Category: SG Stocks And Shares

Thursday, November 1, 2018

In my previous email, I have mentioned that STI was oversold. And with that, STI came back up and closed at 3018, breaking past the pyschological mark of 3000, and the gap at 3030. At the point of writing, STI is now at 3043, up…

Wednesday, October 17, 2018

STI opened 50 points above, this forms a nice weekly hammer candle. Yet it is still early to celebrate for the week has not ended yet. Now assuming it closes high as a nice hammer, it should rally for 1 or 2 more weeks. Otherwise, it may co…

10th anniversary of Great Financial Crisis!

As we enter the 10th anniversary of the GFC, predicting the next crisis has been the foremost preoccupation of the media. The most interesting scenario mentioned has been higher interest rates and an economic slowdown sparked by a growing U.S. fiscal deficit. The positive impact of fiscal stimulus on the U.S. economy should wear out over the next two years. But this deficit spending will remain and the U.S. will need to borrow and sell even more Treasuries. To attract foreigners into buying these Treasuries, interest rates will need to rise, which will dampen economic growth. In turn, this will weaken the US dollar, negating the effects of higher rates on the dollar. A negative spiral will then ensue.

Another notable concern is the side effects of quantitative easing. The wealthy have benefited from central bank purchases of financial assets. This has widened the wealth gap and fuelled the rise of populist and nationalist-led regimes. The danger of such regimes is the higher chances of conflict within and between countries. Two years is an eternity for most of us “investors”. Foreigners’ tolerance for U.S. government bonds despite a $1tr fiscal deficit will always be artificially high. The US dollar may be flawed, but it will be hard to lose its global reserve currency and trade settlement status unless a better liquid alternative is found. Therefore, for run on Treasuries to materialise, it needs to be accompanied by higher risk-free yields appearing out of Europe and Japan.

The backdrop for equities in Singapore is turning weaker. News flow is negative as the trade spat worsens. And as we enter U.S. mid-term elections on 6th November, we expect the market to trade even more cautiously. Other economic conditions are not encouraging. We can expect emerging-market economies to weaken as their currencies get pummelled. The slightest signs of higher imports or weaker trade balances will result in the selling pressure on their currencies. Near-term solutions for emerging markets will be contracting consumption and raising interest rates. In developed countries, with the exception of the U.S., Europe and Japan are stuttering. Our position is to remain defensive.

Taken from : https://s3-ap-southeast-1.amazonaws.com/investingnote-production-webbucket/attachments/bacedf0833b1872b35ade0330ca71a323684ba64.pdf?1537751340

UBS Aug SG market wrap summary

UBS Aug SG market wrap summary


MSCI SG index -1% MoM (underperformed MSCI Asia ex Japan); Trades at 13.5x FY18F PE


SG 2Q18 GDP +3.9% yoy; Unemployment rate ticked up to 2.1%

SG residential: Believe buyers will delay buying and resale momentum will slow; physical prices to start easing (Prefer SREITS; Upgrade CapitaLand to BUY – preferred over peers due to lower exposure to SG residential)


Top STI performers in Aug: Yangzijiang (+20%); Venture (+13%); CapitaLand (+7%); Sembcorp industries (+7%); Wilmar (+5%)

Bottom STI performers in Aug: Thai Bev (-18%); Genting SG (-16%); City Dev (-6%); Jardine Strategic Hldg(-6%); DBS (-5%)



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3 Types of Traders & Investors (Which is you?)

As a stockbroker, there is a lot about a trader on how much he watches the chart and the questions he asks. It can be intriguing for some, but it will be easy for you to understand once I characterise these traders based on their chart watching attribute and other whatnots.

Amateur

An amateur doesn’t spend much time in watching charts as he doesn’t know how to interpret it. But he does put in a lot of work and effort in forums and blogs, looking out for advice from experts. Most traders tend to be successful at this point of time in their career as they do trust and follow expert advice meticulously. It is mostly because of this initial run traders get lured into trading fraternity and want to take up the career.

A few behavioural characteristic questions include:

  1.     “So the DBS shares, if S$20 can buy?”
  2.     “Market good or bad now?”
  3.     Will market crash in 2019?”
  4.     “What is the best stock to buy?”
  5.     “Which shares can short to make more money?”
  6.     “I bought Singpost at S$2, should I still hold?”
  7.     “How come today ST Engineering did not rise in price?”


    ….and the list goes on.



It is very very hard to answer such questions in the office with limited time over the phone. Though I am happy to share, but the phones are reserved for placing trades during office hours.

In my case, usually i will reply and try to educate whenever I can. Beginners usually take things in a fixated view, as a result they are unable to see the downside, or the other possibilities that may happen in the market.

And worst kind of questions I ever encountered in my line of work,

“How come you as my stockbroker did not stop me from buying this share? Now i lost money because you didn’t stop me?!” 😑

We all start somewhere, and whatever we learnt we should give back for free. This is the exact reason why i started this blog.

    Intermediate trader

    An intermediate trader watches the chart incessantly as the euphoria of learning and understanding the intrinsicality of the market will be overwhelming.

