Talking Stock With The Doc

This Blog has been created for the purpose of sharing my ideas on investing on Bursa Malaysia using Technical Analysis. Stock market investing is a science & TA a scientific tool used by investment professionals. TA also has its sceptics but this is an oportunity for you to follow TA based investing ideas. So welcome to my blog and may you "Live Long And Prosper".

Friday, February 16, 2007

FKLI Doji Evening Star - Correction Again?

Just a short post. I noticed a Doji Evening Star at the close on Thursday. Could be a sign of indecision or correction because it opened with a gap up & then a perfect Doji. Confirmation is only if the futures opens below 1260 & stays below it in the morning. If it opens above this or goes above this then the doji is invalid. It is worth shorting the market with a close position if it goes back above 1260.

Friday, February 09, 2007

The Doc is Back

Hi everyone,

Yes I am still alive & kicking. Been very busy as I left UK in Oct & am now back in KL. The transition was a busy period & I also started on a major contract immediately when I arrived, so that has kept me busy. Unfortunately I am still very busy so will only post occassionally & that too only on the CI & Futures, sorry no time for stocks.

I have been following some of the postings & am very pleasantly surprised that we have a very active Futures Blog here despite my absence & none of the other sites have it. Hahaha someone once asked on the chatbox if I was still alive & Isaac was wondering why I am MIA for so long. Sorry guys just busy with work thats all.

The reason for my posting is I think the market has reached a peak & will probably correct very, very soon if not today (Friday), then it will definitely fall after CNY. The magnitude of the fall is hard to tell but probably it will correct to one of 3 levels (See the 3rd chart):
A - Fibonacci retracement 0f 23.6% i.e. Jan 2007 low of 1,164; or
B - Fibonacci retracement of 38.2% i.e. Dec 2006 peak of 1,103; or worse case scenario;
C - Fibonacci retracement of 50% i.e. Dec 2006 low of 1068 to 1080.

The reasons why I think it will fall are:

  • I see a Hanging Man pattern at a high resistance of 1,242 yesterday. Next resistance is 1,278 but its possible that will not be reached. If it is then that will be the high point.
  • In the Futures Vol has been falling despite index rising - such divergence is indicative of possible correction
  • There is also divergence bet Futures Vol & KLCI Vol, one is falling but the other is rising to record highs. It is not good to have such divergences esp. when we are reaching record highs.
  • There are far too many good reviews & mega predictions by all kinds of analysts recently. 6 months ago no one had a good word abt Bursa, now everyone, his uncle & the monkey are saying such great things. Either everyone was blind & just got back their vision or they are all bullshitting us & talking up the market so that their clients can sell high while all the poor uncles & aunties are jumping in. Generally this has happened at ALL market peaks from the 1980s to now (I am old enough to have seen it all). This is a sure sign that the current bull run is going to take a major correction. I have fallen for the BS before & lost everything I made in the run, so I am now older & wiser.
  • Finally all the uncles & aunties are at the brokerages buying everything in sight (hence the high volumes). When that happens, you can kiss goodbye to the market.

Well here are the charts, but make up your own minds, do your own homework, be very vigilant & careful. Happy Trading & good luck.

Friday, October 13, 2006

Stock Updates - All Positive on the Bursa front

All my stock picks are doing well & should all rise Friday & this coming week. The only one that didn't do as expected is Cymao but as all indicators are still +ve I believe it will also come good.

Cymao is the only stock that didn't do well Thurs with a 4 sen fall. Despite that it is still above the 7-day MAV & all other indicators are still positive. This is just a temporary blip, I expect it to continue rising again after this.

Hiapteck - after 3 days of correction Thurs saw a bullish engulfing candle. Nice formation & all other indicators are still +ve. Needs to break 1.00 to continue its bullish moves. I expect it will do so today.

Leweko is looking very nice indeed. All signs +ve so it should continue its rise.

Permaju also looking good. Indicators all +ve. Resistance is 0.50 & a break above this will be very bullish. Nice stock to buy now.

Priceworth is moving up again as expected after 2 days of correction. It should continue rising strongly as all indicators are looking good. Vol also picked up Thurs.

Sime Engineering undergoing short minor correction but all indicators still +ve. Will resume up moves after minor correction. No change to charts.

Utama broke out of the resistance at 1.23 on higher vol. As expected the stock is showing strong momentum. All indicators are +ve. Next resistance is 1.37 but it must hold above 1.23 for the next 2 sessions, then I am confident 1.37 will be reached. Nice solid stock. BTW RHB is also +ve.

KLCI & Futures - Breakout?

KLCI broke the 970 resistance today on increased vol. All indicators are positive. No sell signal yet even though its on a 6 year high. Next resistance is 984 & after that 1,000. Dow Jones closed up almost 100 points to a new record high. Asian markets will probably respond positively & a rising tide will mean all ships will float higher so KLCI may go for 984. After that we only have one week of trading next week before a 3 day closure of Bursa for the Hari Raya hols & we may see the pullback only after Wed next week. Today should be an up day.

