Dangerously low

Total bummer last night. Dow dropped a 100 pts when job claims dropped by 8000 but fell short of expectations. Showing that people are not looking well at the economy. Bet many at the asian side were scared shit by DOW. It's getting clearer that now the DOW is undergoing consolidation and we are hanging dangerously on the 100 Days Moving Average. If DOW breaks tonight, then prepare to fall to 9600 pts.

Tonight we will have some economic news again: First look at 4th Q GDP; Chicago PMI; consumer sentiment; earnings from Chevron.

Chicago PMI should look good with improvement along with higher consumer sentiment. So tonight might go up.

Soon?

The DOW ekes out a gain. First it was down with not very nice earnings from reporting companies last night like CAT. It's pulled up by Apple's new announcement of the iPad. If tonight close positive, then we have a further upside.

Obama Union Speech

Obama's Union speech tonight. Might be a big market mover.

Bears resting

Bears took a rest last night as yesterday DOW came out green after fighting for a time. An inverted hammer formed meaning that the market could be in for a reversal or a consolidation. I was anticipating for a confirmed reversal today in the Asian market but alas, China came out with the tightening of credit and the whole market just crashed again so my reversal was overturned by this news (Market is dynamic). Bad news always comes in waves one after another. Prepare for more crashing tonight unless something good turned the tables.

Another Plunge

The DOW plunged again on Friday night. First it started slow, then after that it plunged again within minutes! Scary. Fear is in the air. That's why the market just plunged as everyone started panicking and shortsellers are shorting aggressively. It broke the 50 MA boundary and my 200 MA was pointing that the DOW might go until about between 9400 and 9600 in the future. Isn't it scary?

Plunged!

BOY, I was dead wrong last night. The market just plunged within minutes when Obama announced that he will curb the risk-taking by banks sending all bank shares plunging. The whole market just plunged 200 pts due to fear. GS made outstanding earnings but failed to lift the markets.
A head & shoulders pattern started to form before US markets opened. And it broke through the last shoulders which send the market crashing.
I cut loss to one of my holdings and taking profit in others while it is still profitable in the morning. STI just PLUNGED in the morning session, while afternoon session seeing recovery. But remains to be seen if it's real. Think tonight could be a short rebound.

Jobless Claims Post Jump, Dimming Hopes for Recovery

This just came in fresh. Seems like recovery is going to be hard for US.

http://www.cnbc.com/id/34971879

Bears then Bulls

Now that's pretty scary. Let me tell you the story. US market opened and went into a selldown. At about 12 midnight(SGP time), DOW was selling down at almost 200 pts! S&P went for almost 16 pts! Isn't that scary? Even I was worried (very difficult to fight pyschology) as I'm holding some stocks which profits had dwindled towards my supports. DOW then closed at about -100 pts, a good fight by the bulls. The reason why was many banks reported less than expected earnings other than Wells Fargo. Today, was not so bad in the morning. Actually in stocks went up in Singapore, but suddenly went into selldown again caused by China's decision to tighten lendings. Tonight we will be hearing earnings from Goldman Sachs (GS) and I read that it usually did not fail in expectations. So a rebound tonight.

Dow on 19 Jan 2010

This was not what I expected. A big rise of more than 100 pts. Not really healthy cause this might lead to another sell down. Volume is lesser than the previous trading. Today Singapore stocks opened up high but then slowly sell down in the morning, then followed by accelerated selling in the afternoon. Citibank posted losses on Tuesday night. People are fearing that other banks are also in the red. More likely to be down tonight.

Bull-Shit?

From the Straits Times

Millionaire by 45? It's possible if...

