Have you ever noticed someone or even yourself muttering out things as your mind playback some events in the past like a recorder. We get angry, ashamed, guilty or happy as our mind play back the scenes. Next time you find yourself reacting to your own thinking again, try to be aware of what your mind is showing you. Be aware of your thinking. You would find that your mind would enter a short phase of non-thinking when u begin to be aware of what you are thinking. It is this moment that you get in touch with your consciousness where your mind is the clearest and most perceptive. Do you remember how you feel when you saw a beautiful sunrise or sunset? Then something, some problems you have to solve pops up in your mind again and the magic is gone. That brief but beautiful moment is the closest you would get to your own consciousness. So next time, don't let your mind play tricks on you or your trading again. :)

Bio-Treat ~ dragonfly, wait for confirmation of reversal candlestick. Target .68

Ausgroup ~ Breakout resistance .515 , supp .465

DBS ~ Reversal? Target 21.20

Change of Role

2006-11-02T21:55:00.000+08:00

A bully becomes the bullied, the bullied becomes the bully. In trading, a buyer has to become a seller in time while a short-seller has to become a buyer in time as well. Buying is easy, the difficult part is the selling. As in real life, it takes efforts to sell an item whereas a buyer do not exert much effort. Hence, knowing when and what to buy is only half the balance. The other half is learning when and what to sell. The secret lies in the 'balance'.

Enviro-hub ~ 2 white soldiers, a possible 3rd joining? Supp .42

Jiutian ~ Flying towards the nine skies. Super uptrend, supp .90

Synear ~ De ja Vu. Towards 1.29.

Be Like Water

2006-11-01T22:53:00.000+08:00

Many of us would probably remember Bruce Lee as a martial art expert with lightning- fast kicks. Bruce however, graduated with a degree in philosophy during his time in the US, and would often infuse his own style of philosophy into his martial arts. The legacy he left behind in his own style of philosophy is as profound as his self-style formless and most efficient approach towards martial arts. So my friend, be like water. In life and in trading.

SembMar ~ Submarine rising, breakout level 3.50, target 3.56.

ST Engg ~ Powered up, 3.00 breakout level, target 3.12

AscendasReit ~ Ascending mode, breakout level 2.23, supp 2.14

Don't Be Evil

2006-10-31T22:09:00.000+08:00

'Dont be evil' , hardly a biz philosophy one would associate with a tech company like Google. But it is this motto that Google and its 2 founders base their foundation on, to become one of the fastest growing and successful company in history. Can we learn a thing or two from it?

Gallant ~ retracement complete? support .915, res 1.03

Synear ~ fond memories coming again.. supp 1.17, target 1.29

China Sun ~ rising from the east again.. supp .665, res .735

Excellence of Execution

2006-10-30T21:21:00.000+08:00

Trading at the ultimate level, requires a seemingly ruthless efficiency in executing orders. A few had done it, but with dire consequences in other aspects of their lives. The key i believe is in the 'balance'; the cold, ruthless execution of trades as well as a huge capacity for love and compassion in his or her life. Do you have what it takes? :)

Interestingly, saw an old army mate on CNA show, the Million-Maker, he probably has reach that balance already in his life.

China Milk ~ milking season over? supp 1.10 , target 1.28

Epure ~ 'M' is for MacDonalds only, .74 support, target .80

Cosco ~ low tide mode, support 1.82

BiG Players Tactics

2006-10-27T21:26:00.000+08:00

Thats how Big players play, sacrifice the small bait move, win the subsequent big move.

ST Engg ~ Powering up towards 3.00 mark once again

China Sun ~ Trading range, between .74 to .795

Sunray ~ Heavy resistance at .30 , breakout target of .345

Back in Business!

2006-10-25T21:53:00.000+08:00

CapitaLand ~ Coast clear, broke out of res at 5.25

Wilmar ~ Dark cloud covering, fails to break 1.30, next supp 1.18

SingTel ~ D-Day, res 2.58 once cleared, next target 2.64, else back to support 2.51

Perfect Strangers ..

