Friday, 2 April 2010

Scrutinizing SG stock market

I have been lazy for the past year. Investing has always been on my mind but I am too lazy to get an account, and didn't bother to do any research nor studying... that is why I am lamenting every time I see a new peak in STI... I think I always 'man ren yi pai'. haiz.

Just started going into TA for the past few days. Wasn't as difficult as I thought. In fact it seemed quite interesting. Stoch, RSI, MFI, MA, Bollinger bands, SAR blah blah... tools that I never thought of using previously. I have been just stupidly looking at volume which is not that informative, it's just like looking at the tip of an iceberg. I still need to learn more about support and resistant and how to pin-point them.

I predict that current STI will continue to climb to hit above 3000. In '07 it almost hit 4000. Now it's still a time of fluctuations.

About parabolic SAR
The parabolic SAR is a fairly good tool for traders looking for a strategic method of gauging a stock's direction or for portioning a stop-loss order. This indicator proves to be extremely valuable in trending environments, but it can often lead to many false signals during periods of consolidation. This indicator is simple to implement into any strategy, but like all indicators, it is usually best if it is used in conjunction with other indicators to ensure that all information is being considered.

Another good tool for trending is Bollinger bands. It's said to tighten before a big move. Tight bands mean low volatility, vice versa. It also gives info on whether a stock is overbought or oversold (also seen with RSI) if plotted with a middle line of MAd20. However it does not predict the direction of movement.

Ref: Investopedia.com

What I am reading now:
Handbook for Stock Investors by Goh Kheng Chuan

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