Tuesday, January 09, 2007

Why could'nt I cut losses?? TR: neg $2,850

Hmm, wonder what's wrong with hsi.

In the morning, evryone is rushing to buy call warrants. The price shot up even before hsi opens. But within a few minutes of market opening, it crashed down and never really recovered.

I bought 15 lots at 0.665 and another 15 lots at 0.660 before hsi opens. If I sold off before it opened, i'll have made a good profit. Greed greed greed is the downfall of many, including me. I thought hsi would stand a good chance to recover from yesterday's fall but nope, it fell even another 130 points.

This caught me by surprise. Everywhere in the world, almost all the markets are positive, including those in asia pacific and europe. But just not hsi. Hsi seems to diverge from the rest of the bourses and this is why I'm surprised by this sudden turn of move.

Another thing is my cut loss. I thought i was disciplined, but I think I got a million years more to learn about cutting losses promptly. Haven't I realised that if i cut losses promptly, I wouldn't even incur that hefty 18k losses last year? I wouldn't have incurred a 2k loss today too. One of my heaviest losses in warrants, i must say.

I thought about cutting losses later but waited the whole day, and not find a good opportunity to do so. I decided to keep it overnight. I seldom do this but I think it's quite a good rewards/risk.

1. Dow futures +34 as of now. It's nothing to take note because at most this means dow will open positive. Closing price is more impt.

2. Looking at europe and japan, they all closed +ve. This could be a better indicator of dow tonight to close positive.

3. I am hoping some of the enthusiasm of China life A listing in shanghai would rub onto hsi tmr

4. Hsi closed negative for 2 consecutive days already, knocking down nearly 400 points off roughly. So tmr should be a good probability of a technical rebound. Cannot everyday fall right, not in a bear market yet lah.

I'm also quite pleased to see a surge of pple buying the warrants nearing closing time. It drove the price up by 3 to 4 ticks. Could be anticipating a gap up tmr.

If all that i said didn't come true, esp if dow closed negative and nikkei too,I'll sell before hsi opens. I will have around 1 hour to do so. CUT LOSSES PROMPTLY!

Somehow I'm not very worried about holding this warrant overnight. Dunno why. Had prior experience, almost can't sleep, but not this time.

Longcheer went below support of 1.20 to reach intraday low of 1.18. But bounced back to 1.22. If looking at the closing price, i would say longcheer's day of decline is over. This fits into my analysis of an exhaustion gap before it rises again. Will be doing more analysis tonight. Tmr should be looking at either a slight fall if not a rebound to breach the dynamic support level provided by ema20 days.

Blog more later.

Total returns for the day: negative $2,850