Monday, November 3, 2008

OUTSTANDING for KL Composite Index.

Today market movement was quite a surprised for me. I didn’t expect it to move so drastically. From what has happen last two weeks until now, I have gain something from this movement. This is something that we all suppose to learn from, whenever the share market experience a degree falls of 70 degree to 90 degree and a continuously falls, this would be the right time to enter to the market.

From the last week share market movement, no one have any confident to enter and to buy some of the shares, some even tell us to stay out but I didn’t do so. I just keep on continue to buy during the sharp falls.

It happen before during 1997 Asian Financial Crisis when the share prices rebound for few days but during that time I don’t have any experience in catching a falling knife (buying at the right time when the market experience a sharp drop before moving up for a rebound), hold a falling knife (buying at low and hold until the prices reach certain target) and to throw back the falling knife at the right time (selling at the high).

From tomorrow onwards I would suggest a SELL call on the market movement. The KL Composite today gains +35.74 points to close at 899.35 points. The market have rebounded about 100 points from low recorded last week at 801.27 points. The share market needs to consolidate before any significant movement can be reach. World market is doing well after their recent sharp drops.

Since the beginning of the year I have been involved five times in catching a falling knife and I succeed in all those process. Either I make a portion of profit or maybe just a little bit only.

All were done on a contra basis. I'm not good enough in holding a falling knife and I was very bad in throwing back a falling knife. Just stay cautious and don't get over react with the share market drastically movement (going up).

KL Composite Index is no longer in an oversold position. The Relative Strength Index (RSI) is already moving out to a neutral zone.

We are now entering the month of November. Basically in the month of November every year DJIA will fare better compare to the month of October. I was hoping that after all the excitement happen during the month of September and October, let us take a break in the remaining 2 months before we celebrate the year of 2009.

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