For a graduate couple in Singapore earning median salaries, the goal of becoming millionaires is not too distant, at least on paper. That is, if they save a third of their income from age 25, and invest prudently to earn a modest return of three per cent a year. This does not include non-liquid assets such as property. Singapore website salary.sg says that according to the Ministry of Manpower's report on wages 2008, the median salary for professional in the 25-29 age group is $3,416. Professionals in their late thirties can expect to earn a median salary of $5,048. According to this estimate, their combined income will range from $6,832 to $10,096, and by saving a third of their income every month, they can afford to invest between $2,277 to $3,365 a month. The website claims, "suppose both of you started working at age 25, and always save and invest one-third of your income. If your savings and investments earn just a three per cent rate of return a year, you would have accumulated half a million dollars by age 37 and a full million bucks by age 45". It also says that a couple who are both managers, earning a median salary of $3,860 a month, can become millionaires by age 39, if they save 40 per cent of their income. Some netizens have reacted to this post with enthusiasm, while others were doubtful. One commented that the hypothetical couple must have no children, while some said the blog post assumed that the couple suffered no financial setbacks such as failed investments, retrenchment or expensive medical treatments. However, a financial adviser interviewed by Lianhe Wanbao agreed that by saving conscientiously and investing prudently, this is possible. Financial adviser Mr Dennis Ng told Wanbao that low to medium risk investments can yield a three to five per cent return, so the assumption of a three per cent rate of return is relatively conservative. "If they can invest shrewdly, such as putting a portion of their savings into high-yield stocks, then they can reach their target even faster, but this also entails higher risk." Mr Ng says he earned his first million just 15 years after he started working. He started with a monthly income of $6,000. "I agree that how fast you accumulate your first million is due to two main factors - how much you save and the rate of return of your investments," he said. A poll on the site also asked readers how old they were when they accumulated $1 million in cash and investments. The majority - 50 per cent - said they have yet to reach that goal. Thirty-eight per cent said they had saved $1 million by age 44. However, it is not clear how many people took the poll. One forummer nicknamed "lucky investor" shared that it was possible with the assumption that one's investments do well consistently every year. "I am pretty sure many investors who placed their hard-earned savings with so-called professional fund managers over the last five years would still be seeing a loss, much less any profit. Worse-off are those who invested in structured deposits like credit-linked notes. One has to overcome market volatility, corporate scandals, financial crises and emotions, as well as have a bit of luck to succeed. "Personally I have been quite fortunate in my investments over the past six years, and managed to turn $200,000 capital into $1.25 million through real-estate and stocks," he said. Another forummer "Skeptical" shared that "my wife and I don't club, don't drink, don't smoke, don't drive, hardly shop and I have paid off about $60,000 of loan after five years. I am a month away from 31 years old and I don't even have $10,000 of savings to my name". He also wrote that after graduation, he had to pay off study loans, spent an additional $22,000 on an MBA and purchased an HDB flat in 2007 at the height of the property market. He concluded, "I too would like to save up one third of my salary but it really isn't too realistic if you would like to have your own place and your parents are too poor to help you with the down payment."

Warren Buffet on Sex

By Motley Fool Staff

What does all this have to do with sex, you ask? Well, we already know that Buffett tends to stick to stuff he understands in and out. We also know that his analogies frequently involve sex. Ahem. You can connect the dots yourself. To help you, here are our favorite Warren Buffett thoughts on sex!

Buffett's advice seems to be to start early ... and we ain't talkin' retirement planning:

On being active: "It's nice to have a lot of money, but you know, you don't want to keep it around forever. I prefer buying things. Otherwise, it's a little like saving sex for your old age."

On career advice: "A few months ago I was talking to another MBA student, a very talented man, about 30 years old from a great school with a great resume. I asked him what he wanted to do for his career, and he replied that he wanted to go into a particular field, but thought he should work for McKinsey for a few years first to add to his resume. To me that's like saving sex for your old age. It makes no sense."

On loving your job: "You want to have a passion for what you are doing. You don't want to wait until 80 to have sex."

All this bedroom talk may have you wondering whether Buffett is straying too far outside his primary circle of competence. Not to worry:

On ninja-like focus: "You know, if I'm playing bridge and a naked woman walks by, I don't ever see her."

On due diligence: "Other guys read Playboy; I read annual reports."

On too much diversification: "If you have a harem of 40 women, you never get to know any of them very well."

Of course, maybe we're underestimating how large his circle is:

On internal yardsticks: "Would you prefer to be the greatest lover in the world and known as the worst, or would you prefer to be the worst lover and known as the greatest?"

Sometimes opportunity knocks -- gather ye rosebuds while ye may:

On investing in 1973: "I feel like an oversexed guy on a desert island. I can't find anything to buy."

On investing in 1974: "I feel like an oversexed man in a harem. This is the time to start investing."

