Posted by Christie > 2014-05-30 19:13 | Report Abuse

Hi TCB,
I am trying to understand S&R:

On Support -
1) when share retraces and it stops at the 'floor' a few times; that's the support
2) if many times it touches the price, it means it is a strong support
3) I am aware that the strength of the support depends on the number of times it touches the lvl but does the length of candlestick body determine how strong the support is also?
4) Do we hv to look at Volume to determine support?
5) Do we consider the tail or only body of candle?

On Resistance -
1) when share shoots up and hits 'ceiling' and retraces; that the resistance
2) to 5) - same as above

You mentioned before to concentrate on the impt candlesticks - may i know what are the impt candlesticks besides shooting star/dragonfly doji/3 blk crows/engulfing candlesticks?

Thank you.

Posted by jass > 2014-05-30 23:45 | Report Abuse

thanks matrix:))

Posted by Dino Limo > 2014-05-31 11:40 | Report Abuse

Hi,
For Preshld,
The gap up on 28/5 , and the immediate gap down on 29/5...
What does it signify?
The Gap up on 28/5, I would've thought it would be a good indicator for reversal supported with a hammer,
but the next day (29/5) there was a big gap down, and many people who thought like me would be trapped there. Why is that the case?

On 29/5 the hammer had volume, which indicates to us that people have started to accumulate to prevent the break of support.
This could be a good trading play, next 3-4 days will be crucial.
It will probably be wise to enter at 1.73-1.76, and target price will be 1.85++ at your own risk. (resistance at 1.91)

Posted by jass > 2014-05-31 11:54 | Report Abuse

dino, really tq for ur info.:))

Posted by ProfitMan > 2014-05-31 13:46 | Report Abuse

jass/Dino Limo - Preshld:

If we were to look at the hammer formation on 28/5, by itself, it is not a buy signal although it has got bullish reversal implications. Usually, we wait for the following days performance to confirm whether the reversal will take off. And if you look at the prior candles, you will notice that they were bearish in nature, which means the selling may not be over so quickly. So, it is best to look at the hammer in conjunction with other indicators for confirmation of a reversal.

You are right, there is some accumulation taking place. On 29/5, there was a hint of a Price/AccDist vol divergence forming which points to shares accumulation. The 1.72 support is important. As Matrix mentioned earlier, "if support of $1.72 is violated with volume it is definitely heading south to $1.63/$1.58 and $1.40".

Posted by matrixcool > 2014-05-31 17:33 | Report Abuse

Christie, a very valid question for TA discussion. Everyone trades differently and analyze charts in different way too. I would like to share with you my way of understanding Support and Resistance.

First, it is very important for TA to actually understand Support and Resistance and whether it is a strong or weak support/Resistance. Some use SMA, Fibonacci etc so it is up to individual TA, I just answer according to your questions on Support/Resistance base on Candlesticks and volume.

a) Support—In a TA book (Short term Trading), mr Toni Turner uses a good example; Imagine you are in a room, you hold a ball and throw it upward. The ball will hit the ceiling and the ceiling prevents it from rising higher. Now the ball fall back and hit the floor, the floor prevents it from falling further. So your floor/ceiling is your Support and Resistance.
b) Every stock is like the ball in a), you must allow some leeway because every stock is different. That say a support/Resistance is at $1.00, if it does break below $1.00 say $0.99/$0.98 as long as it bound back above $1.00 the support is still $1.00. Same scenario as Resistance. BUT if a Support/Resistance is broken with BIG volume, that mean that level is violated.
c) The scenario you are referring on your item 2)& 3) sound like you are referring to Rectangle Trading , if so your analysis is correct. But remember, if a stock is trading on Ascending Channel, Triangles etc, each time the Support and Resistance or one of them change values.
d) A Bullish candle formed after rebounding from a support is significant candle.It confirms the support is holding well. A Shooting Star, Doji etc at the resistance confirm the opposite.
e) Volume is the 2nd most important features in TA beside Price. The rebound from support accompanied by volume confirm the support or vice versa at Resistance.
f) When you mentioned tail I would presume you mean Long Lower Shadow of a Candle like Hammer etc. Ya, they are important at Soupport/Resistance level. Candle can only tell you there is a bullish/bearish reversal but it cannot tell you for how far and how long. You need to work out the next Support/Resistance yourself. (Please note a Price reversal does not means a Trend Reversal, don”t get confuse).

Christie, I mentioned to you about Candlesticks because I am using Candlestick charts. Some TA may not agree with candlestick patterns. It is up to individual TA to use their own interpretation and I respect that. I would advise you to get a book on Candlesticks because there are so many patterns I cannot do it here. If I were to explain every candlestick pattern, it will be a book length.

