Dow - Be careful, be very careful

Dow (17,828)

Out of 19 trading days in November, Dow set new record high on 12 days. I think this is a record by itself. But there were no high record volumes and there was no euphoria. The current record bull run is so different from those good-old-day euphoric record setting bull run. May be because this is purely a liquidity driven run, an assets bubble run, and the bubble can burst anytime. So, be careful, be very careful.

FBMKLCI ( 1,820)

As long as Dow can hold, I will continue to maintain my present wave count for KLCI. It is on its wave c of its mini wave 2. Hopefully it can begin its mini wave 3 soon.

Hopefully KLCI can proceed to complete its wave d by early 2015.

KSL Holdings Bhd (Rm 4.54)

On Friday, the AGM has approved the proposed 1 for 1 bonus issue as well as the dividend reinvestment plan. KSL has also announced its 3rd quarter earning of 18.14 sens per share. Its net assets per share is Rm 3.87.

Earning for the first months reached 54.33 sens. Kenanga expects KSL to earn at least 78 sens a share for 2014 and 97 sens a share for 2015 (based on its current number of paid up share of 386 million)

Hopefully KSL can continue with its sub-wave iii next week.

Priceworth International Bhd (Rm 0.185)

PWorth has announced a positive earning of 0.23 sen a share after many many quarters of losing money. It has also announced quite a high figure for its October logs output of 9,485 cu.m. Hopefully it can slowing improve it monthly logs output from the current level to its estimated 100,000 cu.per month by 2017.

If 100,000 cu.m a month can be achieved by 2017 and KSL can increase its integrated timber mills operation from its current 30% of its available capacity to more than 70%, PWorth is going to be a goldmine. But, I am still worry about the assets bubble and when it will burst. 2017 is a long time to go. Sigh !

Malayan United Industries Bhd (Rm 0.27)

After suspended its share for 3 trading days, Mui announced on last Tuesday that the company is engaged in discussion with a potential party to explore the possibilities of disposing certain substantial assets of the company.

Currently Mui is forming its major wave 5. The stock opened with a gap on Wednesday, has a pullback on Thursday on thin volume and started to move higher again on Friday with high volume. This looked interesting. There were speculation that Mui may dispose its London Hyde Park Corus Hotel for £200 million or Rm 1.05 billion.

Mui is currently forming the sub-wave i of its wave (iii) of major wave 5.

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Dow - I am getting nervous as it moves higher

It is interesting to note that Warren Buffett's Berkshire Hathaway is keeping US$55 billions cash, a record high for Berkshire. Is he slowly building up his protection against any possible downside ?

Click ' Buffett Builds US$55b Green Pile' for the article published on 21st August, 2014.

Frankly speaking I am getting more and more nervous as Dow moves higher and higher with more record highs.

If Dow is well behaved, it will form its next minor wave ix. After completing its mini wave 3, it will then form its mini wave 4 and 5 and then my next question will come, "Is that the end of wave (xiii) ?"

 As wave (xiii) can be the end of Dow's major wave (5) unless it continues to form wave (xiv), (xv) and (xvi). The worst is when this major wave (5) is also the end of its mega wave 1.

Since the March 2009's low of 6547, Dow gained 70% for its major wave (1), 32% for its major wave (3) and until now its has gained 67% for its current wave (5) that has yet to complete. The only thing that gives me some comfort is the theory that 'wave 3 cannot be the shortest wave'. But, don't forget the Murphy's Law.

For the current major wave (5), wave (xiii) has gained 10.6% so far, the magnitude is about there. Be careful.


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FBMKLCI - wave 3 of d

FBMKLCI (1,833)

KLCI added 24 points (+1.3%) to end Monday's trading at 1,833. It appeared to me that mini wave iii of the wave 3 of d has started.

Wave d of major wave 4 is expected to last until early 2015. I expect wave e of 4 to take place during first quarter of 2015 follows by the major wave 5.

I hope I am right and more important, my stocks must moved.

Dow - Wave (xiii) moves on

Dow (17,810)

In an unexpected move, China's central bank cut interest rate on Friday. At the same time in Frankfurt the President of the European Central Bank (ECB) said the ECB will use more aggressive measures to prevent the Euro Zone from falling into a new crisis.

Dow has a jump start on Friday morning and moved to an intra-day high of 17,894. It closed at 17,810 for a 91 points gain (+0.5%), another new record high, its 9th new record in November.

I am assuming the Friday's surge as the minor wave vii of mini wave 3, but whether this is the sub-wave i of wave (xiii) or it is the wave (xiii) itself, I really have no clue.

And whether the end of this wave (xiii) is going to be the end of major wave (5) or the end of mega wave 1, I also have no clue. 

Hopefully the next pullback is only a small mini wave 4 correction follow by mini wave 5 surge for more new record highs until early next year when wave (xiii) is expected to end. But who knows, Dow may continue to move higher with mini wave 6, 7, 8 and 9. Anything can happen in stock markets. 

