Shaky times in the cash market but ecstatic on palm oil

In short, seems like there are so many factors and signs of instability in the markets throughout the world. There's rumors saying the Feds will not taper their stimulus, which then in turn dig a bigger hole again. Back here in Malaysia, rumors has it where foreign funds are withdrawing funds due to the Feds tapering. Well, i seriously am not sure how that could work but my suggestion is act first, before analyzing.

FKLI

It's a very clear bearish divergence between price and MACD-H. Something that i would not miss doing or following what the signals have shown. 25th Oct 2013 has shown a great bearish engulf which has indicated that it's time to turn short. My take is that today there would be another round of retracement as since there are rumors that foreign funds are backing out, that could lead a further plunge. 

FCPO 

FCPO is clearly on a bullish run. With fundamentals of weakening ringgit, bad weather, Haiyan typhoon, FCPO is poised to rise up further. Yesterdays long candle and breached 2600 resistance and also closing at 2599 could see a morning gap up and would be in search for 2630 level and then ultimately will most likely got for 2650, 2670, 2690 and 2700. As of current, with ringgit weakening and rebounds from soy bean oil, could lead CPO to follow the bull pack. 

The Return of the RINGGIT...

SGDMYR

USDMYR

Ringgit is back with a big revenge. :). Clear bearish divergences for both SGDMYR and USDMYR. which also made FCPO volatile with a downward bias overall. Even with good export data of 14% on month, it was not enough for it to push FCPO prices as the ringgit strengthen tremendously. Will have to look at tomorrow's export data to weigh which one is more important as tomorrow is the 20th of the month.

FKLI on the other hand was on steroids due to the FOMC decision on maintaining their "money printing" of USD85bil a month. well, of course that made the Ringgit strengthen since they are "printing" more money. :p. If regionals were to continue this uptrend, 1800 for FKLI may not last long as of today, it is already at 1790ish points.

Hope everyone did change their monies during the crazy uptrend. :)

When the two markets go inverse in direction..

Yes i know, i haven't been writing much in this journey of mine. Been really busy lately. now with my new biz on hand, it really takes alot of time both in the financial trade sector and also the new business i'm in. Well, anyhow, i'll talk about the new biz later. this post will be for the current standing in the two markets FCPO and FKLI.

These few weeks had been really good for me and i've developed different strategies along the way which seems to work. But as always, the saying goes "Be humble, or be humbled!". Hence, my mind is always open for any market changes/movements.

Ok, lets start with FCPO:

It's been bearish eversince two days back on the bearish engulf and a gap down below 2400 today confirms it during the morning session. From the daily chart, there are many signals showing downward signal. MACD lines and MACD-H are all crossed and into the negative zone. ADX also showing that the bears are just starting to take over the bulls which indicates more confirmation on the bears. However, having seen all this, FCPO closed below 2350 and hence the next target support would be 2330-2335. If FCPO does not open strongly down, we may see a rebound. While writing this, crude and soybean oil is also on the bear with both -2.21% and -0.48% and also the ringgit has strengthened against USD and SGD also thus giving more confirmations that FCPO should be heading south.

Now on the FKLI side:

FKLI however has a much rosier picture painted. Signals and candlestick patterns are showing strong rebound upwards with Dow Jones rising +104.38 while writing this. Euro zone also are all very perky with big gap ups. However, what it seemed to be the main factor was that China's industrial production data beats estimates and also concerns over USA-led strike on Syria had eased. Indicator wise is like the total opposite of FCPO with MACD lines crossing up and MACD-H ticking above in the positive region. Candlestick patterns showing very strong bull movements with two tails and a long white candle on 9th Sept 2013. ADX also showing that the bulls are taking over to rule the market. However, on the local side, Malaysia had been downgraded by Fitch Ratings which may or may not come back and loom over the market. If we have measurable steps from the govt, then i believe the market will continue to bull but if not, then it will be tough to see the bulls go any further. Nevertheless, as of now, from the chart it seems that bulls had a big major upper-hand. The strengthening of the ringgit probably signaled the market on better buying power which in turn better development. Well, i hope that would be true but sometimes it's tough to see that when we are constantly being lied to by our very own so called "leaders". As of immediate support would be around 1755-1757 and the next resistance would be 1780. breaking any of these will definitely follow by the movement to that direction but on an overall, bulls are still gonna reign for a while.

