Stay Out From Current Equity Market. STI Near Previous Low.

Yesterday night I did some analysis on how the share prices would react if the KL Composite Index is going to break the 800 points ? Well the effect will not be great to most of the third liners counters but for the blue chips counter, they would facing great impact.

This conclusion was based on 1997 Asian Financial Crisis chart. We cannot say that it will happen accordingly but we must not think that it cannot happen in the first place. My experience in monitoring the share prices movement and by studying the charts have help me so much in terms of trading method.

I would rather say "Discipline" is the key word. To chop or not to chop (cut losses) ? To hold or not to hold ? No doubt the experience that I have for more than 10 years, it didn't means that I always win from all my trade whenever I made my purchase on Malaysian share market. In every round or battle that I have face, my chances of winning is basically based on charts. It is quite an important element or I would rather say one of the best tools to guide us to make some decision whenever we want to buy or to sell.

At these moments the KL Composite Index or the Malaysian share market will react in a roller coaster run. We might not really face a huge sell out but rather a slow crawling move to the south poles. Singapore Straits Times Industrial is moving near to their lows created last year October 2008 with U.K Financial Times already breaks it new low created last year.

Based on the current scenario, I would rather say that "stay at the side lines" or stay out. This will be a good option to adopt at this moment because the Dow Jones Industrial Average is still unstable.