In 2012, I thought Dow will end at its wave (v) but it continued to run until wave (ix) by end of 2013. It refused to end there too. It then continued to move on to the current wave (xiii). Will  there be wave (xiv), (xv), (xvi) and (xvii) in front. I don't know, don't ask me. Some Gurus have been looking for a major drop for the last 2 years but Dow moved higher by another 40% within 24 months.

FBMKLCI (1,809)

KLCI is forming the minor wave ii. Hopefully it can start its minor wave iii of 3 of d next week.

Jasa Kita Bhd (Rm 0.235)

I hope Friday's drop is the minor wave ii.

Berjaya Corporation Bhd (Rm 0.475)

Has it completed its mini wave 2 ?

KSL Holdings Bhd (Rm 4.36)

From its 10-year chart, I am pretty sure KSL is either forming its wave (iv) or wave (v) at this moment.

Since I am expecting a good earning announcement and I am expecting the shareholders to approved the 1 for 1 bonus issue next week, I read the current correction as the sub-wave ii of its wave (v).

But it is also possible that it may drop for another 3 days to complete the wave c of its wave (iv) before the announcement of its Q3 earning and before the EGM on 28th November.

Small fish is always at the mercy of the big fish. Sigh !


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Jasa Kita Bhd

Jasa Kita Bhd (Rm 0.24)

Jasa Kita surprised me by making a powerful U-turn after closing the gap at 20 sens. It appeared to me that it is forming its mini wave 5 of sub-wave i.

If its current up-trend is the wave D of its mega wave (2), Jasa Kita has a possible high of 45 sens if it can reach the upper trend-line.

Dow (17,179)

Dow closed with another new high on Thursday, its 8th record high for November. Most followers of Dow are expecting a pullback. I just worry that the higher it goes without a meaningful correction, the harder it will fall when the correction comes.

Hopefully its next pullback marks only the end of its sub-wave i of wave (xiii) and not the end of wave (xiii).


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FBMKLCI - Wave 3 of d started ?

FBMKLCI (1,824)

KLCI added another 6 points and it looks more likely that wave 3 of d is in progress.

Jasa Kita Bhd (Rm 0.215)

Instead of moving higher, Jasa Kita moved lower on Wednesday to form a wave c for its mini wave 4. It may go to the 20 sens level to close the gap that was formed by the surge 5 days ago.

KSL Holdings Bhd (Rm 4.55)

Finally KSL closed the day with a small green candlestick. Can this be the starting of mini wave 3 of sub-wave v ?

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Dow - Refused to end its sub-wave iii

Dow (17,687)

Dow continues to set its 6th record high in November. It closed at 17,687 on Tuesday to start its mini wave 7 of its sub-wave iii of wave (xiii).

FBMKLCI (1,818)

KLCI gained 12 points to closed at 1,818 on Tuesday. Is this the first candlestick of wave 3 of d ? We will know on Wednesday.

If Dow can repeat its last few months performance until mid 2015, KLCI will have time to complete its major wave 4 and 5.

Jasa Kita Bhd (Rm 0.235)

My friend has asked me to have a look at Jasa Kita, a company with about 450 million paid-up shares, that manufacture and sell electric motors, power tools and other Engineering and Industrial equipments. The company also provides logostics related services.

Two weeks ago it announced its 2nd quarter earning of only 0.43 sen a share. Its net assets per share is 20 sens. Annualised PE is about 14.

Its started to move side-way since 1998 to form its major A-B-C-D-E mega wave 2.

At a glance, it appeared that it has just completed its wave D and is about to move all the way to 10 sens to form the wave E of its mega wave (2).

 

However, a closer study shows that there is another possibility that it may not have completed its wave D yet and is currently forming the wave (v) of its wave 3 of D that has a possible high of 45 sens if D can reach the upper channel line.

From the 6-Month chart, it has completed its mini wave 1, 2, 3 and 4. It formed a green engulfing candlestick on Tuesday, is this the starting of its mini wave 5 of its sub-wave i ? My guess is as good as yours.

I wish my friend good luck if he wanted to trade in this stock. As usual my interpretation can be wrong, so he has to trade at his own risk.


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Dow - Is wave (xiii) about to finish ?

Dow closed Monday trading with a marginal gain of 13 points. It formed another 'doji', sub-wave iv is about to start. The main concern now is - Dow is about to end its wave (xiii).

Based on the magnitude of its wave (ix) of 12% gain and its wave (xi) of 11.4% gain, and assuming wave (xiii) can gain an average of 11.7%, Dow has only another 2.3% to go, or another 370 points to go to complete its wave (xiii).