What it takes to profit from it. (Part 2)

Warren Buffett, the world’s richest and most successful investor for over 50 years follows two very simple, yet profound rules:

Rule #1: Don’t Lose Money

And

Rule #2: Don’t Forget Rule #1!

His two rules basically imply that it is imperative for everyone not to make any sort of silly investment mistakes that may cause you to take on high risks and lose money unnecessarily. In the case of bad stock selection or the wrong market timing, you can easily to lose up to 20 percent of your investment capital within a few short months. To recover your losses, you need to make returns of at least 25% on your remaining capital which may easily take you two years or longer to achieve. Take a look below:

                             

Loss -20%

RM100,000        ------------>     RM80,000

                             

Gain +25%

RM80,000          ------------>     RM100,000

It takes you over two years to just break-even in this example. After two years, even though you have recouped losses, you have lost precious time. Money is something that comes and goes. Whereas when time is lost, it is lost forever!

These are some of the advises that i discovered and also told about during my early years of investment. Up to today, i still hold these advises strongly in me. Hence, here are some of these toxic investment mistakes which you must avoid at all costs:

#1: You take financial advice from people who sell investment products, not successful investors. The right or wrong advice will have a big impact on both your current and future financial health. Many beginners start off by listening to friends and family members. They get free advice on what works and how to succeed. What they may not realise is that free advice can be very expensive.

#2: You do not have any written financial goals with regards to the number of properties, how much passive income, how much bank borrowing or good debts for property investments, what is your asset allocation model, what investment strategies you want to apply, etc. If you do not have any firm idea, you will not know which direction to head.

#3: Young people (i.e. less than 35 years old) focus the bulk of their time, energy and effort on investments when their investment capital is too little to have any sort of meaningful impact. Instead, they should be focusing on maximising their earning potential as they are at their prime earning age.

#4: You invest your hard earned money in high return investment scams and lose everything. Some people even lose a hundred percent or more in failed business ventures. In my opinion, taking business risks is acceptable. If you do not try, you will never know. As long as you plan to fail cheap and fail fast, it is worth taking a calculated risk.

#5: You buy investment funds and take risks hoping to make average returns of 7-9% per annum. Instead, you can pre-pay your car or housing loans and enjoy a guaranteed savings of 4-6% per annum with absolutely no risks! You should only invest provided there are opportunities where you can make double or even triple the amount you get by saving with minimal risks.

#6: Mistake number five automatically implies that if you are going to have any sort of loans till the day you retire, you cannot invest in investment funds till the day you retire! It is a fact that most Malaysians are expected to have some sort of loan till the day they retire.

#7: To diversify and reduce risks, you buy complex (e.g. structured, capital guaranteed, etc) investment funds that you do not quite understand. Many people even start diversifying when they are still young with their small investment capital. Warren Buffett likened the word ‘diversification’ to “de-worsification’. As long as you know what you are doing, it is not necessary to diversify.

#8: These investments funds have high sales charges of 3-5%. In fact you can buy similar funds with entry costs less than 0.6 percent! After all, is not a dollar saved equal to a dollar earned?

#9: You buy various products from banks and make them rich when it makes greater sense to buy bank shares and make yourself richer!

#10: You are not investing in low risks commercial properties giving high returns of over eight percent per annum with low entry costs. You can actually do so from as little as RM1,000 and enjoy absolutely no property or tenant management problems!

#11: Your first investment property is a landed house giving negative cashflow. This will limit the number of properties you can buy. For beginners, it is advisable to start off with apartments or condominiums as it is easy to achieve zero or positive cashflow every month.

#12: When you get married, you buy a dream home right away! Instead, it makes more sense to buy an investment property and rent a home for the first 10 to 15 years of your married life. As you may not have settled down career-wise and your young family needs changes, renting will give you the flexibility to move as and when the need arises.