But if you can fully understand Support and Resistance with Price and volume action, you can actually trade any stock using Support and Resistance.

Happy Trading and have a nice weekend..

Posted by johnny cash > 2014-05-31 19:24 | Report Abuse

please comment on this below mention screeners,,are there accurate and can be trusted,,please give oppinions----

http://www.tradesignum.com/screener

http://my-rsiscan.blogspot.com/

Posted by novice8 > 2014-05-31 23:14 | Report Abuse

Mat, tqvm for the precious sharing of support and resistance topic!!

Posted by ProfitMan > 2014-06-01 13:23 | Report Abuse

johnny cash - my personal opinion on these screeners is that it provides an alert or a highlight for us to look further into the counters BUT to me, it is not an indicator to buy or sell. You would still need to analyze further into the counter if you wish to trade into them. It may alert us on the counters but it does not indicate when to buy/sell in or out and neither does it indicate the price level we should buy or sell. At the end of the day, you and you alone will have to make the analysis yourself and decide on the next course of action.

Posted by ramsyll > 2014-06-01 18:40 | Report Abuse

Dear TCB,
Many thanks for your free advice on TA to fellow forumist, a noble charitable act that is rare in this materialistic world.
If it's not too much trouble, perhaps you could advise fellow traders or even mid/long term investors on a couple of matters:
1. the entry price for the stock too.
2. also, I would presume that a trader will have a number of stocks that they would be trading on at any one time, hence the question would be how much should one allocate their "limited" funds to each stock, i.e. equally? say I have $100,000 to trade, do i allocate RM20,000 each for 5 stocks?
3. Finally, KLCI TA.
Thank you. Cheers.

Posted by matrixcool > 2014-06-01 22:16 | Report Abuse

jonny cash, Yoda have done the chart for Scicom on May 26th.

# Scicom: close very bullish last Friday trying to breakaway frm the BB upper band.Momentum was rising and you have bought into it can hold for the mrkt sentiment to stabilized. Traders can take position if it holds above 1.08 level. A break out of the bullish penant will create a new high.
Resistance 1.12, 1.18 and mid term resistance 1.30
Support 0.995 and 0.95 #

Yet to break $1.12( went to a high of $1.11 very close to what Yoda suggested), very bullish stage 2 of the cycle. Any weakness should find immediate supports at $1.03 and those supports suggested by Yoda.

Happy Trading..

Posted by stay_foolish > 2014-06-01 23:11 | Report Abuse

I posted Dsonic on Mar 27

Dsonic- Dsonic is having a very bullish trend. But right now the chart looks like a Parabolic Reversal trend to me. However, we dunno when the uptrend will end, just need to be more cautious. A negative catalyst might create a massive panic.

After reading the chart on 1/6

The price break the parabolic curve because of the huge sell down on 04/04. The price drop since then. A morning star formed on 16/04 which mean 2.62 is a very strong support line. A small U shape is formed from 21/04 until now. However it failed to break to break 3.92, it expected to further consolidate btw 3.66 and 3.81.

Posted by stay_foolish > 2014-06-01 23:11 | Report Abuse

Karex

It is very bullish since IPO. Right now the price is trading in flag btw 2.95 and 3.21. Need to break throgh 3.21 to test 3.29. If break 3.29, the only resistance is 3.52. The support 1 is 2.96 and support 2 is 2.86.

Posted by stay_foolish > 2014-06-01 23:12 | Report Abuse

Mudajya

Market cycle stage 3-distribution. In weekly chart, Mudajaya has been trading in a rectangle for almost two years until now. On 23/04/14, the price gap down and fall from 2.75 to 2.47 for four weeks. On 30/5, Engulfing bull formed after a month decline. Price is expect to test resistance 1- 2.58 and resistance 2- 2.62. A very strong resistance at 2.72. Support 1 at 2.42 and support 2 at 2.39

Posted by matrixcool > 2014-06-01 23:25 | Report Abuse

02/06/2014

Every week TCB will pick a few stocks we may like to trade short term and put in *Stock In Focus*, please do not take this as a buy signal as our TA reading for those stocks are for sharing purpose only.

STOCK IN FOCUS ( Short Term Trade)

SCOMIES—Breakout from the Double Bottoms on Friday with increased volume at $1.04 which has an immediate target of $1.12 with immediate resistance at $1.08. Any weakness due to the overbought position should find immediate support at $1.04/$1.02 and very strong support is at $1.00. Any weakness offers buying opportunity for future play. A break above $1.12 will take it to its previous high of $1.17 and Target 2 of $1.20. Short term trading Range estimated to be $1.02 to $1.12. Stop Loss if $0.96 is violated with volume.