    However, the incessant gets transformed into addiction and result in over-trading. The intermediary period can be either the dawn or dusk of any trader. It is the trader’s innate trait of will and resilience to find a way out from the slump and revamp his trading strategy and attitude. The quicker the trader identifies the problem of chart watching, the merrier. But, what happens in most cases is that the traders compensate the loss with more hard work — chart watching which is like adding salt to the wound.

    With these above points mentioned, it is also interesting to note that many people tend have associate more computer screens equivates to more powerful and effective trading.

    So what if you can see so many charts? Do you have sufficient response time and effort to key in such trades? Likewise usually market is forward looking, trying to catch that quick trade may result in accidentally losses due to maket swings.

    Thus with such common impression, those selling trading courses will insert such photos for marketing purposes. This blog does not sell trading courses and I am happy to take any questions, or if you are keen to open a trading account with me. And I would like to reiterate again.

    Many many monitor screens is good to have, but it is not a must have. And for me, I only have 2 computer screens.

    Expert trader

    He/she who watches the chart only for analysis and only during pre-trade and closes the chart post-trade is the expert. The expert watches only till he makes a trading decision. It is irrelevant whether the decision can be right or wrong, but the maturity to digest the loss is important. If a trader follows a risk-reward ratio of 1:3, he will be profitable even with a 30 % success rate. But it is essential to follow a system for achieving that kind of success.

    It is a surprising fact, contrary to many biased views, housewives or working ladies are usually better traders than guys. (That explains the picture above.) It is a combination of rationality and probability that makes up major part of their trading strategy.

    Case in point, my most sucessful client trades only 5 types of company shares; DBS, Singtel, Venture, SGX and SIA.

    Yep, 5 companies only.

    She buys, holds and sell at times depending on the market flow. It is very interesting as well as exciting to see her work. I enjoy exchanging trading ideas with her.

    Snippets of conversations sharing her views:


    “SIA is now back to 2013 low, so let’s queue to see if we can get some from sellers at 9.65”


    “DBS has been coming down. I have some shares bought at S$29, but let’s sell some first at S$27 and see if we can buy back cheaper few days later.”


    “Hmm… Venture has dividends and the buyers are rather aggressive, let’s hold it past XD and see how’s the response.”

    In conclusion regardless which types of trader you are, we ALL can be expert traders. We just have to improve and change consistently according to the market. Understanding ourselves is one important key factor to being a successful trader.

    Some of the trading courses out there teaches swing trading, day trading, with some certain “X-factor” and whatnots. If you really have no idea how the market works, I think such courses will help you to gain some insights. BUT you have to remember this;

    If these trading gurus are really that profitable, they should not be teaching courses but trading more frequently in the market.

    For my followers who have been following this blog, I would like to state that this blog does not sell trading courses. I am happy to share always, and that is the purpose of this blog: To share, network and exchange ideas with everyone.

    Any comments please leave it on the page below, or on our Facebook page

    Peace.

    Adding on to Singapore Medical Group (S$0.46)

    Singapore Medical Group (SMG SP) – S$0.46We re-interate our buy call for SMG belowhttps://sgstocksandshares.blogspot.com/2018/07/singapore-medicalgroup-smg-our-view.html We had previously stated that we will adopt a dollar cost averaging for this,…

    Trading Strategies and Ways

    Forex traders use a variety of strategies and techniques to determine the best entry and exit points—and timing—to buy and sell currencies. Market analysts and traders are constantly innovating and improving upon strategies to devise new analytical methods for understanding currency market movements. What follow are some of the more basic categories and major types of strategies developed that traders often employ.

    FUNDAMENTAL ANALYSIS

    In fundamental analysis, traders will look at the fundamental indicators of an economy to try to understand whether a currency is undervalued or overvalued, and how its value is likely to move relative to another currency. Fundamental analysis can be highly complex, involving the many elements of a country’s economic data that can indicate future trade and investment trends.
    A good place for traders to start, however, is in analysing currency inflows and outflows of an economy, which are often published by the nation’s central bank. Additionally, they may rely on news and data releases from a country to get a notion of future currency trends.1)

    TECHNICAL ANALYSIS

    Technical analysis is another main category of currency trading strategies that is highly favoured among traders. Most often it involves reviewing the past and recent behaviour of currency price trends on charts to determine where they may move going forward. The rationale behind using technical analysis is that many traders believe that market movements are ultimately determined by supply, demand and mass market psychology, which establishes limits and ranges for currency prices to move upward and downward.
    Technical analysis encompasses a long list of individual methods used to detect likely currency trends. Many traders appreciate technical analysis because they feel it gives them an objective, visual and scientific basis for determining when to buy and sell currencies.2)

    TREND TRADING

    Trend trading is one of the most popular and common forex trading strategies. It involves identifying an upward or downward trend in a currency price movement and choosing trade entry and exit points based on the positioning of the currency’s price within the trend and the trend’s relative strength.
    Traders will often cite the phrase, “The trend is your friend,” as a reminder that recent trends can be reliable indicators of where prices are likely to go moving forward and where to best set up trade entry and exit points. Trend traders use a variety of tools to evaluate trends, such as moving averages, relative strength indicators, volume measurements, directional indices and stochastics.3)

