I must admit, i haven't been able to capitalized a lot of trading opportunities that the market showcased itself during this turbulent downtrend of the STI. I made some wrong calls, however i am able to justify those calls if anyone would to question me. On the brighter side, this downturn present yet another trading opportunity on the short side which i think would be fast and furious where one can make money fast.
Looking at the yzj stock, i managed to analyze and find trading ideas and opportunities that may present in coming days or weeks. Look at the horizontal lines, they represent lines of strong support which you should look out for strong buying if it present itself. (Only one line, which is the top line high above, it represents resistance.) These lines are also known as the Market Memory where price were previously held by big operators. When the market is falling and when those lines were reached, one should look out for evidence of operators activities. If the operators feel that prices are attractive at one of those lines, he would pronounced himself by his activity, else the bricks will continue to fall and support will continue to be breached.
Looking at the whole operation from late September - early October 2010, big operators managed to accumulate his inventory and by mid October, he managed to clear most of holdings so as to cash in profits and start purchasing for one final push. There is one area that i would like to touch on most. See the picture on the area where i wrote "Accumulation with weak rally effort". This is a very IMPORTANT point. During that elongated 20 days worth of accumulation and absorption of selling, it tells me that the operators are going to bring prices up very high because it will not be worth for their effort and time to accumulate for 20 days and just bring prices slightly above it's previous high and start short selling. This is a major indication of bad omen for any stock. And so true enough, on 13/1/2011, the sporadic action of yzj capered and pronounced itself, where operators were unloading and the public thought it was a breakout for buying more. The rest was history, the public got slaughtered for their ignorance.
For my trading plan in the coming days or weeks, i am looking for operators to cover shorts and cash in some profits before releasing more shorts. I will look to short once the short covering is over or until i see signs of strong buying which tells me to buy with the operators.
Ronald K