Happy Trading and Good Lukcs !!

Posted by matrixcool > 2014-06-02 09:29 | Report Abuse

Ramsy11, thanks for the kind words. I am sharing my method of entering of any stock and it could differ from many other traders as I am a short term trader.

1) The only right time for me to enter a stock is when I have identified a strong support and a possible Target, my collection will start when it is trading as close as possible to that support. As long as Rewark/Risk ratio is more that 1.5:1 I will take the trade.
2) I think your allocations of 20% is reasonable for your portfolio. I would do about the same too.

KLCI I think SF had done the analysis earlier, please refer to his earlier post.

Happy Trading..

Posted by tccher > 2014-06-02 11:46 | Report Abuse

Matrixcool, Thank you very much for the "stock in forcus " and "support and resistance topic " .

Posted by Christie > 2014-06-02 11:51 | Report Abuse

Tks alot Matrixcool for yr explanation on S & R.

Posted by matrixcool > 2014-06-02 14:55 | Report Abuse

tccher & Christie, you are welcome.
The main purpose of TCB is to help forumist that need help on TA for their stocks.

The Stock In Focus is the stock that we pick and think that it may offer some trading opportunity in short term. Please do not take it as a Buy Signal.

Happy Trading

Posted by Dino Limo > 2014-06-02 15:00 | Report Abuse

Hi,
Was wondering where you find this "stock to focus" website? can provide link? Thanks

Posted by Mc_Wei > 2014-06-02 15:43 | Report Abuse

Congratulations to matrix and gang on launching TCB. Just got back from long holiday. Most counters still at the same level as 2 weeks ago, except that KLCI has moved up quite a fair bit albeit with negative divergence with MACD. Doubt market will be any exciting in June due to world cup coming. Expect selldown as people cash out to bet football.

Posted by matrixcool > 2014-06-02 16:34 | Report Abuse

Mc_Wei --Welcome back. Don't think you missed much in May, June did not start well today.Like you say, when football starts maybe it will get a bit quiet..

Dino Limo--Stock In focus has no link, it is chosen by us thinking it may offer short term trading opportunities.It is not a BUY signal just to share our thoughts.

Happy Trading

Posted by Mc_Wei > 2014-06-02 17:10 | Report Abuse

I'd like to add abit to Ramsyll's question no.2

It all depends the size of your portfolio. As we are talking about trading, the duration of holding the stock is quite short hence you want to make sure you can get out whenever you want.

For me, I set a limit of trading not more than 5% of average daily volume. Let's say if a counter's volume is 1m shares a day, then the maximum quantity I can buy is no more than 50k shares.

You shouldn't restrict yourself to 20% for each trade as different trade has different risk and volatility. It all goes back to your risk-reward plan.

Posted by matrixcool > 2014-06-02 19:44 | Report Abuse

Mc_Wei,
Thanks for sharing your way of buying stock, quite interesting by using daily volume I must say.Ya, it is the most important to work out the Risk/Reward ratio before buying in any stock.

Happy Trading..

Posted by matrixcool > 2014-06-03 07:27 | Report Abuse

03/06/2014

Stocks Update;

SCOMIES--Yesterday closed with a Big Black candle, some sideways movement from $1.00 to $1.05 could be expected. It will start to show weakness if $1.00 is violated and Stop Loss if $0.96 is violated.

BREM--The volatility has been extremely low for the past week, some price fluctuation (either Up or Down)with volume may be happening soon. It will show weakness if $2.02 is violated.

WCT--Formed a Doji Star yesterday, if break $2.18 signal price reversal to $2.20/$2.22.

Happy Trading...

Posted by ProfitMan > 2014-06-03 09:33 | Report Abuse

Just read this interesting Samuelson quote that I thought I share with you people. An interesting way and another perspective of looking at investment.

"Investing should be more like watching paint dry or watching grass grow. If you want excitement, take $800 and go to Las Vegas."

Paul Samuelson

Posted by tccher > 2014-06-03 11:27 | Report Abuse

Matrixcool, Thanks for the scomies update. have a nice day !

Posted by Dino Limo > 2014-06-03 11:42 | Report Abuse

Oh, u mean stock in focus will be posted here?
and I'm guessing none has been posted yet?

Hahah just wanna see how u guys analyse. and learn from there. Wont simply buy in . ^^

Posted by matrixcool > 2014-06-03 12:48 | Report Abuse

ProfitMan, so are we taking the money to Las vegas instead of watching Grass grow.Grass might die while growing.

