NVTC Newsletter071207

NextVIEW Traders Club Weekly Newsletter
Published by NextView Sdn. Bhd. (574271-D) Ph +6 03 27139388 Fax +6 03 27139366

Add B-9-12, Block B, Level 9, Megan Avenue II, 12 Jalan Yap Kwan Seng, 50450 Kuala Lumpur, Malaysia
Newsletter for the week ending 07 December 2007
THIS WEEK’S CONTENTS:

Page
1. Investment/Trading Related Articles:

Focus on the Right Things …… 2
by Stuart McPhee, , private trader, author and trading coach
2. Market Commentaries
i) Bursa Malaysia Kuala Lumpur Composite Index (KLCI) …….. 4
Additional KLCI analysis by Benny Lee …….. 5
ii) Singapore Straits Times Index (STI) …….. 6
Additional STI analysis by Benny Lee …….. 7
iii) Thailand SET Index (SETI) …….. 8
Additional SETI analysis by Benny Lee …….. 9
iv) Hong Kong Hang Seng Index (HSI) …….. 10
Additional HSI analysis by Benny Lee …….. 11
v) Dow Jones Industrial Average (DJI) …….. 12
Additional DJI analysis by Benny Lee …….. 13
3. Regional Market Forecast Group (N/A) …….. 14
4. Regional Traders Education Events …….. 15
Disclaimer and Copyright …….. 17
© 2006 - 2007 NextView Investors Education Group. All rights reserved. 1

1. Trading/Investment Related Articles:
Focus on the Right Things
By Stuart McPhee, private trader, author and trading coach
Today, computers and trading software make it so easy to access information from almost anywhere.
Never before have so many people had useful tools readily available to them at their fingertips.
I believe this situation presents a problem for a lot of people, in that they try to overcomplicate matters
that don’t need overcomplicating. With the features of some charting software, people will try and write
formulas to identify the most bizarre and complex things.
I once had a client present his entry signal to me which I estimated took 10-15 minutes to do so. After
two minutes of listening, I am already starting to shake my head inside. It included things like, “well, I
wait for that indicator to cross that one and then … “ and “now if that indicator is still below 50 for the next
3 days and that indicator doesn’t cross above that one
… “ and how about “must cross over that blue line at an angle of more than 45 degrees … “ and the
explanation goes on and on.
I believe that people have a tendency to complicate matters where in most instances a simple solution
will be more than adequate - our entry signal when trading is no exception. As mentioned, some
examples I have heard involve numerous indicators crossing each other at various angles and changing
colours and all sorts of trivial conditions. In these cases, if I was to take their notes away from them, they
wouldn’t be able repeat 20% of their entry signal. This is a concern.
Generally, two big problems that traders face are not having a trading plan and if they do have one, not
following it. There is no need to complicate things beyond simple comprehension. One thing I have
learned about trading plans, is that the easier it is to understand, the more likely you are to follow it.
People have been trading various types of markets for hundreds of years – and making money doing it.
It wasn’t too long ago that a computer was not common place in every home as we find it today.
Computers were once restricted to people wearing white lab coats and they filled up entire rooms
accompanied by the deafening noise of cooling fans whirring away. In these days, hand drawn charts
with few if any technical indicators were used. Yet, despite this, people still made money trading. They
followed the rules that have stood the test of time.
So, if people at the beginning of the 20th century were profiting from speculation in a market, yet they
didn’t have access to a PC, charting software, various technical indicators and customized lines covering
a chart, clearly having these tools is not an absolute must, nor even necessary. No doubt, they are
useful tools today and many people enjoy the benefits of them but they are not the most important
ingredient to your success – they are not even close.
I believe a lot of people think that the more time they can spend developing and refining their entry signal,
the better off they will be – sometimes to the detriment of more important areas.

How do we fix this? The important point to be made here is to focus. Focus on the right things and the
things in your trading plan that are important. As an example, several years ago, a colleague and I were
running a full day course where we both presented on different topics throughout the day and the
attendees could decide which presentations they attended. As the day started, the group split
themselves quite evenly to listen to the two separate presentations. This even split continued throughout
the morning as people moved between the two seminar rooms between breaks and maintained a fairly
even split.
After lunch, the first two presentations were on industry sector analysis and money management. The
group split themselves up again however this time, 80% of the people went into the seminar room for the
presentation on industry sector analysis and the remaining 20% entered my seminar room for my
presentation on money management. Before I started my presentation, I said to my attendees that this is
another reason why most traders fail. 80% of the group thought that industry sector analysis was more
important than money management and therefore decided to listen to that presentation. There are not
too many more important things than money management and industry sector analysis, which was
designed to help them with their entries, is certainly not one of them.
The lesson here is to focus on the right things. Don’t focus too much on your entry signal, as most people
do. Keep it simple and move onto the more important areas like position sizing, setting exits and
preparing your mind for successful, disciplined trading.
About the Author:
Stuart McPhee is a private trader, author and trading coach. He has written numerous articles and texts
including Trading in a Nutshell, 2nd Edition. He also conducts trading courses throughout South East
Asia and has presented at trading expos in Singapore, Kuala Lumpur, Ho Chi Minh City, and Shenzhen.
Visit Stuart’s ‘Develop your Trading Plan’ website (www.trading-plan.com) for detailed information on
how to develop a trading plan that is right for you and that you will implement with confidence. Also
available is a regular ezine full of useful trading tips and ideas.

