My anticipations of a sell off came true. Now i am seeing Dow broke the major support. Of course the closing on Dow is more important. Hence it is better not to count the chickens before they are hatched. Such support which so many people are eyeing once gives way, i think more downside to come.
It was really tough emotionally when the market showed resiliency. Many a times when the market rebounds, i had the temptations to cut my shorts and turn long. Especially seeing the profits dwindled. From my experience, i knew exactly how to deal with such emotional swings. I think this is my edge. Other than T.A which can be learnt easily, emotion attachments are often the toughest to manage. One has to go through the cycle of losing to winning before one finally can practise that effortlessly. It takes more than raw guts to stick to the trading plan or one's own market opinion.
To speak the truth, i didn't use any wonderful system or secret methods... it is just T.A + money mgmt + risk/reward analysis. I didn't know for sure the market is going to break the support and not going to go into a bull run. What prompted my short positions is how much i will lose if my opinion is wrong. I reckoned, i can handle the risk from the profits i built up since Jan'09. The rule of this game is, when you are right, you win more than when you are wrong. This is money management. Remember how i was wrong early Jan? I cut my losses fast and turned short when the MTL levels were met. I think this is how this game should be played.
During this sideway market, i know which level to determine if the market is bullish and what are the signs. I didn't see any. Rather, i found the actions very familiar, something which i may have experienced in the past. Hence i opted to build short positions while managing my risks. On the hindsight, i could have long at support and sell at pop up to make the profits. But like i have shared before, all the small profits u make betting at support to bounce will be lost in a sudden plunge like this. On some occassion, it can be more than that! How did i know? I was once a victim too. keke
Today i talked to R again. Throughout the conversation, he was justifying to me why Indoagri can go up and why he should be holding on to it. For the record, he longed at 1.30s, and then averaged at 0.39... All the trades were done because he feels it is a good price to trade. Without FA or TA. As his friend, i always advise him not to trade because of his feel, either readup on FA to invest or TA to trade... I thought it is common sense, if you want to be an engineer, u study engineering, if you want to be a doctor, you read medicine. Now if you want to make money from the stock market, you should study how to do it instead of gambling. I have a feeling tomorrow he is going to MSN me and scold me for talking abt him. keke
The other friend i am in constant contact with is Y. People around her discouraged her from trading... and persuade her to invest instead. She even has doubts that if trading really can make money. As a beginner i can understand what she is going through because i have gone down that path before. Well, i consider myself fortunate. Because during my losing years, i saw how my shifus really made money from trading and applying technical analysis. Although i was still learning and the road to success was slow, at least i could draw constant inspirations from them. I had the belief that one day i can also do it. Determination + Faith + Belief! I think this may be what Y is lacking. :P Opps... another person to give me earful tomolo.. keke
Noble and Olam... the commodities rally may be coming to an end? The rising wedge resistance may not be tested afterall... i had actually wanted to short Olam in the 1.50s... however it only manages to trade at 1.51... looks like i may have to pass this trade.
SGX is the new counter i may be eyeing.. the $5 has been frolicking for too long.... too long.... hmm....
Will this break matures into a fantastic downtrend..... i hope so... Dow... pls dun rebound tomolo morning! Let me see a -250 from u!
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