Dino Limo --Stock In Focus will be posted here whenever we feel the stocks might offer opportunities for short term trade. Yesterday we chose SCOMIES because of last Friday closing and chart wise looks so promising after breaking out of its Double Bottoms formation.But due to BIMB Securities Research that downgraded it to SELL with target price of $0.90 the stock actually move south.

Happy Trading..

Posted by novice8 > 2014-06-03 12:57 | Report Abuse

Mat! Tq for WCT and Brem analysis!!

Posted by ProfitMan > 2014-06-03 14:10 | Report Abuse

Matrix - ha ha ha... yes you are right, grass might die while growing. That is why we always advocate traders to monitor your stock and cut loss early if it hits your trailing stop, i.e. grass is dying. And if the share is trending up, i.e. grass is growing well and turning greener, ride the profits and lock in profits when it hits your target, i.e. time to cut the grass to sell. Just an anecdotal way of looking at things.

Posted by lsy7 > 2014-06-03 14:39 | Report Abuse

Dear TCB,

For sharing

EPF has received 6 submissions for Project MX-1, a town centre in the proposed Kwasa Damansara has GDV of RM50bil.
The six companies were GUOCO, MRCB, Putrajaya Holdings Sdn Bhd, SPSETIA Bhd, UEMS Bhd and YTL.
Comparison of listed vessel provider company in Malaysia.
1)Alam:23 vessels, average 7 years old
2)Icon:32 vessels, average 5 years old
3)Bumi Armada:61 vessels, average 9 years old
4)Perdana:13 vessels, average 5 years old
5)Perisai:9 vessels, average 8.5 years old

Posted by ProfitMan > 2014-06-03 15:23 | Report Abuse

lsy7 - thanks for sharing the info.

Posted by novice8 > 2014-06-03 16:57 | Report Abuse

Dear TCB- may I know the TA of Cypark pls? Tq!!!

Posted by speakup > 2014-06-03 17:20 | Report Abuse

Better buy Alam than apply Icon

Posted by matrixcool > 2014-06-03 18:48 | Report Abuse

speakup ,

Thanks for your input on Icon. Isy7 has been kind enough to provide the list of companies that supply O&G vessels for forumists to compare and maybe make a decision. I think by the time Icon is listed, the listing may provide some excitement for companies that provide the same services. Hopefully it is positive, so the listing may also help those companies share prices to rise.

novice8—TCB will study Cypark chart for you tonight.

Happy Trading..

Posted by Lz Lee Weiping > 2014-06-03 19:25 | Report Abuse

dear TCB, can you help on UCHITEC?

here's my analysis:
it has a resistance of 1.45 and a support level of 1.42...it has been trading in this rectangle since early of april until now..so i guess that it's in the stage 1 of cycle.
and i noticed that it got a long candle on 30/05 and high volume does it have any significant?

Posted by tsy88 > 2014-06-03 20:35 | Report Abuse

Dear TCB -Can u check 4 me on: 1) Benalec - capable of going abv 1.20 short term. 2) Menang - can 1.02 hold n ok 2 buy at this lvl. 3) Furnweb - in view of its rights issue with free warrants going ex on 10 June 14, is there more upside going forward? Tq in anticipation.

Posted by matrixcool > 2014-06-03 20:44 | Report Abuse

Lz Lee Weiping

UCHITEC: You are quite right in your analysis of Rectangle Trading. The Range is from $1.41 to $1.47. It is under consolidation, but still in stage 2 of the cycle and needs to break its previous high of $1.47 to carry on its bullish stage 2 cycle. If it breaks below $1.40 means it may have started Stage 3 of the cycle (Distribution Stage) with strong support is at gap support of $1.39/$1.37. A break below $1.37 confirms stage 3 of the cycle is over and starting its stage 4 of the cycle and to be avoided at all cost.

On 30/05 the big volumes of selling was well absorbed by the market near the support of $1.41.

Note: Not all rectangle Trading is at stage 1 of the cycle BUT stage 1 cycle is normally in Rectangle Trading.
Sometime at stage 2 of the cycle it may form Rectangle Trading during consolidation.
Stage 3 of the cycle also can be Rectangle Trading but normally the range is much bigger (price is volatile).

Hope this help.

Posted by tsy88 > 2014-06-03 21:05 | Report Abuse

Sori. Furnweb going ex on 12 June.

Posted by nana88 > 2014-06-03 21:35 | Report Abuse

Dear TCB, can you help to advise on Seal. Thanks.

