Trading Q&A

I'm so sorry guys for not attending to this site for a long time. After coming back from Genting, I was busy catching up with my work and most importantly, my trades!!! I thought I saw opportunities and started to focus on my trading instead. This is also one reason why you should digest my growmoney blog on a daily basis. I'm a local and i make mistakes as well as profits. Let's learn together!

22 Dec 05, 22:03sonjoy: can i say that your quick pick list does not meet your "chart formation+vol= breakout" strategy?

Ans: Yes sonjoy, i provided the list for those who wish to know what are the stocks to look out for in my opinion.

20 Dec 05, 20:26Archer: at what time do u do u read all this questions and answer them....?

Ans: Archer. I tried my best to do it whenever i'm free or when the market is quiet. When you don't hear from me, I must be busy trading. : ) But minimum will be on a weekly basis.

20 Dec 05, 20:14Archer: what book should one get fimilar with to understand ur breakout method...ur one book..maybe "Bible" for breakout that u would say " I swear by it !" , that I could read for understanding ur method

Ans: I wish it's that simple. It's a combination of 3 books which i felt most useful and it's in my Growmoney Shop. You can either get locally or thru amazon. Do not focus on trading system. Psychology is the most important! It's the driving force behind any trading system!

20 Dec 05, 20:11Archer: can u expain/elaborate with charts what is higher high higher low..er..something like that...that which u look out for when determining a breakout?

Ans: You can see my charts at growmoney blog. Normally I will mention. but to put it in words, it's a "W" with the right side of the "V" higher than the previous one.

19 Dec 05, 23:55Her: Thanks for the reply, Decipher. But what is chart formation? Sorry, I'm really very new to this.*blur*

Ans: Her, I can't posibly list all chart formations here without diagrams. However you can do a google search for it. I prefer to explain why chart formation is important to me. Chart formation reflects the buying and selling of the stock. Consolidation....distribution... a proper chart formation will gives me more confidence to buy it.

19 Dec 05, 23:47Archer: i notice u use RSI more often than MACD or stochastic..is this true..what indicators do u rely on for breakout?

Ans: I use RSI alot however I also used MacD Histogram on the weekly chart to determine the major trend. As for Stochastics, I am not using anymore as my current breakout system does not require it.

19 Dec 05, 23:43Archer: are u refering to cup and handle and double bottom as chart formation ? what other (list of ) formation are there to look out for?

Ans: I basically look out for every chart formations I knew. The list is very comprehensive. You may think i'm boasting. But it's the truth, I been reading charts for the past 2 years daily and somehow all the practises had given me the ability to spot formation easily today.

19 Dec 05, 23:02Archer: Thanks for the prompt reply. I need a lot of 'hand holding' !So, can u elaborate ur method with some illustrations please? U mentioned about Cosco . now 2.17 .when break out?

Ans: Cosco is behaving oddly and currently had rebounded off it's 200 moving average at 2.08 support. I intend to write a book on what work for me. Hence I will not elaorate too much online now. :P

19 Dec 05, 17:07Archer: Newbie to this field. Eager to learn how to trade shares. Wants to know how to spot breakout . How did u arrive at the list in the quick pick? Thnx

Ans: There are many forms of breakouts. While I did not learn about the rest, the 2 breakouts i studied in details are as follows:

a) Breakout of 20 days high, 50 days high.

b) Breakout in terms of price difference as compared to previous session with volume more than 25% or 50%. The % is determined by you as you grew more experienced and tune it to capture more accurate breakouts.

19 Dec 05, 13:08sonjoy: The X-pert from Chartnexus not easy to use.

Ans: Please contact the support team from Chartnexus. They are a friendly bunch of people and will be happy to help.

19 Dec 05, 11:45Her: Decpher! How do you spot a breakout before it breaks out? I still cannot figure it out! Help! Thanks!

Ans: I do not spot a breakout before it happens. Normally, i will spot it after it has done so or sometime right before the market close at 5pm. For me, Chart formation + good volume == breakout!

Ladies and Gentlemen,

Thanks for posting your questions and thus making this ite very interactive. I appreciate it. : )

I notice recently alot of you have been asking me which stocks can or cannot buy. It's illegal for me to provide buy and sell call. MAS will catch me! : ) So all i can do is provide you what I see and I won't issue buy/sell comment. I hope you can understand.