An indecent proposal:

On selling your business to Berkshire vs. private equity: "You can sell it to Berkshire, and we'll put it in the Metropolitan Museum; it'll have a wing all by itself; it'll be there forever. Or you can sell it to some porn shop operator, and he'll take the painting and he'll make the boobs a little bigger and he'll stick it up in the window, and some other guy will come along in a raincoat, and he'll buy it.''

Buy and hold ain't dead:

On becoming a true investor: "We believe that according the name 'investors' to institutions that trade actively is like calling someone who repeatedly engages in one-night stands a 'romantic.'"

Some insights into the current economic situation that make us wonder which of these he's tried:

On the first stimulus package: "[It was like] half a tablet of Viagra and then having also a bunch of candy mixed in -- it doesn't have really quite the wallop."

Solicited to buy Bear Stearns, and asked if he wanted more information (from the book Street Fighters) : "It was sort of like having a woman standing in front of you who had taken half her clothes off and then asked whether she should continue, [Buffett] thought. Just as he'd want the woman to finish the job, he was certainly curious to hear what was happening that weekend with the embattled Bear."

On the speed of economic recovery: "You can't produce a baby in one month by getting nine women pregnant. It just doesn't work that way."

Buffett knew a girl who knew a guy who knew a credit default swap:

On financially transmitted diseases: "Derivatives are like sex. It's not who we're sleeping with, it's who they're sleeping with that's the problem."

Selldown

Well, DOW went on a huge selldown of about 1% having a 100 pts drop on Friday lead by banks. Volume was high indicating strong sentiment to sell (must be panic selling). I have been noticing alot of 1 day market drops of over 100 pts since november, and then a rebound. DOW closes at support so we my see a slight rebound on monday or if it is still bad then it will break support and continue selling.

Another high

Well, Thursday's jobless claims posted disappointing results as jobless claims rose and US retail sales fell 0.3%. But market gave a late rally due to banks. It's earnings season in January so I estimate that January will be a bullish month provided the earnings are good. As for Singapore side, STI is going up but I see many stocks are either stalling or dropping.

The Little Book of Investing

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You can now purchase the book for just US$2.99 only! It is a small price to pay for a BIG future in your investments and wealth growth! Please feel free to email me at thetippoint@gmail.com to purchase this excellent book specially written for beginners! BUY NOW!

Recession comes with War?

A very very very interesting topic. Recession comes with war. No one likes war, but war is the one which made technology advance at the fastest rate. If one looks back at World War I and II, many of our today's everyday uses came from secret projects during the war.

Where's the War?

DOW moving up

Well! I'm sure many of you had a huge scare on Wednesday as markets tanked that night, wondering whether will it be the start of the correction? DOW rose again yesterday night as banks, pharmas rose. Banks defended their reason to give out big bonuses to their employees last night. Tonight will be US jobs data, so the market make or break will depend on tonight and Fri's Job report.


Some extra news report*

China Accelerated Stimulus Exit Signals Higher Rates

By Bloomberg News
Jan. 13 (Bloomberg) -- An unexpected shift by China’s
central bank to restrain lending may foreshadow higher interest
rates and a relaxation in the nation’s currency peg against the
dollar.
The People’s Bank of China yesterday raised the proportion
of deposits that banks must set aside as reserves by 50 basis
points starting Jan. 18. Economists hadn’t anticipated the move
until at least April, the median of 11 forecasts in a Bloomberg
News survey showed last week.
Policy makers may follow up by raising their benchmark rate
in coming months, rather than waiting until the second half of
the year as most economists in the survey had projected. By
moving ahead of the Federal Reserve, which plans to keep rates
near zero for an “extended” period, pressure will rise to
allow the yuan to appreciate for the first time since mid-2008.
“Higher benchmark lending rates and a stronger yuan will
also need to be part of the package,” Brian Jackson, senior
emerging markets strategist at RBC Capital Markets in Hong Kong,
said after yesterday’s decision. “Early action now” is “more
likely to prevent the need for very sharp tightening further
down the road,” he said.