Posted by nana88 > 2014-06-03 21:52 | Report Abuse

Yoda88,
Is the down trending over for farmbest? Was that a hammer follow by two white candles, plse correct me if otherwise, still learning :). What is the support and resistance? Thanks.

------
Chenlai- Farmbes
Farmbes is down trending and at its 4 week low. Watch the weekly chart whether it will retrace further to test the 100MA @ 0.61 level.

If you have enter based on bottom fishing apply a stop loss at 0.61 level. The next support will be 0.59 and further downside towards 0.565.

If you have not taken any postion observe for a reversal signal followed by a healthy volume.Happy trading.

Posted by matrixcool > 2014-06-03 22:10 | Report Abuse

nana88

SF reads the chart on 27th May for CK,
# Seal :Market cycle 2 - Mark up stage which is still uptrend. The doji formed today means likely trade sideways between 0.68 and 0.70. Volume is needed to break resistance 1- 0.755 and test 0.775. At the moment still is the correction on a uptrend if 0.64 is not violated. If 0.64 break, it may enter market cycle 4- Markdown (bearish). stay_foolish > May 27ck #

03/06--after SF reading,

Yesterday​SEAL broke out from $0.775 with a Breakaway Gap to carry on its stage 2 of the cycle, which is very bullish and carry an immediate Target of $0.90 and beyond. For trading on stage 2 cycle, we would recommend you set a Trailing Stop to protect your profits. Immediate support adjusts to 40.80/ $0.775 (Resistance turns Support) and very strong support is at Gap Support of $0.76/$0.72.

Happy Trading..

Posted by matrixcool > 2014-06-03 22:22 | Report Abuse

tsy88 ,

Benalec – Stage 2 of the cycle and very Bullish. It hit a high of $1.20 today after breaking out from $1.18 which carry on estimated target of $1.28/$1.30. The next resistance is at $1.22 if it can stay above $1.18. Any consolidation may find support at $1.14 and strong support is at $1.06. The problem with Benalec is it has lots of overhangs to be clear, any further rebound may invite sellers whom were caught earlier at higher prices.

TCB will read your other charts, maybe later tonight or tomorrow.

Happy Trading..

Posted by nana88 > 2014-06-03 22:26 | Report Abuse

Thanks Mat for the quick reply.

I have read before that if there is a gap up/down, it will be filled eventually. Does it also apply to this 'breakaway gap' in this scenario.

Thanks.

Posted by matrixcool > 2014-06-03 22:33 | Report Abuse

nana88,

Ya, all the gaps will be filled eventually, but when no one can tell you. A breakaway gap is very Bullish and Seal may scale higher in near term.

Happy Trading and Good night..

Posted by tsy88 > 2014-06-03 22:40 | Report Abuse

Matrixcool - Tq so much 4 yr reading of Benalec. Fyi, juz bot at 1.18 this afternoon. May average at lower lvl. Looking forward 2 yr analysis on Menang n Furnweb.

Posted by matrixcool > 2014-06-03 23:30 | Report Abuse

novice8

CYPark—Stage 2 of the cycle and very bullish, It is under consolidation in downward movement after hitting a high of $3.05 on 23/04/14. It hit a low of $2.74 today and if this low cannot hold it is expected to test its strong support at $2.70 and $2.65 which may offer buying opportunity for future play. Cypark shows weakness if $2.65 is violated because that means it violated its Uptrend Line ( as of today and value increasing each day). A break above $2.82 signal Price reversal and it should re test its immediate Resistance at $2.90 if break will re test its previous high of $3.05. For the short term trader you may want to Stop Loss if $2.65 is violated with volume.

tsy88 --We do not encourage average down, but set a stop Loss if you are wrong.I have given you the support level for Benalec so you need to make the decision.

Happy Trading and Good Night..

Posted by yoda88 > 2014-06-03 23:34 | Report Abuse

Chenlai-Farmbes

You're right,I did not follow this stk otherwise could have make some profit.
Share price is likely to see some buying interest as substantiated by the “Hammer” candlestick on 30 May 2014 followed by bullish uptrend. Moreover, daily oscillators are hooking up, suggesting imminent resumption of uptrend. Check out some strong news surrounding this stk,look out nanyang paper.

Since both hourly and daily charts concur, further upside targets are RM0.695,RM0.755 and 0.78.
Immediate support is RM0.64 and RM0.62. Stop loss below RM0.61.
Happy trading.

Posted by nana88 > 2014-06-03 23:56 | Report Abuse

Thanks Mat, Thanks Yoda88

happy trading, good night.