2006-09-23T00:22:00.000+08:00

We all are, in a way, aren't we..

Global Testing

2006-09-23T00:03:00.000+08:00

Global Testing Corporation Limited provides testing services to the semiconductor industry such as wafersorting and final testing services. The Group's operations are in US and Taiwan and counts among its customers the world's leading foundries namely TSMC and UMC.

Technically, immediate support is at .245, from RSI we see that it is heading into the 30% oversold region. It is important to observe the price movements at this point; if prices breaks down from .245 and rsi into the oversold region, it means the support established at the previous oversold point has been broken and it has effectively entering a new downtrend. On the otherhand, if prices manage to maintain above .245 which rsi enters the oversold zone, prices can be expected to remain rangebound and rally from .245 . Next significant support at .225, next levels of resistance at .26/.275/.29 .

Dear friends, i will be away to my in-camp training from 25th Sep til 6th Oct, in my absence i sincerely hope that you would continue to learn and discuss your views over here. It would be much appreciated if you know something abt technical analysis to give your valuable comments. If you have just started learning TA(its not too late if you havent!) this would be a great opportunity to join in the discussion. I shall now leave you with a thought for the day; 'We may not live forever, but our knowledge will, if we take the time to share.'

Have a profitable weeks ahead! Cheers!

SPC

2006-09-21T23:51:00.000+08:00

As requested by JAMES. Listed since 25 October 1990 on SGX Mainboard, SPC business activities can be classified into Downstream (petroleum refining, trading activities, storage and terminalling of finished products) and Upstream (exploration, development, production, sale of oil and gas and investment in pipelines).

Technically, prices have been steadily declining after reaching recent high of 5.20. The decline in spc's prices is a reportedly attributed to the weakening of crude oil prices, which has affected refining prices for SPC. RSI is trapped within a downtrend zone with next significant support at 4.36. Prices need to stablize at the 4.60 region in order to break away from the downtrend.

Semb Kim

2006-09-20T23:44:00.000+08:00

As requested by james. Listed since 3 February 2000 on SGX Mainboard, Sembawang Kimtrans Ltd is a leading integrated logistics service provider, offering air, land and sea logistics services.

From chart, prices looked set to stage a comeback after touching support at .60 , with resistance at .64 , other support levels at .58/.53 . RSI is trending well into an uptrend channel. Using this as an example, if one is to use supp at .60/.58 and resistance at .64 as a reference, the risk/reward ratio would be 1:2 , the risk of falling by .20, the reward of rising .40 .

Memory Devices

2006-09-20T00:05:00.000+08:00

As requested by Elizlow. Memory Devices Limited manufactures and sells solid state memory storage products such as DRAM memory and flash memory modules which are used in a wide variety of products such as computers, notebooks, handphones and cameras. The Group's manufacturing facilities are in China.

Technically, prices broke out of resistance at .29, next resistance at .315/.34 , with support at .27 . RSI though, had reached the top end of the uptrend channel, hence prices likely to consolidate around .29 for some time before testing .315 .

One point to take note is that any news release in relation to a particular stock has an overriding effect on the stock's chart formation. It may gapped it up or down before resuming its previous formation or even starts a new formation from then on. Take Cosco for example, last three days its been rallying, i suspect those in the know had already loaded up on Cosco, waiting for the news release to offload their shares. This would be a case of buy on rumor, sell on news. Whereas for unexpecting news, it would totally disrupt the stocks current trend. Bio-Treat is an example. Gapped down heavily on the weaker than expected earnings report.

Luzhou BioChem

2006-09-19T23:28:00.000+08:00

As requested by chamelon. Luzhou Bio-Chem Technology Limited is engaged in the refining of corn, distributing and selling corn-related products such as sweeteners, corn starch, corn gluten meal, corn fibre, corn germ and steepwater. The Group production facilities are in China.

From chart, prices is temporarily supported at .75, resting near the 50MA. Next level of support at .72/.69/.645 with current resistance at .80/.86 . RSI shows weakness, dropping below the 30% mark with prices likely to consolidate further in the near term.