Impact on Stocks

Stocks fell after the announcement late yesterday, with the
MSCI Asia Pacific Index losing 0.4 percent to 125.94 as of 8:37
a.m. in Hong Kong. Japan’s 225 Stock Average dropped 0.3 percent,
and the Standard & Poor’s 500 Stock Index closed down 0.9
percent in New York.
“Authorities had reason for concern because the banks in
China clearly had not gotten the message to clamp down on
lending,” Eswar Prasad, a senior fellow at the Brookings
Institution in Washington, said in an interview on Bloomberg
television from Hong Kong.
Banks lent about 100 billion yuan ($14.6 billion) each day
last week, the official China Securities Journal reported this
week. That compares with 294.8 billion yuan for all of November.
Along with the reserve ratio, the PBOC has increased rates
at bill auctions in the past week. The bank guided three-month
bill yields higher for the first time in 19 weeks a Jan. 7
auction and followed with a similar step at a sale of one-year
bills yesterday. The central bank has kept the benchmark one-
year lending rate unchanged at 5.31 percent since late 2008.

‘Pre-empt’ Bubbles

“This series of moves by the central bank provides a clear
sign that policy makers are following through on their pledge to
guide credit in order to pre-empt rising inflation and avoid
asset price bubbles,” said Jing Ulrich, chairwoman of China
equities and commodities at JPMorgan Chase & Co. in Hong Kong.
Along with further reserve-ratio increases and lifting the
benchmark rate, officials may let the yuan climb by 3 percent to
5 percent this year, Zhu Jianfang, chief economist at Citic
Securities Co. said in an e-mailed note. Jackson at RBC
forecasts the currency will strengthen about 5 percent, to 6.5
per dollar.
Authorities have kept the yuan at about 6.83 per dollar
since July 2008 after letting it appreciate 21 percent over
three years. Bets that the exchange rate will strengthen have
contributed to inflows of money from abroad -- China’s foreign
exchange reserves, the world’s largest, surpassed $2 trillion
last year.

‘Hot Money’

Part of that currency build-up may be speculative capital
or “hot money,” Fan Gang, the academic member of the central
bank’s monetary policy committee, said on Dec. 28. Such inflows
“will cause asset bubbles,” he said. Zhang Xiaoqiang, deputy
head of the National Development and Reform Commission, said on
Jan. 5 that the nation may see “huge” inflows of hot money as
foreign investors step up bets on yuan gains.
The existing reserve-ratio level for big banks is 15.5
percent, and 13.5 percent for smaller banks. China began
reducing banks’ reserve requirements in September 2008 from a
high of 17.5 percent as the global financial crisis deepened,
part of a monetary loosening that included the biggest single
interest-rate cut since the 1997-98 Asian financial crisis.
In November 2008, the central bank named Industrial &
Commercial Bank of China Ltd., Agricultural Bank of China, Bank
of China Ltd., China Construction Bank Corp. and Bank of
Communication Co. as among those classed as bigger lenders for
reserve requirements.

Wen’s Pledge

The decision indicates increasing concern in Premier Wen
Jiabao’s government that a continuation of the record 9.21
trillion yuan of loans in the first 11 months of 2009 will
create a bubble in property and stock prices. Wen pledged Dec.
27 to curb excessive property-price gains in some parts of China
after the biggest nationwide increase in 16 months in November.
China’s large amount of maturing bills, along with its
stimulus measures, mean it has more liquidity than other nations,
a People’s Bank of China official said on condition of anonymity
yesterday. Policy makers are stepping up measures to address
financial risks, the official said.
Yesterday’s decision will help remove about 300 billion
yuan of liquidity, according to estimates by Xing Ziqiang, an
economist in Beijing at China International Capital Corp., the
top-ranked China local brokerage by Asiamoney magazine last year.
It will help ease the risk of a flood of cash into the economy
when about 1 trillion yuan of PBOC bills mature from mid-January
to mid-February, Xing said.

Inflation Outlook

Inflation risks are rising in China as the economy picks up
speed. Exports rose for the first time in 14 months in December,
trade data showed on Jan. 10. A government report this month is
forecast to show gross domestic product increased 10.5 percent
in the fourth quarter from a year before, the most since
January-to-March 2008, a Bloomberg News survey indicates.
Economists are ratcheting up 2010 inflation forecasts for
China. Citic Securities Co., the nation’s biggest listed
brokerage, raised its estimate to 3.2 percent from 2.6 percent
in a report dated yesterday. Bank of America Merrill Lynch last
week increased its forecast to 3.1 percent from 2.5 percent.
Yesterday’s announcement “sends a pretty strong signal
that a more substantive tightening is probably coming,” said
Mark Williams, senior China economist at Capital Economics Ltd.
in London, who worked at the U.K. Treasury as an adviser on
China from 2005-07. “It warns banks and it warns firms that
they’re going to face higher interest rates down the road.”