Futures rose even higher than the CI today. All indicators looking better so it may continue rising too with resistance at 990.

Thursday, October 12, 2006

Stock Updates

Leweko - Still rising with mild corrections intraday. All indicators are positive but MACDH looks like it is at a peak. We still cannot call it 'the' peak so unless there is a fall its still positive. Many other timber/plywood stocks have risen especially the bigger blue chips Ta Ann & WTK, the smaller stocks should follow suit as the industry is fundamentally doing well.

Priceworth - despite the big correction after the large white candle on 6 Oct, indicators are still good for PWorth. In fact the correction may have been overdone & it should rise again soon. Its actually looking very good on the indicators. The low volumes are not a bad sign at this stage.

Cymao - is still holding steady. All signals still +ve. It should resume its rise again soon like other timber stocks.

Hiapteck - looks like it is turning weaker. 0.94 & 0.91 are strong supports & if they break then its going to turn bearish. I would sell at the break below 0.91 which is also the mid BB line. On a weekly basis it is still positive so the intermediate trend is positive but short term there is weakness. Long term holders should not sell yet but short term traders have to watch the 0.91-0.94 support & sell on breach. MACDH & DMI still +ve, MAV are also +ve & prices have not even fallen below the 14-day MAV, so we should not panic just bec prices have been falling. Just watch the support levels.

Sime Engineering. Mild correction but its staying above the 1.51 resistance turned support. All indicators are still positive & strong. Volume could be better. Still a hold as upside is still good.

Utama - is still positive. All indicators still ok. 1.23 is a strong resistance. As long as prices do not break below 1.15 Utama will remain strong & can break out of the resistance. Personally I think this is a good stock hold until the M&A issue is sorted out. It should remain quite steady until then.

KLCI & Futures

KLCI - is still quite steady. Volumes are getting better & all indicators are still positive. However if it does not break 970 soon the bulls may get exhausted & give up temporarily. I cannot make a call at the moment so we shall just have to watch it for further signs. Dow Jones slipped slightly but it is still looking steady. Nothing to do but wait.

Futures are slightly weaker than the CI. The 7-day MAV has dropped below the 14-day MAV but prices remain above both these MAV. ADX is getting weaker & DMI is getting flat. H'ever the BB is narrowing & while index is still in the upper channel, something is bound to happen soon. If it narrows further there is a good chance that it may suddenly burst upwards but we cannot forsee what can happen. If it breaks downwards then short the market as the fall will be decisive.

Monday, October 09, 2006

End of Show - Kannaltec & Salcon?

Some stocks have risen exceptionally well the last few weeks but have they reached the end of their run?

Kannaltec is one such stock. It has risen almost 160% in 6 weeks but seems to be highly overbought. The ADX at 68 is already very high & MACDH is also at a high peak. It has also reached its all time high 0.545 which is now a very strong resistance. Can it continue to rise or will it fall? I think it will start to correct from here. All good things must come to an end & this might be it for Kannal. So I rate it a SELL.

Salcon - also may start its reversal. Daily Candlesticks is -ve & the DMI looks like it is going to make a -ve cross. ADX is also starting to move down. MACDH is at a peak. Perhaps with all the new stocks like timber & other old favourites coming back maybe Salcon's run is over. SELL

New Theme Play - Timber Stocks

The recent news about rising demand & prices for plywood & timber products led to a massive jump in prices of many of the stocks in this industry. Fundamentally, it looks like the industry is in for a good run for at least 6 - 12 months & with this stocks will generally rise. I pick a few here which are technically sound as well & use DocTS strategy to select investments.

Cymao - very bullish. All indicators positive - DMI, MACDH, MAV, BB & ADX is strong & rising. Initial resistance at 1.76 & the 2.28. There may be some minor correction after Friday's strong rise, but it should be well absorbed. Strong BUY.

Leweko - has had a good run already rising from 1.20 to 1.54 in the last 2 months. It has also risen above the resistance at 1.50. It was in a minor correction mode over the last few days but should start rising again now. All other signs are positive DMI, MACDH, MAV, BB and the ADX is also strong. BUY

Permaju - is another stock will all positive indicators - DMI & MACDH are +ve & rising. ADX is bullish & strong. Prices are in the upper BB channel & above all the MAV. All positive signs. But Permaju did not rise as strongly as Cymao or Priceworth on Friday & strong resistance at 0.50. If that can be breached then the bullish move will start. Watch with buy above 0.50.

Priceworth - all indicators are positive. DMI is +ve & ADX is strong - bullish momentum is strong. MACDH is rising, +ve sign. Price is in the upper BB channel, in fact it has shot above the upper line on Friday. Price is also above the 7, 14 & 30 day MAV and the short term MAV are above the longer term MAV giving further indication of bullishness. Price also rose above the 0.605 resistance on strong Volume but there is another resistance at 0.67. Pworth is also generally undervalued so further upside is expected. This is a good buy for the timber play. Some correction can be expected (though it may be well absorbed) after Friday's 10% rise but it should continue rising in a bullish run after the correction. BUY