#13: You buy a property or a home which you could not financially afford yet. Being young, you think that given time, this property will become affordable as your earnings increases due to promotion, salary increments, etc.

#14: You buy costly high-end residential properties. Instead you could have invested in commercial properties which give the best of both rental returns and capital appreciation. This is applicable if you have a budget of over RM1.5 million for real estate investments.

#15: You buy ‘cheap’ properties when it is a fact of life that ‘cheap things are never good’ and ‘good things are never cheap’! It is always worthwhile to pay a premium and buy the best properties in great locations.

#16: You purchase commercial properties in areas where the neighbourhood’s purchasing power is low. How well your commercial property does will depend on how well your tenant is able to make profits. A neighbourhood with low purchasing power will not do well compared to a richer neighbourhood.

#17: You purchase a dream retirement home when you are still 30 years away from retirement. As your future lifestyle, likes and dislikes will inevitably change, it is advisable to only think of buying a retirement home when you are only a few years away. For all you know, you may prefer to retire in another country!

#18: Your investments are unable to give decent returns to enable you to outperform your personal inflation rate of 6-10% per annum. Your family’s inflation rate will depend on you, your spouse and your children’s consumption patterns and lifestyle!

#19: You work hard and save to buy one investment property every few years. Whereas savvy investors creatively buy one property a year or even one every few months with little or no money down!!

#20: Your financial goal is to retire debt-free at age 65. On the other hand, smart investors aim to retire at age 45 or earlier by accumulating good debts of at least RM3 million via property investments!

#21: You wrongly focus on hitting a certain net worth instead of generating passive income. For example, when you retire debt-free, you must have RM1.8 million in fixed deposit at two percent per annum, in order to get RM3,000 a month for living expenses. Instead, you can actually get the same passive income by investing RM500,000 in properties!

No matter how hard you work or save, committing any of these 22 toxic investment mistakes will prevent you being Financially Free.

What it takes to profit from it.

I think it's just a human nature that people will always want the easy way out. They want the next best thing in the quickest way possible. There are sayings that goes, "good things comes with a price" or "good things will take time to come". Now, I don't know how to express in words that those sayings are utterly true. People are not willing to spend the effort and time to pursue the challenging (and most of the time spirit breaking) route to success but always want success to be quick. Think about it, one can spend say 3 years in a university to get a job out there. Don't get me wrong but that's also a kind of success! You rough it through university, study hard, late hours on projects, assignments and worse during semester examinations and tests.

Now, for that analogy of roughing through Universities, you worked hard and etc and one probably get a decent paying job (bolding of the word job is on purpose). That's the funny thing about it. People do not mind working their asses off during university for a job but they do not even want to spend 1 year (could be less) in pursuing their success of financial freedom. It's really ironic. I keep hearing people telling me "it's tough, you won't get to see any money for the first 3 years". Well, i was thinking, did anyone see any money during their 3 years in university? Maybe some did and they did odd part time jobs but that's not the point. 3 years is just an example as it depends on how big one's dream and purpose to succeed is. The bigger the dream the more time and effort is required. Bill Gates slept in his office everyday and see where is he now? Everyday thinking of making better softwares from that computer.

Alright, now straight to the point of what some people had asked me about investments. It's interesting that 90% of them are the ones waiting for some kind of "magical" advice and they can win big. To be fair, I was one of that kind at a point of time but thank our heavenly father that i snapped out of it quick. Hence for this post, some asked me what does it take to trade futures or be in the stock market. In my mind, i believe it is not only in the futures market but it ANY financial market. I literally mean ANY because be it from futures market, options market, equities market, properties market, bonds, etf's and so on that these 5 basic "must-have" are a must in anyone. In my own personal opinion, these 5 basics are so simple but yet extremely and utterly hard to achieve. What are they? Here goes:

1) Emotions management

Trust me when i say that i learnt this the hard way and I put it right at the top of the 5 basics. I'll use a trade to enhance my analogy here:

Ok, lets say that one takes a position to go long, and has a stop 10 points away. Market moved downwards and it hit his stop. For the FKLI, 1 point = RM50. So, 10 points is RM500.

