KCPO -  Bulls Launch First Strike - 2/4/2013

 

The market did not hit my stop placed at the middle band but proceeded to move higher. The move is pretty explosive , gaining a 100+ points within 3 days. I am revising my stop to the top band minus 2/3 points.

The Stochastic, MACD and DMI remain positive. And now we have a upswinging ADX to confirm a new trend in the market. There will be an immediate resistance at 2615 but It would not be too much to expect if we see this market going back to 2900 or 3100.



 

Price went above the middle band at the weekly chart which would trigger a buy signal if I am trading with the weekly chart. The Stochastic and MACD continue to rise. The Stochastic may break above its 50's signal line which by itself is flashing another buy signal. One more buy signal would be price going above the top band of 2564. The ADX is finally falling from above the DMI, my ultimate confirmation that the prior trend has ended.  The DMI is still negative but their gap is fast closing. With the D+ crossing up the 20's signal line is adding more comfort to my buy side of the story.



 

The monthly chart confirms only one thing = it has been a sideway market for the past 4 months with the ADX flat at 18's. All the 3 indicators are negative but the usual faster reacting Stochastic seems to be making a turnaround. I would need to see price going above the bottom band and a Stochastic crossing up its 20's signal line in order to call for the end of the bear cycle. I certainly do not trade the monthly chart, it is for me to monitor the bigger picture.

There was an interesting piece of news regarding the premature end of a palm oil plantation investment scheme. I have a lot of thoughts on that but I certainly cannot express them here. But one thing that has been bothering me:- I remember a friend who was in the industry for his whole life told me  the simplest and cheapest way to get rid of wild elephants is to dig deep trenches around the perimeter ? I think the moral of that story is like the recent gold investment fiasco - NEVER expect other people to make money for you.  If they are really that  good, would they bother to work for the pitiful sum of management fees you are paying to them ? We just to have learn by read up ,listen and think critically to trade/invest our money . There is no fast track to it. If you are lazy, then you should instead place your money at the FDs in the banks.