What Kind of Trader Are You?

While the markets are down, why not try this personality test to find out what kind of trader are you? It's really accurate!

Fed Posts Record Earnings From Fighting Financial Crisis

Some important news that could pull up US.

http://www.cnbc.com/id/34818508

Dow probably down

The DOW certainly pushed higher last night. First it opened up, then went down forming a hanging man. Finally it ended positive. However, today Asia went down due to China's tightening policy on it's short-term liquidity. Further adding to tonight's direction will be Alcoa's disappointing earnings result. So tonight we might see markets going down for a slight correction. But bulls seem to still remain strong.

Market may move higher?

Friday posted disappointing Jobs report. Market fell sharply once the news got out, it later recovered all losses and pulled a gain forming another "hanging man". Will it go higher again? Or a reversal is coming? The momentum is still pushing the market higher, I think.

Bears and shortists

I came across a book talking about the bears of the market. It is really interesting that shortist (people who short sell a stock) are one of the most hated and unappreciated traders in the trading world. Why? They are the ones who bring down the price of the stock and Wall Street doesn't like it. Famous shortists who made millions of dollars during the bear market were never really held in honors. The reason is people hated these people and will do anything to hunt them down. If you are a huge shortseller in the market, Wall Street will hunt you down, prevent you from shorting and try to force you to cover all that you shorted till near bankruptcy. These are the some of the hidden stories that most will never know. But somehow, shortists do have some sort of purpose in the market, they prevent the market from going to far and maintain the appropriate price level.

Another is the the presence of bearish people who warn people of a top in the market. They are somehow similar to the "boy who cried wolf". Cause despite many warnings, Wall Street did not heed them and turn a blind eye to it. And when it happens, no one was prepared for the crash of market. This was what happened in the 2008 financial crisis. In 2007, stocks were up so much everyone was in euphoria, suggesting that it will go even higher. Some discovered the cracks in the US housing crisis and tried to warn everyone but was shunned. And there, bad news started to pour in, US was actually in recession, everything just snowballed. The top of the market is really hard to tell.

Interesting huh.

Consolidation?

The DOW movement for the past two days has left me clueless about it's direction now. Looking at it, it's probably moving downwards slowly and it is uncertain about it's direction based on candlestick psychology. There is both bull and bears fighting each other. Jobs losses report last night provided good news plus an upbeat in the service sector managed to pull the DOW up. Everyone's waiting for Friday's job report.

The relationship between gold and dollar

This is an interesting read, will the gold prices start to collapse?

Read it on cnbc.

http://www.cnbc.com/id/34726312

Seems like a good year

Congrats to all, seems like we will have a good year for 2010. DOW JONES was up by 155.91 points, reaching a new high. STI index and Hang Seng was slightly negative on the first day of trading though, so I wonder STI will be as good as the DOW?

Stock Picks for 2010

It's a new year now, so what are the stock picks that everyone will be looking at in 2010?

Here are some of my views on stock picks for 2010:

Oceanus - They just successfully launched a listing in Taiwan. Given that Chinese New Year is coming, the sales of abalones will increase.

SAT Services (SATsvs) - Acquisition of Singapore Food Industries (SFI) gave them a good diversification from airport services and as the economy is recovering, more will travel. Plus with the opening of the IR in 2010, we are expecting more tourists to come to Singapore.

SIA - The airline in Singapore widely known to offer one of the best services in the world. Travel statistics is improving as well as passenger loads as the economy recovers.

Commodities related company (Noble group, Wilmar, Olam) - With low interest rates, commodities will still perform.

Property (Kepland, Capitaland, Allgreen, CDLHtrust) - High end properties seems to be still appreciating despite cooling down.

Metals - The economy is recovering, so metals will start to move up as industries need metals for constructions and such.

Anwell Tech - It will start its production of its new, first in the world thin solar panels in early 2010 and with China going for solar energy, this might be a gem.

Tip: The first trading day of a new year is the most important in generalising the trend of the stock market for the whole year. If the first day is up, then most probably the market will do well in that year. If it is down badly, be ready for another bear market or the next recession.

Happy New Year

Happy New Year to all. It's 2010! A whole new beginning for a new trading day! Good luck to all investors!