Hello Fellow Traders
Reference to my previous stock analysis on Sembcorp Industries LTD, a listed
Stock in Singapore Exchange.
Reference to the previous post on “Stocks Analysis” Posted on June 16, 2010 by fapturboguru
A buy ordered was triggered by the “Blue Diamond”, therefore I took the trade
The very next day 14/6/10, the transaction was snapshot for your reference below the chart. The stock was purchased at $4.04
“Diamond Trading” is a proprietary trading that I develop to trade using End-Of-Day data therefore I do not need to stare at the tape every second.
Diamond trading understands that price does not move in a straight line therefore allow price variation as price moves in a specific direction either up or down.
Basically there are two type of diamonds in this trading system. The Blue Diamond is responsible to pick up long trade with specific requirement such as price must be in trend expansion mode, the volume should seen to be increasing over the number of days and there price has a healthy spread with volume supporting the upmove.
On the other hand, the Orange Diamond is responsible to pick out stock that is exhibiting sign of distribution, such as price has been increasing with reduced volume towards a recent resistance level, this could be the 1st sign of trouble and the probability of breaking out of resistance is low base on normal training condition. A diamond scanner that I have coded will scan the whole stock exchange to pick up probable candidates for further analysis.
A screenshot of the Diamond Scanner can be found in my previous post.
Look at the 08/07/10 chart below.
After the stock was purchased on the 14/6/10, it experienced low demand from the professionals, this could possibly due to the market timing was not ready for the price to be pushed up.
On 22/6/10, witnessed the first sold-off after purchased but a close look at the candlestick, price moved in wide range and at the end settled near the mid section of the range, this was the result of bulls and bears fighting hard to defend ground. This aggressive competition was showed by the huge trading volume for the day.
Similarly the next day on 23/6/10, trading volume was huge and the competition was fierce too. But take a closer look, although the competition
Was fierce on this day, the price did not close lower than the previous day’s low and the day’s low wasn’t lower than the price day low. This gave me the
Assumption that the selling pressure had reduced tremendously and the bear was likely to be neutralized and this was further confirmed by the next day 24/6/10 where the price traded $0.09 higher. From this conclusion, I decided to hold on to the long position and let the nature takes its course.
Today 29/6/10, price has went up to $4.18 which is up $0.14 per share from my entry price at $4.04. But at the end of the day, the price closed down to
$4.08 with slightly above average selling volume.
Interestingly the next day 30/6/10, price open at rock bottom and closed at day high with above average volume. This gave me the conclusion that the professionals
On both sides were pretty strong and so I waited for the next day to decide if I
Should close the position.
01/07/10, look at the chart, it was a red candlestick with very low volume as compared to the previous two days where volume were above average.
This gave me a strong conclusion that price was going to soar soon. Why?
If you knew how to read price bar correctly, you would evaluate the current
Price bar as compared to the previous few price bars inorder to get a better
Understanding what the professionals side of the market were doing.
This down price bar was closing away from the day’s low and the volume was
Very low. If the sellers were motivated to push down the price further, won’t they want to push down the price below yesterday’s low or much lower instead. This did not happen and I expected the opposite. Price should soar from here as the sellers were not strong and in my opinion that this down price bar was
A “TEST” to determine if there were anymore motivated sellers in the market.
02/7/10, the next day, price closed above the previous red bar giving a clearer
Indication that the sellers were indeed not motivated to sell and so I expected price to go higher. Therefore I held on to my Long position till now.
Today, 08/07/10, price is near my expected target with day high at $4.23, closed $4.21
Expected target remain unchanged at $4.24. (set of 16/06/10, article can be found at the end of this page)
You can trade with confident like me if you seriously believe in this business.
By anticipating the future move with precise analysis of Price, Volume, Support and Resistance & Price Channel Behaviour. You can consistently
Trade well and stay cool.
So when will I sell?
A sell order will be triggered when an orange diamond appear. So far the price is in uptrend with higher trough; therefore it is likely that price will move further north until I expect to see orange diamond to reap all my profits.
My trading notion
“ Buy when the market is quiet and boring, Sell when the
Market is hot and exciting”
There is no consistent way to predict market top or bottom, When signal triggers me to take specific action either buy or sell.
Just trust the system that I have created, don’t be greedy to pick a few more
Pennies as I won’t know what will happen next. Be happy with what you achieve.
You can catch up with my video at http://fapturboguru.wordpress.com/
Trading is just a game of probability, there is no certainty.
Thanks for reading and happy profitable trading!
SGtrader