If wave (xiii) is going to be the end of its major wave (5) or mega wave 1. I think Dow is approaching a possible danger zone. In my previous posts I thought the wave (xiii) could last until early 2015 but it appeared that it may not.

Unless major wave (5) has more than 13 waves, then the next correction can be wave (xiv) after the completion of wave (xiii).

But if major wave (5) has only 13 waves then the next correction at best is the major wave (6) pullback and worst to come is the mega wave 2 scenario.

Be careful, be very very careful. And again this is only my interpretation of Dow and I can be wrong too.


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Weekly Update

Dow (17,634)

Dow closed the week at 17,634. It appeared to me that it has completed its mini wave 5. If sub-wave iii has only 5 waves, it is likely that Dow will form the sub-wave iv of its wave (xiii) next week.

Be very careful when wave (xiii) is completed because it could be the end of its major wave (5) or mega wave 1.

 

FBMKLCI (1,813)

KLCI continues to form its wave 2 of its wave d. Does it need to wait for Dow to complete its sub-wave iv before it can start its wave 3 of d ?

Berjaya Corporation Bhd (Rm 0.48)

BJ Corp is about to complete its mini wave 2. The worst that can happen is a 100% retracement to 47 sens.

KSL Holdings Bhd (Rm 4.50)

Same as BJ Corp, KSL is on its way to complete its mini wave 2.

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A Historic Link

Come next Monday, 17th November 2014, for the first time, Chinese retail investors from Mainland China can buy foreign shares directly when the long-awaited trading link between Hong Kong and Shanghai starts to operate.

Hong Kong Exchanges and Clearing chief executive 

Charles Li (left) and chairman Chow Chung-Kong

This 'Link' will provide a channel for Chinese individual investors to start moving some of their 50 trillions Chinese Renminbi of private wealth into oversea stocks. It also allows foreigners to buy more China stocks.

Click 'Hong Kong - Shanghai Trading Link' for details.

This is going to have a great impact on equity and currency markets.


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Dow - wave (xiii)

Dow (17,612)

Dow closed its Wednesday session at 17,612. For two days Dow ended on a mixed note forming 2 'doji' candlesticks. If Dow is not forming its minor wave vi then it is forming its mini wave 4 of sub-wave i of its wave (xiii).

Dow is at the tail end of its sub-wave i, it may take another week to finish it. The upper channel line may provide solid support to sub-wave ii. Sub-wave iii of wave (xiii) will set more new record highs in December.

FBMKLCI (1,816)

KLCI dropped another 8 points to continue with its wave c of 2. It may take another two to three days to complete its wave 2.

KSL Holdings Bhd (Rm 4.54)

KSL moved to a high of Rm 4.67 before sellers pushed it down to close at Rm 4.54. If it can continue to climb higher with good volume, it may be able to run until end of November to form its mini-wave (iii) of sub-wave v.

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Berjaya Corporation Bhd

Berjaya Corporation Bhd (Rm 0.485)

BJ Corp formed its first green candlestick after a week of correction. Is that the signal that mini wave 2 has ended ?

BJ Corp has been in the down trend since April 2010 forming the wave C of its mega wave (2). It may be too early to say that its mega wave (2) has ended, more confirmation is needed, but the bullish 5 little waves formation is a positive sign.

Bonescythe has a long writeup on this stock in September. Click 'BJ Corp - The Rise of The Empire' for the article.

If my reading is right and if the 47-sen level is indeed the base, it is possible that the mega wave (3) of BJ Corp has started. I am keeping my fingers crossed.


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Weekend update.

Dow (17,573)

Dow closed the week with another new record high. From the candlesticks it is quite obvious that the run is losing momentum. Mini wave 3 may end anytime. Mini wave 4 may take one or two days to completed. Mini wave 5 of sub-wave i can be quite unpredictable.

The upper trend-line is likely to provide a strong support for the sub-wave ii correction.

FBMKLCI (1,824)

KLCI continues to form the wave 2 of its wave d. It appeared to me that the magnitude of wave 2 is about there. Hopefully wave 3 of d can start next week.

I expect wave d to run until first quarter of 2015.

KSL Holdings Bhd (Rm 4.56)

KSL continues to form the mini wave (ii) of its wave (v). I hope I can see the starting of mini wave (iii) next week. Wave (v) is likely to be completed by end of November or early December after the announcement of its 3rd Quarter earning and the approval of the one for one bonus issue plus the proposed Dividend Reinvestment Plan.

From a longer term perspective, if wave (v) is the end of major wave 3, it will be followed by major wave 4 correction before the final major wave 5 surge to complete its mega wave (3). The major wave 4 correction, if inline with KLCI's wave e correction, it may last about 3 to 4 months.

Based on my projection, mega wave (3) may reach Rm 8.00 ( or Rm 4.00 after adjusting for the 1 for 1 bonus)  before end of 2015 provided the Dow can hold. 

Please remember, I can be wrong. 


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