Utac

2006-09-18T23:21:00.000+08:00

As requested by sunningdale. Listed since 9 February 2004 on SGX Mainboard, United Test & Assembly Center Ltd provides test and assembly services to the semiconductor industry and has been listed as the 9th largest independent provider of semiconductor test in 2002. Headquartered in Singapore, the Group has manufacturing facilities in Singapore and China.

Technically, today prices broke the resistance at .76 and closed at .77 with above average volume. Next res to breakout from is at .78, once taken out convincingly, next significant res lies at .835/.885 . Support is established at .725/.695 . RSI shows good strength and is trending nicely upwards towards the overbought zone(above 70%). That does not mean the stock is 'overbought' per se, only when rsi starts to cross the 70% mark downwards that signifies the overbought position is undergoing selling down.

Once again, i do not stress enough the advantages of having a charting software to practice what we are talking here. With every steps we make in practising, we are progressing forward in our stocks' knowledge. I would like to share the thinking process that helps in our decision-making on whether to buy a certain stock; First, do u hv a compelling reason to believe its value will rise in the immediate future? Second, the question we must always ask ourselves before making any trade is: do we know the risk/reward ratio of entering the stock? The potential reward(gain) must outweigh the potential risk(loss) and by as much as possible. How do we know the ratio u ask? The details all in the chart. Where are the resistances and supports, how is the strength of its current trend are all the information we can use to gauge the potential reward(gains) and risk(losses).

SGX

2006-09-17T18:11:00.000+08:00

As requested from the stocks poll. Listed since 23 November 2000 on SGX Mainboard, SGX owns and operates the Securities and Derivative exchanges in Singapore and was the first to introduce an electronic and floorless Securities exchange in Asia.

Technically, SGX has regained the 4.00 foothold, significant support at 3.90/3.72 , resistance at 4.20/4.50 . From rsi, we see that it entered the overbought zone while prices still failed to break 4.20 which was attained when it last previously reached the overbought zone. This signifies that prices is likely to remain rangebound below 4.20. Watch out for breaking out of 4.20 for any breakthrough.

Trading Is War.

2006-09-15T23:57:00.000+08:00

As frequent visitors might hv know, I am a military buff and as i will be attending my annual In-Camp Training from 25th Sep to 6th Oct, i feel it is befitting that i give an analogy to trading as liken to being in a war. Treat every single dollar u have as a soldier, $10k as 10,000 soldiers. When you are winning and captured designated objectives, u gain reinforcements, more soldiers, equals more profits. When prices fall, every dollar you lose is a soldier KIA. To minimize losses and prevent more of your men killed, you have to withdraw your men. Cut loss and look for new objectives, new trades. Unfortunately in war as in trading, it is a zero-sum game, your gains is another's losses. The key is really to prevent losses and keep it to a minimum and your gains will take care of itself. Thats how i feel trading should be. And i am still learning everyday, hoping to master it.

(Acknowledgement: the above YouTube clip is extracted from the miniseries Band of Brothers, on the attack led by LTA Richard D. Winters on german artillery batteries attacking the beachheads landings of the Allied forces at Normandy on D-Day. The attack saved many lives of the Allied forces and is still studied in Military schools around the world as a standard attack on objectives under an effective base of fire. Richard D. Winters is awarded the Distinguished Service Cross for his actions.)

K1 Ventures

2006-09-14T22:45:00.000+08:00

Listed since 8 October 1987 on SGX Mainboard, K1 Ventures Ltd is an investment holding company which focuses on identifying and investing in companies with significant gap between the company's current value and potential future value.

Technically, the 61.8% retracement from low of .30 to high of .445 lies on .39, which would be a significant resistance for the mean time. Support at .365/.34 .

All these times, i find that in stocks trading, all of us have our own little style of doing it, which we may or may not consciously notice it. You may particularly buy breakout stocks while i may buy on support, sell on resistance, while she may follow fundamental news to trade. The point is; there is no one right way to trade. Most important thing is to recognize our own preferred style of trading and improve on it, day by day. Only then can trading comes as second nature to you. There is no point in duplicating how another trader trades as we would have learn nothing out the exercise. With this in mind, i wish all of us would find our own path towards profiting in the stock market!

