4sept Luckily I stick to my TA signals……..

Singapapore stock market wrap 4th sept08

As i look at the closing prices across the board for SGX, especially singapore listed S-chips today, i cannot help but feel glad i manage to follow my TA signals strictly.  Recall 2 days ago i mentioned that there could be a “potential” rebound on the cards based on the closing prices.  But valid entry signals for some of the singapore listed stocks that i like such as ferrochina, sino environment and china XLX will only present themself provided the breakout signals are triggered!

Since the breakout signals were not triggered, it means we just sit back and wait again…… I am determined not to make some of the mistakes that i have made before.  In the past, when i saw stock prices sliding down to levels which i thought look attractive based on fundamental analysis, but even when TA signals look bad, I would try to justify or anticipate that a rebound just have to come since they look so “cheap”.  I have learnt and paid the price few times for these mistakes and realized that “cheap” is a relative term based on FA.  A stock can trade at 25x PE and still go higher when market is hot and vice versa……it can trade at 5x PE and still drop to 2.5x PE when market is cold!!  This is exactly what is happening right now……….for many singapore shares which reported strong earnings only to see the stock prices sliding down further.

I would say market liquidity and sentiment are bigger drivers of stock price movement than corporate earnings.

I am now back to square one again…..because the potential rebound signals that i saw have been invalidated with the sell down today.  I just have to wait patiently for the next signals……..just like Alex Ferguson had to wait patiently before he finally capture Dimitar Berbatov.

happy waiting

rooney