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Hi Readers,

I would like to wish all Chinese friends out there "HAPPY CHINESE NEW YEAR" and "GONG XI FATT CHAI" as today is the Chinese New Year Eve. May you enjoy your reunion dinner tonight. This week is a long holiday for Malaysia stock market as Feb 1st is Federal Territory Day and Feb 3rd-4th is the Chinese New Year celebration. So, it can a be more quiet week than usual. However trends remain trends regardless of anything else. Let's take a quick look into Malaysia index futures market FKLI.

As we can see in the above 15-mins intraday chart for FKLI Spot Month (Malaysia Index Futures), there are some strong support around 1,500 points. Twice heavy selling could not break beyond this level as of now. Signal 1 is NOT a buy or sell signal itself but it is only an alert signal to watch for. As of last trading day in 31 Jan 2011, the FKLI spot month closed at the support / resistance line around 1,516 points. So, it barely triggered the Signal 2 which could means it will most likely to rally upwards in these couple of days. Please be reminded as of now, the most likely rally is the corrective rally instead of a new uptrend wave until signal indicate otherwise.

p/s: Hope you enjoy making money shorting the stock market 2 weeks ago. Enjoy your holiday.

There is no doubt it was a strong market rally for quite sometime now. The question that we are asking is that when will the stock market pause and have a good and healthy correction to its uptrend? Personally, I believe that the market has more upside in the mid term to long term view. As for short term market outlook on hourly stock chart for FKLI Spot Month (Malaysia Futures Market), we could see that the market had been rallied to the new high at 1579.5 (projected based on multiple Fibonacci retracement lines) before its short term target for correction down to 1555 before rebounded back to 1575.5. Please be aware the rally back to 1575.5 was actually a bear flag chart pattern forming. As of yesterday, the bear flag was broken, and we could expect to see more correction for FKLI and KLCI market for a short term market review before any healthy uptrend can continue. My first projected target based on Fibonacci would be at 1543 points.

We could see Fibonacci at work in the stock markets. Elliott Wave also demonstrated Fibonacci sequence in the wave counts. Below is an example of how Fibonacci and fractal works in the nature. Each water drop captured using high speed camera shows that the drop was bounced back while a bigger portion of itself joined the water surface. We could see that this happens so often in stock markets. Each market rally was interrupted with trend correction while each stock market fall was pause by bounce-back rally before continuing its trend directions.

It would be wonderful to observe if the bounce-back strength of the water drop coincide with the Fibonacci retracement ratio. Hopefully someday, some scientists take the effort to measure that.

Hi fellow investors & stock traders,

Be prepared for a new leg of downtrend coming next week starting from 30 Nov 2009. News that Dubai World, the emirate’s main development engine, was asking creditors to delay paying back its $60 billion debt, triggered a heavy selling pressures on the equities and commodities market. Hong Kong’s Hang Seng Index (HSI) dropped -1,075.91 points (-4.84%) to 21,134.50. Japan Nikkei dropped more than 300 points to 9,081.52.

Be prepared for heavy selling pressure on the US stock markets today as it re-open after yesterday holiday. Expect more selling pressures next week. It’s time for a stronger correction to the previous rally.

All stock traders had their good and bad days. In my years of trading in stocks, index futures, commodities, and options, I would say that I made a lot of mistakes and therefore lose money or make profits lesser than what I am supposed to earn. The worst of all these was that I kept repeating my same mistakes again and again. I knew where I had gone wrong in my trading strategies. I would like to put up this blog post to share with you of my trading mistakes as well as to serve as a reminder to myself so that I will not repeat it. I look at financial speculation as a serious business and I am adamantly committed to this course to unlock the secrets of the stock markets. It is one thing to know the workings of the stock markets, and another to get rid of our natural habits that are not built for financial investment and speculation profession. We must work hard to improve our trading skills and accuracy as well as getting rid of the bad habits that is in-built in us that cause us to lose money in the long run.

Read entire post of My 5 Biggest Trading Mistakes in Stock Market

Malaysia’s 40 richest man has seen their total net worth decline by 22% amounting to US$36 billions. Below is the list of Malaysia top 10 wealthiest individuals.

1. Robert Kuok – US$ 9 billion
2. Ananda Krishnan – US$ 7 billion
3. Lee Shin Cheng – US$ 3.2 billion
4. Lee Kim Hua – US$ 2.5 billion
5. Teh Hong Piow – US$ 2.4 billion
6. Quek Leng Chan – US$ 2.3 billion
7. Yeoh Tiong Lay – US$ 1.8 billion
8. Syed Mokhtar AlBukhary – US$ 1.1 billion
9. Tiong Hew King – US$ 1 billion
10. Vincent Tan – US$ 750 million

Malaysia richest (Robert Kuok) and 2nd richest guy (Ananda Krishnan) total net worth would be US$ 16 billion and account for 44% of the Malaysia top 40 richest Malaysians. By the way, Robert Kuok and Ananda Krishnan is the two richest guys in South East Asia.

All the wealthiest guys in the world saw their wealth drops substantially. Bill Gates’ net worth estimates around US$ 40B falling by US$ 18B while Warren Buffett’s net worth estimates around US$ 37B after dropping by US$ 25B.

Hong Kong tycoon Li Ka-shing aged 80 has a net worth of US$ 16.2B ranked world 16th richest guy after seeing his fortune falls by US$ 10B.

I have to write this. During this recent bull-run, some of my friends lose quite a substantial amount of their trading capital by shorting the index futures. Instead of cutting their losses quickly, they compound to their mistakes by adding short positions as the index futures traded higher each day. In this post, I would like to bring out 5 sure ways to lose your money in the stock market, commodities market, or forex. You will be surprised that many of the index futures traders out there are practicing these and therefore on their ways to financial ruins. Don’t do this as it will hurt your pocket and causes you to lose your precious trading capital. Apart from sharing with you on these few key points on stock trading wisdom, I will also share with you on the traders’ psychology and why they kept making these mistakes and were not able to rescue themselves out of this financial mess.

Read entire post of 5 Sure Ways for Stock Traders to Lose His Money

There are some magical numbers and sequences of numbers that have their prints in the nature. They were there in the first place because God who created the whole universe encoded them just like His signature or autograph. Now, we might wonder, why is these magical numbers so important in our discovering of the secrets of the stock market trading and investing business? The simple and quick answer to that question is that these numbers resonate and vibrate in the stock markets, commodity markets and forex just as they are found in the universe that we live in. This is true for any financial markets. Before you discredit my claim of the magical number pi (π) and its application in making money in financial markets, take a good look of Fibonacci. This magical sequence of numbers of Fibonacci that starts from 1, 1, 2, 3, 5, 8, 13, 21, and etc, had been a very good technical indicator of when (time) and where (price) should the index futures reverses its trend. The number of pi (π) is so magical that its decimal portion is unique and there is no repetition of patterns. Just in case that some of you wonder what pi (π) is, it is a constant number where pi π = 3.1415926535897932384626433832795… The study of market cycles and market geometry uses pi (π) to pin-point the exact reversal date and price for stock markets and other financial markets. Here I present to you a video that sings out the magical number of pi (π).