So, one may say, "ok, that's the plan i followed. It's ok. i'll try again". So, market went lower, and one bought at a lower price and again placing a stop 10 points lower. Market went further down and hit his stop again. Another 10 points gone. That's already RM1000 in 2 trades.

Later on, there seemed to be a buying opportunity again as it went lower but because your emotions had shaken, confidence shattered. Hence one will say, "crap, let us see how the market goes first since i just lost so much". Who knew, the market rebounded and went up 30 points. That could have covered the the loss and even earned another extra 10 points! Hence, that person will probably be controlled by their emotions and it is two emotions that will always bring a downfall to that person which are fear and greed. Fear because after several losses, they fear of losing more and missed the opportunity and greed when one wants the unachievable by the market and do not accept what the market is doing (or basically think that he is right). Both these emotions will kill an investor/trader as quick as he entered.

So how to overcome it? It's actually quite simple. Plan your trade and trade your plan. Yes. it's that simple. Too simple until it becomes extremely difficult because of emotions that will cloud your judgement

2) Leveraging can make or break a person

Yup, we live in a world of leveraging now. Leveraging here in layman terms means "small capital but earn big money". Hey, sounds good right? In fact, most of what we do now is on leverage. Opening up a business, one will probably get a financial support from the bank. That's a leverage on OPM (Other People's Money). You borrow money from the bank to buy a car or a house, that's leverage too.

In the futures world, the leverage can go up to more than 15x of your capital. For example in the FKLI, 1 point = RM50. Hence if you take a position at 1750 index points, it means 1750 x 50 = RM87500.
That's way too expensive for one to trade right? Hence, futures here goes by contracts and per contract is
only RM5000. So, you're leveraging 17.5x of your contract capital!

Now, not many people realize this but leverage can make or break you. If not handled carefully, it can kill you before you even know what's happening and it also can lift you up so fast that you thought are in heaven already. So, using RM5000, one can trade the FKLI market and lets say you earned 20 points from the FKLI market, that is RM1000 profit which also means it is 20% profit in probably a day or so. That's extremely wonderful as which investment vehicle else can give this kind of profit? However, like i mentioned, leverage can make or break you. If it can make you, it certainly can break you too.What if you lost 20 points? That is a 20% loss in your account of RM5000.

Then, it boils down to emotions again. If you have loss RM1000, emotions will kick in and say "lets earn back that loss by adding more contracts". Instead of one, you now trade two contracts. That's RM10000 and you will be leveraging RM50 x 2 contracts x 1750 index points (using 1750 points as an example). That will give you RM175000 that you're leveraging and not only that if you are down by 20 points that would be RM2000. So, adding from the previous loss of RM1000 + RM2000 = RM3000. RM3000 of RM5000 capital is 60% loss of your capital! That's like more than half of your capital gone!

Hence, leverage at a pace that you are comfortable with. Do not over leverage.

3) Only add positions when you're profiting 

I guess i've already explained this on point 2). If you add positions/contracts when you're on a losing side, you can lose money so fast that you won't even know what happened. Hence, you only can add more positions when you are on a winning side. This is a common downfall for traders/investors because they want to earn as much money as fast as they can!

4) The TREND is your FRIEND

Easy said, easy heard. But why are there many (I was one of them last time) who looses still? People love to think that they are right and they want to "tell" the market what to do but they do not realize is that, that person is just one person and the market is millions of people. So if lets say in a crowd, which one has the louder cry? Is it you or is it the crowd?