KS Energy

2006-09-13T22:57:00.000+08:00

As requested by MICH. Listed since 11 March 2002 on SGX Mainboard, KS Tech Ltd is a leading supplier of oil & gas equipment, hydraulic equipment, instrumentation, valves, spares and parts to the oil & gas, marine, mining and petrochemical industries in China and South East Asia.

From chart, prices form a top between 2.55 to 2.43 and when 2.43 was taken out, prices begin its descent until today where the decline was halted at 2.20 region supported by the 50MA and a close 100MA. Expect another significant support at the 2.15 level. RSI is turning up from the oversold region. A rise above todays closing of 2.25 would confirm the reversal.

China Precision

2006-09-13T00:06:00.000+08:00

China Precision Technology Ltd provides integrated manufacturing services to the consumer electronics, automation equipment, telecommunication and automotive industries. The Group's major manufacturing industries are in China and counts Samsung Group, Sony Group, Toshiba Group, LG Group and Panasonic Group among its customers.

From chart, prices turned down after hitting high of .43, with rsi in the overbought zone. Ideally, we would want price to break resistance .43 with rsi rising above the 70% mark, however that did not materialise, hence look to consolidation at the .40 level again before staging another attempt for a breakthrough. Next support at .375/.355.

Xpress

2006-09-11T23:07:00.000+08:00

As requested by rog. Listed since 28 June 1999 on SGX Mainboard, Xpress Holdings main focus is in the financial printing market namely equity research reports, corporate annual reports, Initial Public Offer prospectuses and mutual fund documents.

Technically, prices broke through resistance at .185 as rsi continues to remain above the 70% mark signalling a strong uptrend. Next resistance at .215/.235, support at .165/.145 .

One technique of using RSI is to see if prices breaks through any resistance as its rsi enters the 70% overbought region. If it doesnt, then prices are expected to remain rangebound. The same applies to the downside, when rsi enters the 30% oversold region, do prices break down below any support? If they do not, then prices are expected to rebound and remain rangebound.

Sunray

2006-09-10T11:49:00.000+08:00

As requested by Exdous. Listed since 5 November 2003 on SGX Mainboard, Sunray Holdings Ltd is a manufacturer and supplier of medical apparatus such as obstetrics and gynaecology systems and neurophysiological systems. The Group products are marketed to hospitals in China.

From chart, Sunray is technically weak after breaking down from support at .30 level albeit with low volume. Prices could slid down to teh .275 region if it does not stable itself along the upwards-sloping trendline. Its weakness is shown by the rsi as it is trapped within a downward-sloping trend channel at the moment.

China Hong

2006-09-07T23:15:00.000+08:00

As requested by shrek. China Hongxing Sports Limited designs and manufactures sports shoes as well as other sports apparel and sports accessories in its production facilities in China. The Group markets its products under the Erke brand.

From chart, rsi has turned down from the 70% mark, signalling a sell. Support at 1.52/1.40. Next target after consolidation along the trend channel, stands at 1.68.

Fung Choi

2006-09-06T23:39:00.000+08:00

As requested by ateo. Listed since 20 October 2004 on SGX Mainboard, Fung Choi Prntg & Pckg Grp Ltd provides printing solutions such as commercial printing and packaging printing. The Group also manufactures a wide range of corrugated cardboard packaging products.

From chart, the lastline of defence is at .59, volume is shrinking on past few days of gradual declines. MACD is turning positive, with the faster(short) MA about to cross the slower(long) MA, a sign of reversal. Next resistance at .69/.745/.82.

Wilmar

2006-09-05T22:27:00.000+08:00

As requested by cas. Wilmar International Limited is a palm oil refiner as well as crushers of copra and palm kernel. The Group also owns sizeable oil palm plantations in Indonesia.

