Steel counters on the KLSE are looking overbought and a temporary pullback is likely... Yesterday we saw a large surge in all steel stocks including the smaller ones like leader steel. Trading volume was also up suggesting that the uptrend has just started. However, do not be fooled. There is a good chance that yesterday was a buying climax - at least for the time being. There is no doubt that there is an uptrend but TRY NOT to jump in at this current lofty levels. Wait for a pullback maybe a better choice, in my opinion. Just my 2 cents. Trade cautiously.
Kinsteel - could ease to RN1.37-1.45. Lion Ind - could ease to RM2.30-2.50.
Also note that, steel prices could be on its final leg of its long term uptrend. Be forewarned that steel prices, as a matter of fact, all metal prices could peak sometime in 08/early09.
Thursday, 15 May 2008
Monday, 5 May 2008
KLCI short term Wave count
I believe that the KLCI is currently its Final Wave 5 rally towards the end of the year. The current count is that the index is in its Wave i of its final Wave 5. Where is the index within this Wave i? Here is a chart to show where the KLCI is right now and how I see it going in the coming week. We could see a rally back up to about 1,314-1,320 for Wave v in Wave 3. This count would be incorrect if the KLCI falls back to below 1,256 levels - the high of wave 3, i. (Source for the chart above: Bloomberg)
Friday, 2 May 2008
Losers with a capital L
Here are some of the biggest trading losses ever reported in the media.
1. Nick Leeson and the downfall of Barings Bank. Leeson lost an estimated $1.4bn.
2. John Rusnak and the Yen. Rusnak lost an estimated $691m.
3. Yasuo Hamanaka aka Mr Copper. Hamanaka was a trader at Sumitomo Corp, losing S$2.6bn in copper trades
4. Jerome Kerviel and Societe Generale. He lost more than $7bn speculating in European futures.
Just like in the previous note, Losers begets losers, these so called 'superstars' were doing very well before disaster struck. When these traders started losing, they went out to look for ways to magnifying their bets and try to win back the losses. Apparently, luck has deserted them when they needed it the most.
My 2 cents - It was not that luck has deserted them. It was that they took on too much risk. To seek expectional returns one has to take on equally exceptional risks. There is no magic trick. Investors ought to play great defense and not great offense, i.e. one should manage risks and the returns will take care of themselves.
1. Nick Leeson and the downfall of Barings Bank. Leeson lost an estimated $1.4bn.
2. John Rusnak and the Yen. Rusnak lost an estimated $691m.
3. Yasuo Hamanaka aka Mr Copper. Hamanaka was a trader at Sumitomo Corp, losing S$2.6bn in copper trades
4. Jerome Kerviel and Societe Generale. He lost more than $7bn speculating in European futures.
Just like in the previous note, Losers begets losers, these so called 'superstars' were doing very well before disaster struck. When these traders started losing, they went out to look for ways to magnifying their bets and try to win back the losses. Apparently, luck has deserted them when they needed it the most.
My 2 cents - It was not that luck has deserted them. It was that they took on too much risk. To seek expectional returns one has to take on equally exceptional risks. There is no magic trick. Investors ought to play great defense and not great offense, i.e. one should manage risks and the returns will take care of themselves.
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