So, what can we see from here? In simple words, "let the market lead your decision and not the other way round.". The main thing why this is so hard to follow is human ego (yes, another emotion). Here is how it works:

You do your charting analysis and also fundamentals. You see that it will continue to go long. Hence, you went long. Market dropped and you tell yourself and even some other people that  "don't worry, it will pick up. My trading software strategy is perfect as i've backtested it 10 years behind". The market continued to drop further but because of your ego and what you told yourself and also other people, you will not want to budge from your decision. Market continued to punish you further and further up to the point that you can't bear it any further and you cut your position at a big loss. Then, after that, the market suddenly rebounded and went even higher than your position. That time i guarantee you are going to be so bloody frustrated and you will not even think properly and you will probably blame everything under the sun.

There is a saying, "be humble or be humbled!". When you get egoistic because of wins, that is when the market will punish you big time.

5) Practice makes perfect

I guess this works for anything we do now. The more we practice on something, the better one will become. Like what Bruce Lee said "I will not fear of someone who learns a thousand kicks but will fear someone who learns a kick a thousand times". Hence, that's exactly it. Keep practicing on your plan. Give it time for it to develop.

Yes, some will say they can paper trade and try their plan first but the only problem with this is paper trading does not involve emotions. It's when you use real money into your trades, you will feel that pressure so great that your emotions comes in and take over. Hence that is why emotions management is the first and most important point on this 5 basic points. In futures trading, there is no other way to learn than getting your hands dirty in it. Which means using real money to trade. One can always start small before going in bigger.

As my personal view, one should learn how to earn money from their own local market first before doing overseas markets where the sharks are bigger and the wolves are bigger in overseas market. I always tell myself this, "if you can't win from your own home ground, do you expect to win on your opponents turf? :)

FCPO highly possible for further correction....

YES! I know i have not been posting much but had been really busy with stuff. Oh well, since I won't be trading tomorrow (due to shift of brokerage company) and hence, need to take a day's break. Hopefully the next brokerage company I'm joining will give better "luck" than the current one. haha.. :)

Anyway, those who have short positions from yesterday or today, will sizable treats for tomorrow. Good for those who went short. My personal view, the drop should extend further tomorrow. Best book profits by tomorrow as this may just be a temporary correction.

For those who spotted it since yesterday, bravo and kudos to you as definitely, you would have booked easily 30-40 points profit or more easily. Here's why my personal view has the drop extending further tomorrow:

Yesterday's candle was the big sign for reversal/correction. Notice yesterday's candle gapped up, broke 2400 resistance and went right to 2420 resistance but at the end of the day, formed a "Gravestone Doji" marking that sellers came back with a big force. Supporting that was also the volume was at its highest point for yesterday within the bell curve of the MACD-H.

Today, the market closed with an inverted hammer head candle which indicates selling pressure has continued and firming for more selling. Although the volume was not as much as yesterday and because of this, it showed a lower tick on the MACD-H which indicates lower interest in buyers to continue pushing.

On the fundamental side, Ringgit has strengthen abit from yesterday's drop and also soy bean oil took a massive dive of 2% yesterday and at of current point of time, it is still dropping by 0.25%. However, as mentioned earlier, this may be just temporary as the Ramadan month coming on July will incite demands for Palm Oil from Pakistan and other Islam countries.

Hence, my own personal view, selling pressure should extend tomorrow. Target drop should be 2350. Closing for the day below 2350 for tomorrow, will result to 2330 being the next target. 

Is it yourself? or was it engraved by others..

This is not new. How many of you are there, thinking of doing something that you really want to do but you were stopped by:

1) your own fear
2) your own mind
3) other people telling you, you can't do it
4) people heckling you that it's dumb of you to do it

I've encountered all of them. I feared so much to do what i'm passionate about is because i have commitments. I mean, WHO DOESN'T? Parents, gf, car, dog, cat and etc...(please fill up the rest if i missed them out). But are you going to let them stop you from what you really want to do? For the first two points, (points 1 and 2 above) these are the obstacles that one will encounter. I put them top 2 because those, are the ones you have to beat first and they are normally the toughest. Many people fear that if they drop what they are doing now, and are afraid that if they did not make it on what they are passionate in, they are stuck in the middle. I don't deny that it may or most likely WILL happen. It has happened to me many many times within this 10 months that i'm self-employed. Some can be even spirit breaking, exhausting and stress.

