AAR & TOL 01 (May 08 - Oct 08)

[kennynah]

ok...let's do that...

so, like to hear your thoughts on what next, given these mayhem ongoing.... tx

[winston]

TOL:-

The easy money in short-selling has already been made..

Recently, we witnessed a few strong spikes upwards. The latest spike was when Freddie and Fannie got rescued. That tells me that the short-sellers are also quite panicky and does not have much conviction in their short position. On the slightest hint of some good news, they would cover first and then investigate later..

Also, too many people are too negative on the markets eg. on CNBC & Bloomberg, in Newspapers, Magazines, Analyst Reports, Forums, Newsletters etc.

Remember what happened when a lot of the people were calling for
1) Oil to reach $200 or
2) Gold to reach $2000 or
3) Vietnam would be the next great property play or
4) US$ is doomed etc..

[kennynah]

ok...noted ...u r bullish bias..or at least bearish risk averse now...

i kinda oso am in sync with you on this approach...generally, be more cautious and more acute aware of downside risks...and the possibility of upside rebound explosion... however, i dont think any upside will have sustainable power...the shorts will cover and that will push prices up to an extend until their shorts are pretty much covered.. then, again, it will slide down becos no buying interests..

so... it's probably going to be lesser and lesser volatile...gg forward... as soon as aig settles down...and assuming (which is a big assumption) no more hk cases...then... the panic will settle and everyone takes a "see look attitude..."

GR brought up the point about s&p possibly downgrading aig...and that probably is also weighing on aig's price now...so, pretty much discounted by now...

[winston]

I just glance thru the top losers today.

There were some stocks which dropped a lot on very little volume. Obviously, some small investor were panicking...

I dont think today is the right time to sell. If one wants to sell, wait for the rebound. However, when the rebound comes, they would probably not be selling

[millionairemind]

I dont think today is the right time to sell. If one wants to sell, wait for the rebound. However, when the rebound comes, they would probably not be selling

Step 1. Cos' they would be thinking - just 5% more for me to break even then I sell..

Step 2. Then the market gives them the 5%.. and they think - Just let me make 5% profit then I sell..

Step 3. The market gives them 5% more - and they think, it is coming back.. hold on for more gains.

Step 4. The market suddenly reverses and the stock they are holding breaks even, again - and they think, hold on a little longer, should have taken the 5% but it will come back..

Step 5. Then the market reverses and tanks 20%! and back to Step 1...

[OE2008]

Vix spiked up to "fear" level last night. Coming close to buy zone. Art Cashin makes occasional commentaries on CNBC in the early morning. His take is that a capitulation followed by heavy volume buying would signal a bottom. So watch the price and volume closely. There must be sustained high volume on rising price to validate the strength of rally.

IMO, I am expecting further selldown followed by a good bounce. Make no mistake, we are in bear territory. Don't get mauled .

[fclim]

A close similarity to the present financial woes is the 1997 Asian financial crisis. How the Asian share markets turned around, length of time taken, which sector or sectors rebounded first? I wonder if you can remember or have knowledge of it. Would appreciate if you can share.

hi Cherry,

cant give my opinions, its limited and skewed anyway...
instead, why not look at a real example?
apologies for the lousy resolution, u can click on it to see a 'bigger' picture.

UOB's 10 yrs share price/volume and other key valuation figures...



have fun,
fc

p.s. for more info, check out the below:
Background and overview of Asia Financial Crisis (I did not verify hor)
http://en.wikipedia.org/wiki/Asian_financial_crisis

UOB annual report - See page 142 of its 10 yrs share price / volume and key valuation figures
http://www.uob.com.sg/assets/pdfs/UOB_A ... t_2007.pdf

[Cherry]

cheng wrote:
A very interesting depiction of the Economic cycle, via Matt Blackman's EquiTrend Weekly Market Watch

fclim wrote:
instead, why not look at a real example?

Hi Cheng & FCLim

Thank you very much for your input. I appreciate it.

[winston]

AAR:-

1) Always take windfall profits. If you were greedy and held on to your short positions, you are dead meat now..

2) If you sold right at the peak of the fear yesterday morning, you would have easily lost 15% to 25%

3) And if you were not brave enough to buy at the peak of the fear, like me then all you got was a free action packed movie

[millionairemind]

3) And if you were not brave enough to buy at the peak of the fear, like me then all you got was a free action packed movie

Does the movie come with pop-corn?? I was watching GI Joe, all -action..