If you have no ideas what to buy, you may refer to my growmoney blog where I chart what I thought is intereseting for you to consider.

9 Dec 05, 21:13darius: How much percentage of your equity do you risk when you trade?

Ans: As I am a salaried employee, I set aside an amount to risk per month. It is part of my expenses for that month. Hence if i lose that amount, I can take heart that i still save a part of my salary in the bank thus my savings won't be affected if i lost in the market. Inshort, I risk an amount that is part of my expenses. If I lost, I will have less restaurants and more kopi tiams. No shopping, no movies, stay at home to read up on trading and sad to say, no pubbing or clubbing!

9 Dec 05, 21:12darius: What indicators do you use to confirm a trend and how do yoou use it. Can you give an illustration?

Ans: I use the simple higher highs higher lows. This is easy to spot on the chart. You can refer to growmoney blog where there are many charts i drew from June '05 till now.

8 Dec 05, 23:11mb: Where can I learn how to read the charts? is there any books on it? thanks

Ans: You can visit my Decipher shop located on the left panel to see the 3 books i highly recommend.

8 Dec 05, 19:38Sianzsianz: I am thinking of putting my money in either Sun Business or Seksun for mid-term? Are the two counters worth the investment, Decipher?

Ans: I am not an expert in fundamental analysis. Trading base on volume and price actions is my forte. Hence For the 2 counters you mentioned, I have no idea man. Both are pretty illiquid stocks.

8 Dec 05, 18:24Lull: Hi Decipher, I have been stuck with Hyflux shares and Biosensors. I came to reality and now decided to cut my loss. In your opinion whats the best time to sell?bioS@1.17 HyF@2.77

Ans: Hmm...this is tricky...maybe you can consider after the yearend rally to make up some loss ground? Because I dun see our market going south yet.

8 Dec 05, 15:42LBK: Hi, decipher, what do you see the KEPPEL CORP, can buy?

Ans: Keppel Corp, hasn't appear on my analysis report yet. But you can hear it first at growmoney blog when it happens. : )

7 Dec 05, 19:12Sianzsianz: I bought ChinaEnersave at high 18.5 cts and till date it has dropped to 12cts!! I have hold on to it for 01 yr or so. It is better to sell off and go for other stocks ?

Ans: I had encountered the same situation and taken a decision that changed my life. Everyone must make their own decision, I am not qualified to teach you what to do. But you may want to read this http://growmoney.blogspot.com/2005/08/hgm-dumpeddecipher-reborned.html : )

7 Dec 05, 19:10Sianzsianz: Hi, Decipher, need your help to analyse this stock - ChinaEnersave?

Ans: Firstly you have to decide if you are going to trade it or invest in it. I won't trade this counter because of it's low volume. If you want to invest, you must find out the fundamentals of the company which is not easy. To be honest, the volume is low and it is proned to be manipulated hence i siam this type of counter.

7 Dec 05, 14:07Her: Decipher, there is a lot of sell down for Metro but how come the price keeps going up?

Ans: Please visit http://photos1.blogger.com/blogger/1689/1183/1600/2006Jan-MetroHldg-800x415.0.png for why it is going up. : )

7 Dec 05, 11:27Vivien: Appreciate if you could explain what is "outperform""Overweight" "Unerweight" or" neutreul" given by the broking houses. This is to buy or sell?Dont understand.Thank you

Ans: I have to admit, i don't know the anwser! haha You may want to check the meanings at www.investopedia.com

7 Dec 05, 00:57binatang: From your experience what TA indicators do you find the most useful forma practical standpoint? I'm new to TA & I'm getting confused by the vast variety of indicators out there

Ans: I like breakout chart formations with RSI. Every indicator has it's own merits. But I prefer MAcd Histogram, RSI, moving averages mostly.

6 Dec 05, 22:48Her: alamak.My msg got cut off. Anyway,I wanna ask u what "good volume" is to determine a breakout. Thanks in advance.

Ans: Good volume will be typically 25% over the average of 14 days volume.

So far there isn't any youngster trying to learn investing or trading ah? Decipher kor kor willing to teach leh. Better start young coz' this is also the time when you can afford to lose and restart. C'mon!

6 Dec 05, 17:39
Her: Hi Decipher! WHat do you mean by a shooting star and how do you spot a shooting star? Btw, I think ur blog is great. I'm glad I bumped into it.