However, let me stress one thing here. Your mind controls your body and hence controls your actions. If you say that, "i can't do it, it's just insanely difficult and there is no guarantee of making it". By saying that, you have given up almost entirely on your dream/passion. Now, do you see it? Nobody did anything to you. YOU just defeated yourself even before you can even start it. Hence, if you say u can't do it, most likely you are definitely not likely to be able to make it because you already set your mind that you won't be able to make it. In the movie "The Secret", they stressed on being positive is because your mind is the attraction of what you think. So, if you have positive thinking, you will attract positive results and the opposite results for the negative thinking. So, that's battle lost straight up even before starting doing anything. Ask yourself this, is that what you really want? To defeat yourself?

Points 3) and 4) are also very typical. I'm pretty sure that you have someone telling you that "It's tough" or "It's impossible for you" or "you can't make it, you're out of your league". Normally, i'll just show a middle finger to these people but nah, why waste my energy right? :). You see, there is a reason for everything and the reason why people do this, is probably that they themselves have not tried it and heard bad things about it OR they couldn't do it themselves and they want to pull you down to the same level as they are. It's plain simple. Even family members (mom, dad, brother, sister, cousin, ah ma...and etc..) will do the same. They are definitely not excluded in this. If you have read my very first post in this blog, i mentioned my mom was one of the biggest demotivator in what i am currently pursuing. She says it's risky, dangerous and will lose everything and she started bringing out failed cases of some family members, friends and friend's children and etc. I don't deny the dangers are there, but it's just like driving an F1 car. You need to have a special license to drive an F1 car before you can even drive it. If you're just getting a normal car license and you drive an F1 car, most likely than not, you'll probably crash and may cost you your life. Same thing here, it's risky to do business, risky to invest, risky to etc....it's risky, if you DO NOT KNOW WHAT YOUR ARE DOING. Same thing like the F1 car, your normal driving license teaches you the normal standard cars driving method with the clutch and gear and so on. F1 cars have gears on the steering wheel and it is a much x1000000000 more powerful car than what you get outside. So, if you don't even know where the clutch is for an F1 car, what do you think you will get? That's right...CRASH! So, what i'm trying to say here is, if you do not have education on it, of course you will lose but if you're well equipped with the knowledge and the skills, then risks are eliminated. What more, maybe you can even control it to your liking.

Now, humans are people with full of emotions and one very common emotion one will have is JEALOUSY. They may see you doing something that they like too but they can't do it themselves and they do not like it that you are proceeding with what they like, they start spreading stupid stories on you or maybe on what you're doing. If you get affected by that, you've lost. I've turned all these negative stories on what i'm doing now from other people into fuel for motivation. And boy, was it good. I've been told by one friend that "just stick to tennis and girls". Of course i felt pissed, afterall i'm only human but what i did was i took his words, put it under "fuel-for-motivation" in my mind and boy, it worked out good. It won't be easy but trust me on this, if you are able to do it, you will see super mind bogging results on this. In the movie "The pursuit for happyness" which was acted by Will Smith and his son, there was a part where his son was just playing around with the basket ball near his rented apartment. His son said "i'm going pro dad! i'm going pro!". Will Smith answered his son "well, you know, when i was a kid i was just average in this. So, you'll probably be the same like me. I don't want you to just go around shooting basketball into the net, alright?". His son felt disappointed but agreed reluctantly. Will Smith saw the disappointed face in his son and said "Hey, don't ever let anybody tell you...you can't do something alright? Not even me. You got a dream, you got to protect it. People can't do something themselves, they wanna tell you you can't do it. If you want something, go get it. Period!"

That's exactly it. Never let anybody tell you you can't do it because this is your own dream. You control whether it will make it or not. Not them. Presevere, don't quit, don't give up no matter how beaten down you are in pursuing your passion/dream. You will fall many many many times before you reach there. I know, coz i fell many times and sometimes takes a while to recover.

