Choppy flight

Good morning,

I have been receiving a well respected analyst group’s research paper every morning that predicts the Hong Kong index prices using purely technical chartings and out of curiosity I kept a record of their performance. I am glad that I did not follow the recommendations as the accuracy of its predictions is less than 20% for the last 6 months. Trading stock is like flying a plane. The pilot navigates the plane from take off to landing using information from data instruments in the cockpit. As long as the instruments are calibrated correctly and the pilots are well trained to understand the information and use them to fly, the plane will be flown smoothly. At times there will be unexpected turbulence but the plane will overcome such obstacles. If the pilots ignore the instrument readings and fly based on his emotions and past experience, likely the flight will be rough or the plane may even crash. In stock trading, having the methods the collect information and understanding these vital information is important to make winning trades consistently. Along the road of trading, calibrations are required to fine-tune these processes of information gathering and interpreting. Sometime we can face headwinds, turbulence and bumpy situations, but as long as the information is right and well-timed, the trading path will be smooth. Before a pilot can fly, he has to attend and finish a rigorous training program, including flying a flight simulator. So is a new stock trader. He should be attending a good course in finance and trading methods and use his understandings to trade a simulated demo account. Just as a pilot needs to prepare thoroughly before his flight, a stock trader should also do his homework and prepares as much before trading the markets.

US markets started the week as forecasted by KUTE yesterday, with DJIA ending the session with only a 0.01% gain after a choppy trading session. With the lack of market moving headlines, the day’s trading direction is largely determined by Bernanke’s comments and US dollars. Market breath was mixed with both the bulls and bears roughly even.

For the stocks selected by KUTE for the week, NE gained 1.8% to close at $40.67, ICUI advanced 0.34% to close at $35.14, HP was up 1.03% to close at $37.18 and DOX closed $28.29, up 0.25%.

My market order for DOX of $28.20 was hit and I am now 1 position long for this stock. My currently 2 position on NOV remains, and this stock lost 0.12% to close at $42.23.

Have a great day ahead!

Francies Cheng
BBus MAppliedFinance