Wilmar became listed after a reverse takeover oof Ezyhealth. Basically how reverse takeover works is that a reverse takeover (RTO), also known as a back door listing, or a reverse merger, is a financial transaction that results in a privately-held company becoming a publicly-held company without going the traditional route of filing a prospectus and undertaking an initial public offering (IPO). Rather, it is accomplished by the shareholders of the private company selling all of their shares in the private company to the public company in exchange for shares of the public company. There are many advantages why private companies would take the RTO route, one of which is the lower cost compared to a straight IPO. While the transaction is technically a takeover of the private company by the public company, it is called a reverse takeover because the public company involved is typically a "shell" (also known as a "blank cheque company", "capital pool company" or "cash shell company") and it typically issues such a large number of shares to acquire the private company that the former shareholders of the private company end up controlling the public company.

From chart, support is at 1.12/1.17, resistance at 1.24. 1.17 is the 38.2% retracement from high of 1.30 to low of .935. On today's close, price rebounded from 1.17. Look for a confirmation sign on tomorrow price action for a reversal play.

Dairy Farm

2006-09-04T22:51:00.000+08:00

As request by Ace. Listed since 20 February 1991 on SGX Mainboard, Dairy Farm International Holdings Ltd is a leading retail player with numerous retail stores such as supermarkets, hypermarkets, health and beauty stores, convenience stores, home furnishings stores and restaurants located all over Asia.

From chart, today price shoot up from yesterday's 'doji', confirming the reversal. In the process, it had also brokeout of resistance at 3.18, but closed lower at 3.14 on market close. Once 3.18 is convincingly broken, next target for Dairy farm is at 3.46.

Olam

2006-09-02T17:15:00.000+08:00

Listed since 11 February 2005 on SGX Mainboard, Olam International Limited provides supply chain solutions to global companies such as Kraft, Cadbury, Mars and Nestle. The Group sources agricultural products and food ingredients for customers spread all around the globe.

Technically, the breakout from the 1.50-1.54 region, which happens to the 61.8% retracement from low of 1.18 to high of 1.77, send Olam rocketing upwards. From trend channels of its rsi, price has higher probablilty of consolidating at the 1.50-1.54 region before breaking through to the 1.60s region convincingly. Notice the 1.40 level, which is where the 50 MA lies. It would provide significant support for any adverse movement south.

SPC

2006-08-31T23:35:00.000+08:00

As requested by Elizlow. Listed since 25 October 1990 on SGX Mainboard, SPC business activities can be classified into Downstream (petroleum refining, trading activities, storage and terminalling of finished products) and Upstream (exploration, development, production, sale of oil and gas and investment in pipelines).

Technically, SPC is very weak and closed on intraday low of 4.84, a 3-month low. Next support at 4.80/4.60 , if price rebound at 4.80 in accordance to the plotted uptrend channel, next significant resistance are at 4.96 and 5.20.

China Milk

2006-08-30T22:47:00.000+08:00

As requested from the stocks poll. China Milk Products Group Limited is engaged in the production of pedigree bull semen, dairy cow embryos and raw milk. The Group's operations are in China.

From chart, .96 is established as the support for the time being. The 38.2% retracement from the low of .85 to high of 1.48 is at 1.10, which will be the resistance for any upwards rise. If .96 taken out, next significant support at .895/.85.

Unifood

2006-08-29T22:17:00.000+08:00

Listed since 26 March 2001 on SGX Mainboard, United Food Holdings main business is the production of animal feeds, pigs of quality breeds, fresh, chilled and frozen pork, processed meat products and healthcare supplements in China.

From chart, .245/.23 , resistance at .27. RSI has hit support and momentum indicator is turning up, higher probability of price going up soon to test .27. A break og .245 on the other hand, would see price consolidate at .23 level.

ASL Marine

2006-08-29T00:00:00.000+08:00

Listed since 17 March 2003 on SGX Mainboard, ASL Marine Group is an integrated marine company with core business in shipbuilding, shiprepair and shipchartering. The Group's operations are in Singapore and Batam, Indonesia.