So, you've got a passion, just go for it. Don't let points 1,2,3 and 4 stop you. But points 1 and 2 are the hardest as it comes from your own goodself. Beat that and then you have to fight points 3 and 4 from the outside but that would be easier compared to points 1 and 2.

You only live once. Give yourself a chance and go for it! :)

A rocket can only go up if there is enough fuel..but what happens when the fuel finishes?

It's been really crazy in the market for the past 2 weeks and i believed that the market was "tailored" in it's crazy 2 week rally. 2 big announcements (dissolution of parliament and polling date) but erased and dished aside. With that kind of money, there is only one place that comes from it when investors were mostly sidelined. Yes you got it, our ruling govt, BN/UMNO. They are the ones holding vast majorities of shares of the 30 counters of KLCI. They wanted to make themselves look good right even near elections. Well, they have to or else they'll be in hot soup! It was mentioned in all medias in Malaysia that "foreign funds" were buying up KLCI shares since last week. Is it REALLY foreign funds or are they "stashed aside" corruption cash of these BN/UMNO cronies or what not the entire party outside Malaysia and bringing it back in as "foreign funds"? My bets are definitely that.

However, regional news are also giving this bearish reversal some support on further selling off with US consumer data dropped and worst in 9 months. Not forgetting Euro fears on Cyprus. People are wondering how are they going to cough out 6 billion for the debt deal.

Anyhow, as much as the rocket goes up, it's time for it to come down and today, it had shown a pretty significant or what not, a pretty convincing reversal pattern. Chart shows it.

FKLI Daily Chart

Yellow region shows the sharp and drastic push rally which i call it "BN Supported rally". However, today's candlestick shows a long hammer head candlestick with a roughly significant tail. What's most that today's candle had practically engulfed yesterday's bulls, covered the gap and also closed lower in to the day before yesterday's candle.

Today's volume was higher than the past few days on the drop indicating that people are quickly selling off their positions. MACD-H showing a shorter histogram today which may make the reversal more convincing. MACD lines still look pretty bullish but it seems that it's curving down now.

Force Index showing shallower peaks which is a bearish divergence to price as on each peak, the prices go higher still. Each peak, represent a higher price. With force index showing that it's below 0 line and closed there, shows a sign of weakness to

I seldom use RSI for my trades but i used it today to see if they are overly bought and fair enough, it showed a touch on the 70 line and then resisted all the way down.

Next monday will determine whether it is a reversal or not. What i am suspecting will happen on monday is that it will open with a gap down. With this gap down and the price opens and closes below today's candlestick, will confirm the reversal.

It's time the bears take over as it should have. Just that we had some so called "hot money" or "foreign funds" coming in and buy the index upwards. Hence, if it's within god's will, this bull will go on until elections. Having said that, if BN wins, just sell off everything you have and go LONG and if PR wins, just go the opposite way. :)

The passion within...

Seriously people, think about it. What's that passion in yourself that you really want. Take away all the commitments or "i must do this if not.." or "i can't, because...". Take away ALL that and be utterly and truthfully honest with yourself. What is it that you have always wanted to do, what was that dream or passion that when you did it or even thinking to do it, that made you smile?

It's sad to see people, living their lives within a "pay-cheque". Of course, there is definitely nothing wrong with that IF AND ONLY IF one enjoys that and makes him/her smile. I've been through the "pay-cheque" life where i just have to eagerly wait for my pay-cheque to be given to be at the end of the month. I lived in fear not knowing when will i be out of a job. Never really liked my job that time but i just had to stick with it.
But seriously, every successful person out there says the same thing. "Follow your heart" or "Find your passion and follow it". Steve Jobs said the same thing and he made Apple one of the richest company in this planet. Hence, there has to be truth behind all these right? But why many don't embrace and nurture it from within and build on it? That's why, there are only a few successful people but many many are just followers and what not, quitters.

