Tomorrow, we might see a doji for KLCI
Monday, June 1, 2009
3:33 pm - Here is a swing trade for IOI Corp !
Buy if it take out the high of IOI Corp today at Rm4.63 and put your stop at rm4.80.
10:17 am - Market Report II by Bill Wermine
Dear Traders,
Continue to run your long gold position as the US Dollar Index broke major support at 80.00 Friday and appears to be in freefall. Use an ATR risk on futures/ ETF/spot gold which is at USD 865. If gold breaks USD 1000 we will raise our stop again. To hold our position we must give at least USD 110 stop. Any less than that the natural volatility will take you out.
You can use this risk benchmark for your purchases in the Am Precious metals fund
Sir charts, my research service run by Gary Dorsh a former CME floor trader reports the Russians/ Chinese are quietly selling their long dated US T bond holdings.
The US treasury is denying this so it must be true. If the Chinese/ Japanese / Russians/ brazil slows funding the US deficits, higher interest rates are the result and Dow collapse is in the cards.
The bond market vigilantes are trying to pull the plug on Quantatative Easing and impose discipline on Obama and his free wheeling democrats.
in Washington. If Obama does not heed this warning it could leed to Sharply higher interest rates which can choke off the recovery and cause world stock markets including the Dow Jones to collapse and break the March lows.
Other headwinds are sharpy higher crude oil/ grain and precious metals prices. These markets are not fooled by the Obama smokescreen and the propaganda from CNN/ CNBC/ .
For our KLSE positions we deal in consumer/ plantation/water and power shares and high quality dividend shares. Avoid manufacturing , property and banking issues.
We must maintain our defensive strategy and lock in profits as our shares reach resistance areas such as Dutch Lady . I took profit on F & N and added Guiness,JTI tobacco and Nestle- all dividend payers for our managed accounts.
Do not get caught up in the media/ stckbroker hyping machine.
Our shares are defensive as people will drink beer and smoke when they are depressed. In fact studies show that tobacco and alcohol consumption goes up when the economy slows down.
The AUD is also well supported and that helps our Man investments. I anticipate a positive performance from Man in the next reporting period- their models support catching the US Dollar collapse and rise in commodities.
Have a good week and stay the course.
Bill
Continue to run your long gold position as the US Dollar Index broke major support at 80.00 Friday and appears to be in freefall. Use an ATR risk on futures/ ETF/spot gold which is at USD 865. If gold breaks USD 1000 we will raise our stop again. To hold our position we must give at least USD 110 stop. Any less than that the natural volatility will take you out.
You can use this risk benchmark for your purchases in the Am Precious metals fund
Sir charts, my research service run by Gary Dorsh a former CME floor trader reports the Russians/ Chinese are quietly selling their long dated US T bond holdings.
The US treasury is denying this so it must be true. If the Chinese/ Japanese / Russians/ brazil slows funding the US deficits, higher interest rates are the result and Dow collapse is in the cards.
The bond market vigilantes are trying to pull the plug on Quantatative Easing and impose discipline on Obama and his free wheeling democrats.
in Washington. If Obama does not heed this warning it could leed to Sharply higher interest rates which can choke off the recovery and cause world stock markets including the Dow Jones to collapse and break the March lows.
Other headwinds are sharpy higher crude oil/ grain and precious metals prices. These markets are not fooled by the Obama smokescreen and the propaganda from CNN/ CNBC/ .
For our KLSE positions we deal in consumer/ plantation/water and power shares and high quality dividend shares. Avoid manufacturing , property and banking issues.
We must maintain our defensive strategy and lock in profits as our shares reach resistance areas such as Dutch Lady . I took profit on F & N and added Guiness,JTI tobacco and Nestle- all dividend payers for our managed accounts.
Do not get caught up in the media/ stckbroker hyping machine.
Our shares are defensive as people will drink beer and smoke when they are depressed. In fact studies show that tobacco and alcohol consumption goes up when the economy slows down.
The AUD is also well supported and that helps our Man investments. I anticipate a positive performance from Man in the next reporting period- their models support catching the US Dollar collapse and rise in commodities.
Have a good week and stay the course.
Bill
10:10 am - AirAsia is trading share !
Dear KY Lau,
It is a share that I wud not carried it i.e buy and hold !
When good news comes out i.e. net profit is up, shares will drop as "sheep" wud only buy at good news. If the good news i.e. net profit is good, Airasia price wud hold and continue its uptrend.
A good example of moving up on good news wud be PB Bank with strong fundamental and earnings and income growth.
It is a share that I wud not carried it i.e buy and hold !
When good news comes out i.e. net profit is up, shares will drop as "sheep" wud only buy at good news. If the good news i.e. net profit is good, Airasia price wud hold and continue its uptrend.
A good example of moving up on good news wud be PB Bank with strong fundamental and earnings and income growth.
9:51 am - Market Outlook by Bill Wermine
Dear Traders,
Many of you who invested in Man are concerned about the Australian Dollar. We should be as the our capital guarantee is in AUD government bonds and the Man funds are denominated in AUD.
Tan Teng Boo, CEO of I Capital who has a solid track record as a fund manager and analyst shared his AUD research in the latest issue of I Capital and it may answer your concerns about the AUD versus the RM.