From chart, support at .695/.67 , ASL hit .77 and receded, it will be a strong resistance to overcome in the near term. RSI is turing down from the 70% mark, signalling a sell, momentum indicator is turning down as well. Look to consolidation at the .69-.70 region.

Ellipsiz

2006-08-24T23:09:00.000+08:00

As requested by Grace. Listed since 6 July 2000 on SGX Mainboard, Ellipsiz Ltd provides engineering and advanced packaging solutions to customers in the semiconductor industry in Singapore, Malaysia, Taiwan, China, Vietnam and the USA. The services provided by the Group are divided into Fabless Solutions, Wafer Fab Solutions and Test & Advanced Packaging Solutions.

From chart, the 38.2% retracement from low of .42 to high of .72 is .535 while the 61.8% retracement is .605, which happens to be the current resistence that the price had hit a ceiling. Look to consolidation at the .535 to .56 region before testing .605 again as rsi is beginning to turn downwards at the 70% overbought mark.

Hong Leong Asia

2006-08-24T00:40:00.000+08:00

As requested by Sealion. Listed since 6 March 1998 on SGX Mainboard, Hong Leong Asia Ltd is a manufacturer of Home Appliances, Diesel Engines and Industrial Packaging products with its major manufacturing businesses based in China.

From chart, the 38.2% retracement mark from low of 1.20 to high of 1.95 is 1.45 while the 61.8% retracement mark is 1.67. As such, 1.45 will be a gd support for HL Asia to launch another upwards assault. From the trend channels drawn, prices may not even touch 1.45 before it resumes trending up to test 1.67 again. RSi is turning up, very high chance of price going up north.

Advance SCT

2006-08-22T22:15:00.000+08:00

Listed since 24 November 2004 on SGX Sesdaq, Advance SCT Limited provides Printed Circuit Board (PCB) services such as PCB testing, distribution and rental of PCB-related equipment.

Technically, from rsi's trend channels, there may yet be more uptrend for Advance SCT before retracing. Support at .405/.37/.33.

Many times, i was asked by people whether they should enter a position for a particular stock. There is really no certain answer for that, cause u have to know why u notice the stock in the first place. Heard from research report? Broker's call? Tips from your broker? Or from a friend who work in that particular listed company? Or you just happen to notice a nice chart formation yourself. Frankly, i would go for a combination of the above factors BUT with a heavier weight on the chart formation part. Next u have to ask yourself what is your timeframe of trading that stock? Buying it for contra? Can u wait for one month with little movement in the price? When u have the answers for the above, the next crucial part is to ask yourself: How much rise in the price will i be satisfied to take profit on? And equally important: How much drop in the price can i endure before cutting it short? When you have the answers of these questions, frankly u can go ahead and trade the stock. There is none other in the whole world u can trust but your very self. Trust your instincts. Others judgement may not necessarily be better. And most importantly, take responsibility on your own actions. This way, you would have little regrets/fears/guilts in trading or not trading a particular stock. Take care of your mental processes and the profitable trades will take care of itself. Gd luck!

Semb Kim

2006-08-20T22:39:00.000+08:00

Listed since 3 February 2000 on SGX Mainboard, Sembawang Kimtrans Ltd is a leading integrated logistics service provider, offering air, land and sea logistics services.

From chart, last two session's of super volume propelled sembkim past its all-time high at .65 to close at a new high of .685. However, as draw on the chart, it is still below its main uptrend channel resistance. RSI is showing super strength as it maintains itself above the 50% mark since it recovered in early june'06. Significant support for any downside at .635 and .585.

Midas

2006-08-19T21:50:00.000+08:00

Listed since 23 February 2004 on SGX Sesdaq, Midas Holdings Ltd is a manufacturer of aluminium alloy extrusion products and polyethylene pipes.

Technically, Midas has touched the all-time price of .975, and is now at a crucial point. Will it breakout of the all-time high or will it retrace back its recent rise? RSI is at the overbought region, however it has not turned down yet. Watch the .95 region; if broken, price may retrace back to support at .85 region. Next support at .76.