    RANGE TRADING

    Range trading is a simple and popular strategy based on the idea that prices can often hold within a steady and predictable range for a given period of time. That’s particularly evident in markets involving stable and predictable economies, and currencies that aren’t often subject to surprise news events.
    Range traders rely on being able to frequently buy and sell at predictable highs and lows of resistance and support, sometimes repeatedly over one or more trading sessions. Range traders may use some of the same tools as trend traders to identify opportune trade entry and exit levels, including the relative strength index, the commodity channel index and stochastics.4)

    MOMENTUM TRADING

    Momentum trading and momentum indicators are based on the notion that strong price movements in a particular direction are a likely indication that a price trend will continue in that direction. Similarly, weakening movements indicate that a trend has lost strength and could be headed for a reversal. Momentum strategies may take into consideration both price and volume, and often use analysis of graphic aides like oscillators and candlestick charts.5)

    SWING TRADING

    Swing trading is customarily a medium-term trading strategy that is often used over a period from one day to a week. Swing traders will look to set up trades on “swings” to highs and lows over a longer period of time. This is to filter out some of the “noise,” or erratic price movements, seen in intraday trading. It’s also to avoid setting narrowly placed stop losses that could force them to be “stopped-out” of a trade during a very short-term market movement.6)

    BREAKOUT TRADING

    A breakout strategy is a method where traders will try to identify a trade entry point at a breakout from a previously defined trading range. If the price breaks higher from a previously defined level of resistance on a chart, the trader may buy with the expectation that the currency will continue to move higher. Similarly, if the price breaks a level of support within a range, the trader may sell with an aim to buy the currency once again at a more favourable price.7)

    RETRACEMENT

    Retracement strategies are based on the idea that prices never move in perfectly straight lines between highs and lows, and usually make some sort of a pause and change of their direction in the middle of their larger paths between firm support and resistance levels.
    With this in mind, retracement traders will wait for a price to pull back, or “retrace,” a portion of its movement as a sign of confirmation of a trend before buying or selling to take advantage of a longer and more probable price movement in a particular direction. Traders will often pick a particular percentage movement as a sign of confirmation (such as 50%), or rely on Fibonacciratios (of 23.6%, 38.2% or 61.8%) to help identify optimal points for entering and exiting trades.8)

    REVERSAL TRADING

    As the name implies, reversal trading is when traders seek to anticipate a reversal in a price trend with the aim to guarantee entrance into a trade ahead of the market. This strategy is considered more difficult and risky. True reversals can be difficult to spot, but they’re also more rewarding if they are correctly predicted.
    Traders use a variety of tools to spot reversals, such as momentum and volume indicators or visual cues on charts such as triple tops and bottoms, and head-and-shoulders patterns.9)

    POSITION TRADING

    Position trading is a long-term strategy that may play out over periods of weeks, months or even years. Position traders often base their strategies on long-term macroeconomic trends of different economies. They also typically operate with low levels of leverage and smaller trade sizes with the expectation of possibly profiting on large price movements over a long period of time.
    These traders are more likely to rely on fundamental analysis together with technical indicators to choose their entry and exit levels. This type of trading may require greater levels of patience and stamina from traders, and may not be desirable for those seeking to turn a fast profit in a day-trading situation.10)

    CARRY TRADE

    Carry trade is a unique category of forex trading that seeks to augment gains by taking advantage of interest rate differentials between the countries of currencies being traded.
    Typically, currencies bought and held overnight will pay the trader the interbank interest rate of the country of which the currency was purchased. Carry traders may seek out a currency of a country with a low interest rate in order to buy a currency of a country paying a high interest rate, thus profiting from the difference.
    Traders may use a strategy of trend trading together with carry trade to assure that the differences in currency prices and interest earned complement one another and do not offset one another.11)

    PIVOT POINTS

    Pivot point trading seeks to determine resistance and support levels based on an average of the previous trading session’s high, low and closing prices. This average is considered to help predict the next likely highs and lows, and intraday market reversals.
    Because these averages are widely used in the market, they are considered a healthy gauge for how long a short-term trend may continue, and whether a particular range has been surpassed and a new price trend breakout is occurring.12)

    SUMMARY

    Traders have a wide variety of strategies at their disposal to try to interpret price movements and take advantageous trading positions. Some traders may use a particular approach almost exclusively, while others may employ a variety or hybrid versions of the strategies described above.
    While none is guaranteed to work all of the time, traders may find it useful to familiarise themselves with a number of strategies to build an arsenal of available tools for adapting to changing market conditions.
    Taken from: https://www.fxcm.com/insights/different-types-forex-trading-strategies/

    Total performance of my FX trades

    Some details of my trades:Monthly Change  Total Profits:Welcome all to join me and win together.Refer to this post for steps to copy my trades.http://sgstocksandshares.blogspot.com/2018/08/5-steps-to-copy-trades.html