The foreign exchange rate between the Ringgit and the AUD is determined substantially by 2 key factors.
The first is Malaysia's political and economic future while the second is Australia's economic prospects.
1st quarter GDP in Malaysia was a steep 6.2 % contraction and the 2nd quarter should also show contraction. Positive growth should emerge in the 4th quarter as well as the Australia, China, Japan and most Asian economies.
Short term recovery should not be a problem; what is the problem is long term growth which means sustained productivity gains- this might be difficult as the Malaysian economy needs to urgently implement many reforms to restructure the Malaysian economy. There are many uncertainties here. Australia does not face these problems.
At the same time the economic prospects for Australia look bright. The long term prospects of this huge country are tied to the longer-term prospects of China and the rest of Asia. The key drivers of recovery in the short term are the relatively resilient Australian economy, a credit crunch which is much less severe, the ability to undertake fiscal stimulus, an undersupplied hou sing market and the commodities demand from China and the rest of Asia.
Although China has been expanding rapidly for the last 30 years, she still has a long way to go to catch up with the developed economies. There is huge potential demand for refigerators that remains untapped for the 100s of millions of Chinese and that will take plenty of iron ore and coal. A torrent of demand for commodities will be unleashed. Australia who is physically nearer to China compared to Brazil or Canada will be the competitive supplier of these commodities.
Over the course the AUD should be a net gainer. Since 1983 the RM has traded between 1.60 to 3.10. The trend over the last 25 years is up for the AUD/RM cross. Yes there are gut wrenching corrections as we have just experienced but the up trend is clearly defined. Relative weaking periods are shorter than the strengthening periods. Who said it is easy ?
In the current US Dollar collapse and the rush to commodities including gold and crude oil coupled with China, Russia, Brazil and Japan cutting back their purchases of US Treasury bonds there is a chance the AUD will break out above the 3.10 rate and move into unchartered waters.
If this happens, you who hold Man AUD Diversified will be very happy.
Also for those who hold KLSE plantation, rubber and commodity shares as well as long CPO futures should also benefit.
The rich diversity of natural resources in Malaysia will always support the RM versus most world currencies including the US Dollar/ UK Pound/ Euro and Yen. The AUD and SGD should outperform based on my currnent trends.
I hope this answers the many questions I have been asked about the AUD/ RM exchange rate.
If you should have any others please feel free to ask me.
Have a good week,
Bill
Many of you who invested in Man are concerned about the Australian Dollar. We should be as the our capital guarantee is in AUD government bonds and the Man funds are denominated in AUD.
Tan Teng Boo, CEO of I Capital who has a solid track record as a fund manager and analyst shared his AUD research in the latest issue of I Capital and it may answer your concerns about the AUD versus the RM.
The foreign exchange rate between the Ringgit and the AUD is determined substantially by 2 key factors.
The first is Malaysia's political and economic future while the second is Australia's economic prospects.
1st quarter GDP in Malaysia was a steep 6.2 % contraction and the 2nd quarter should also show contraction. Positive growth should emerge in the 4th quarter as well as the Australia, China, Japan and most Asian economies.
Short term recovery should not be a problem; what is the problem is long term growth which means sustained productivity gains- this might be difficult as the Malaysian economy needs to urgently implement many reforms to restructure the Malaysian economy. There are many uncertainties here. Australia does not face these problems.
At the same time the economic prospects for Australia look bright. The long term prospects of this huge country are tied to the longer-term prospects of China and the rest of Asia. The key drivers of recovery in the short term are the relatively resilient Australian economy, a credit crunch which is much less severe, the ability to undertake fiscal stimulus, an undersupplied hou sing market and the commodities demand from China and the rest of Asia.
Although China has been expanding rapidly for the last 30 years, she still has a long way to go to catch up with the developed economies. There is huge potential demand for refigerators that remains untapped for the 100s of millions of Chinese and that will take plenty of iron ore and coal. A torrent of demand for commodities will be unleashed. Australia who is physically nearer to China compared to Brazil or Canada will be the competitive supplier of these commodities.
Over the course the AUD should be a net gainer. Since 1983 the RM has traded between 1.60 to 3.10. The trend over the last 25 years is up for the AUD/RM cross. Yes there are gut wrenching corrections as we have just experienced but the up trend is clearly defined. Relative weaking periods are shorter than the strengthening periods. Who said it is easy ?
In the current US Dollar collapse and the rush to commodities including gold and crude oil coupled with China, Russia, Brazil and Japan cutting back their purchases of US Treasury bonds there is a chance the AUD will break out above the 3.10 rate and move into unchartered waters.
If this happens, you who hold Man AUD Diversified will be very happy.
Also for those who hold KLSE plantation, rubber and commodity shares as well as long CPO futures should also benefit.
The rich diversity of natural resources in Malaysia will always support the RM versus most world currencies including the US Dollar/ UK Pound/ Euro and Yen. The AUD and SGD should outperform based on my currnent trends.
I hope this answers the many questions I have been asked about the AUD/ RM exchange rate.
If you should have any others please feel free to ask me.
Have a good week,
Bill
9:24 am - KLCI is moving sideway to up.
It had a bit of resistance to break into 1060 resistance level !
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