According to Robert Kiyosaki, telling your own children to "study hard and get a good job" is the riskiest thing that a parent can tell a child. I second that without a doubt. Remember i mentioned in my posts earlier on, employment rate now has dropped. Look at europe and the US. Just last week, US posted its jobless claims that risen more than expected. So, is a job safe now a days? At current times, there is no such thing as "i'll keep my employees up to their retirement age of 60 or 65". No such thing now. If the company is not doing well, they will definitely axe off people and guess what, it starts from the above average positions like managers. Simply because their pay is high and they are not really doing anything to seriously make the company moving. Hence, its the ones who are on top (basically the owners or share holders of the company) and also the operation levels. Anything in between are axed. So, is a job REALLY safe now? One can climb to become a manager or so on and that time, probably that person has many commitments and is probably at the age of, probably 40 (give and take). At that age, getting another job is going to be much harder and the problem is, that person had been rooted with what he/she had been working. Hence, it's like a dead end for these people.

So with all these, it's really important to follow your passion and never let anyone tell you that you can't do it. Just like what Will Smith told his son in the movie called "The Pursuit of Happyness". It was an excellent movie beyond doubt and i 100% recommend that movie to people who are aspiring to work towards their passion.

Chart time...

I had several strong requests for me to post some charts on FKLI (Futures KL Index) market and a little "insight" about it. Initially, this blog was mainly supposed to be just more on what my views and thoughts throughout this journey of mine. Anyhow, due to those strong requests, i shall pop in a chart or two from time to time on the futures market in Malaysia.

Now again, i always stress in "doing your own analysis" is because views are just views. They are not the "holy grail" for investments. Even the so-called-experts in the financial world tend to be wrong too. Hence, in other words, learn the trade or walk. A mentor of mine had always mentioned that never depend on tips or views as they will in time confuse you. Learn the trade, know yourself, plan your strategy and go for it. That's all it is.

Ok, as of today, 1st of April 2013, the KLCI and FKLI had really been playing tricks onto investors and traders. Fundamentally, as we all know, we have the elections around the corner. It's just a matter of time and everyone is actually waiting for our "expired" PM to announce when the parliament would be dissolved. It seems to be taking forever! This had made shorters curse like mad as elections should be held soon already. However, till now, parliament is yet to be dissolved. Hence, if we take away that factor of the elections, KLCI and FKLI are still on the strong note. Refer to FKLI Daily chart below.

FKLI Daily Chart as of 1st April 2013

From the technical point of view, it could be a start of a bear reversal after a strong bullish move. For the past 3 candlesticks, showing a doji with the other two small hammer and a gap down on today's candle, it has showed that bears are starting to come in but also with caution. To me, both bulls and bears are trading with caution but those bears that has big capitals are probably not too worried as they have the staying power. Today's movement was a little frustrating for the bears as it dropped pretty sharp right to 1652 but it rebounded all the way up and closed in the green territory at 1664.5 leaving a long shadow again which also shows that the FKLI is still strongly supported from any sharp declines. Candlesticks are still trading above 100EMA which shows that bulls may still be in power.

The beige region shows that the FKLI is doing a very very obvious and big head and shoulders pattern. Something which i have talked about that would form especially near elections in my previous post. Prices and MACD-H are tracing a bearish divergence which can be very suspicious if FKLI continues rising with a shorter MACD-H. Today, MACD-H traced a lower/red histogram which shows that volume and price action towards the bulls are wearing down. Force index dipped slightly below the 0 line showing that bears may continue to reign. 

Despite all these, FKLI did close 78.6% retracement of the fibonacci which was 1663.5. If FKLI opens with a gap up tomorrow, we may be looking for resistance 1678 to be re-tested again. And as earlier mentioned, today's candle showed a small hammer head pattern with a long tail which may show that bulls are still supporting the fall and may continue to push up. 

As i have mentioned in previous post, i am still pretty much bearish and hence, I would say that to short at resistances or short at strength. If FKLI manages to close above 1678 for the day, then we shall see 1690-1700 to be retested again despite the so called "elections" which are coming. If to trade at the bulls side, i would say, keep it intraday as much as possible. Bears, if you're not confident for the next day movement, do intraday too but if positions are taken near big resistances, i believe it should still be fine to hold but do have a stop loss no matter what.