Ans: I'm so happy you like the service i trying so hard to share! Ok, shooting star is a japanese candlesticks formation. During the intra-day, it reaches a high and then towards the end of the day closes near the low of the day forming a very long upper shadow. This shows that the late selling strength keep the price near to the day low. Bearish signal.


6 Dec 05, 17:35
Stockpile: There are some counters with sublistings like DB eCW061121 behind them. What are these counters? Is it what they call structured warrants? How do we play such instruments? Do these instruments affect the main share price?

Ans: Yes they are structured warrants. It is traded like any other stocks. But, they have an expiry date. I would suggest you to visit www.dbwarrants.com.sg it's a very useful sight for warrants. They normally follow their main share's movement. If you intend to trade warrants, please find out more! They are extremely volatile!


6 Dec 05, 17:27
Stockpile: Hi Decipher, thanks for your replies. May i know what is this counter STI ETF? Something to do with the index? They pay dividends, don't they? i see there is a 100 behind it. Can we buy in 100 lots.

Ans: Yes these are traded according to the STI's movement. I haven't traded them myself.


6 Dec 05, 15:28
xiao hei: HI Decipher, Biosensors 'moves' today cos Boston Scientific's bid for Guidant? may i know its support and if it is time to invest?tks

And: my trading style is to wait for a defined movement which will form some shapes like double bottom, cup and handle....hence i will not buy biosensor as of now. I haven't master the art of bottom fishing. As for support, I don't trust them. Normally I use money management to determine where i will cut loss. I'm not saying you should follow my trading style, but If i don't know, i want to be honest and say I don't know rather than bluff my way through. :)


6 Dec 05, 12:52
yoyo: decipher, will married deal quanity reflect on the total volume of trade?

Ans: Yes, it is taken as the volume in total for that day.

5 Dec 05, 17:54stockpile: Further to my earler question, what are some of the counters you feel bullish about? Tech stocks,banks. Looks like some of these counters are gearng for another push, perhaps.

Ans: If you want to know my current analysis of the market, please follow my growmoney blog too! : ) There I provide after market post mortem.

5 Dec 05, 17:24stockpile: Is it time to load upon shares now if one has some spare cash, since the market is quiet??

Ans: I wouldn't recommend buying blindly. Always differentiate between trading or investing.

5 Dec 05, 14:10yoyo: decipher, what are the advantages of married deal over buying/selling in open market?

Ans: Married deals are done privately and the price is not according to the exact buy/sell queue. Normally it's done at a discount to current price.

Hello all! Please continue to field your questions! I'm here to help. : )

4 Dec 05, 05:14Ley San: If you have held stocks which unfortunately fell down to almost 40-50% of its original value, with consistent low volumes, would you consider to sell or hold on ??

Ans: If i'm in your place, i'm not sure if i will have the courage to cut loss. 40%-50% lost is massive. I think since you are now forced into babysitting them, you had better check out the financials, if it's not a company worth investing, you might have to bite the bullet. Recalling past experience, I am stuck in HG-Metal, Sunpower, Anwell before. I cut my position before it turned nasty. An advise, decide if you want to trade or invest before you make the buy.


2 Dec 05, 16:31xiao hei: Hi, may I ask questions even if i am not a member? May i know your view on MIIF, it's downward trend & at historical low, wouldn't the 3.1 cts dividend help 'support' the price tks

Ans: I have no membership program! Everyone is welcome! I'm here to help. : ) MIIF is a REITs. Simply said, REITs are currently not in play. If you are an investor, the low price is actually very good to accumulate more. If you are a trader, it is not in play hence I decide to stay out. Interest rate plays an important role for REITs and you must also realise our market has many reits now.

2 Dec 05, 03:11res: r u a professional trader?

Ans: I wish I am! :D But seriously, i'm holding a permanent full time job and hence my trading system are mostly position trading versus intra day. However, trading is a business to me. Hence I spend most of my free time on it.

1 Dec 05, 15:48Quest: how importmant is the FA of a stock to you? if the TA is very compelling, do you trade based on TA regardless of failing FA or valuation?

Ans: I trade good FA stocks. I ignore poor FA stocks. Reason being, poor FA counter is prone to be manipulative for the insiders to get out. I have been tricked before and hence I am more careful now. :P