2. Market Commentaries
i) Bursa Malaysia Kuala Lumpur Composite Index (KLCI)
Technical Analysis as of 07/12/2007
Basic Price information

Close: 1,434.04
Trend Analysis
MACD (12.9463)
MACD is indicating that the current short term price trend is very bullish. The momentum of the trend is
strong.
Moving Averages 10-day(1,400.4590), 30-day(1,392.4584), 60-day(1,367.8849), 100-day(1,342.5544).

SHORT-Term Trend: Very bullish
LONG-Term Trend: Very bullish

Support and Resistance Analysis
Immediate Support: 1,338.1400
Longer term Support: 1,325.1400
Immediate Resistance: 1,449.7000
Longer term Resistance: 1,449.7000
100 day SMA Support: 1,342.5544

Stochastic(91.8956) is currently overbought and is getting lower.
Price Reversals
Candesticks
Bullish Candlestick pattern: No bullish candlestick pattern detected in the last 3 days.
Bearish Candlestick pattern: Engulfing Bear is detected today
Bar Chart Patterns

Bar Chart Bullish Price Reversal Pattern: No bar chart bullish price reversal detected for the last 3 days
Bar Chart Bearish Price Reversal Pattern : No bar chart bearish price reversal detected for the last 3 days
Stochastic
Stochastic Bullish Price Reversal : No bullish reversal in the last 2 days.
Stochastic Bearish Price Reversal : Stochastic crossed below its %D today.
Volatility Analysis
Short term volatility: The 3-period ATR (17.6794) has increased therefore price action is more volatile
Longer Term volatility: The Bollinger Bands are expanding therefore price action is more volatile
Volume Analysis
Volume: 57,000 shares, 30-day average volume: 63,000 shares.
Volume strength is moderate. The On Balance Volume is increasing, indicating accumulation of shares in the
market.
________________________________________________________
Additional KLCI analysis by Benny Lee, Chief Market Strategist, NextView
Pullback expected
The KLCI broke the 1,410 resistance last week and almost tested the next resistance level at 1,450
points on Friday. However, it closed at 1.434.04 points last Friday, a 38 points increase from the
previous Friday’s close. Now that the KLCI has drifted higher above the short term 30-day moving
average, a pull back is expected at least to the short term average of 1,400 points especially if a
bearish reversal pattern formed on Friday called the Engulfing Bear. The 1,450 points level remains
as its main resistance while the support level is at 1,400 points level.

ii) Singapore Straits Times Index (STI)

Close: 3,557.95
Trend Analysis
MACD (-20.8325)
MACD is indicating that the current short term price trend is bullish. The momentum of the trend is strong.
Moving Averages 10-day(3,488.0410), 30-day(3,549.5581), 60-day(3,631.8191), 100-day(3,547.5779).

SHORT-Term Trend: Bullish


Price Reversals
Candesticks
Bearish Candlestick pattern: No bearish candlestick pattern detected in the last 3 days.
Bar Chart Patterns

Bar Chart Bearish Price Reversal Pattern : Key Reversal DOWN was detected yesterday
Stochastic
Stochastic Bearish Price Reversal : No bearish reversal in the last 2 days.
Volatility Analysis
Longer Term volatility: The Bollinger Bands are contracting therefore price action is less volatile
Volume Analysis
Volume: 222,000 shares, 30-day average volume: 239,167 shares.
market.
________________________________________________________
Additional STI analysis by Benny Lee, Chief Market Strategist, NextView
Strong resistance on STI
In the last 2 days of last week the STI opened high, but failed to maintain its bullishness and closed
near the low. This shows that strong resistance were present in that 2 days as traders took every
opportunity to sell when prices go higher. The STI closed at 3557.95 points, only up about 35 points
from the previous corresponding Friday’s close. The week’s high was 3,621.84. The STI is still
somewhere in the middle of the major 3,300 and 3,700 support and resistance level. The upward
momentum has slightly improved, but still not strong enough to spur a market rally. Therefore, the
STI is expected to remain sideways, with an upward bias.

iii) Thailand SET Index

Close: 841.3900
Trend Analysis
MACD (-7.1075)
MACD is indicating that the current short term price trend is bullish. The momentum of the trend is strong.
Moving Averages 10-day(833.2810), 30-day(856.8140), 60-day(854.6672), 100-day(839.3244).

SHORT-Term Trend: Very bearish
LONG-Term Trend: Bullish

Immediate Support: 796.9400
Longer term Support: 796.9400
Immediate Resistance: 855.5800
Longer term Resistance: 924.7000

100 day SMA Support: 839.3244
200 day SMA Support: 781.2698
Stochastic(71.3772) is currently slightly overbought and is getting higher.
Price Reversals
Candesticks
Bar Chart Patterns

Stochastic
Volatility Analysis
Longer Term volatility: The Bollinger Bands are contracting therefore price action is less volatile
Volume Analysis
Volume: 141,292,000 shares, 30-day average volume: 186,563,136 shares.
market.
________________________________________________________
Additional SETI analysis by Benny Lee, Chief Market Strategist, NextView
More uncertainty
The SETI has shown very uncertain moves last week by trading in a 32 points range of between
823.94 and 855.58. It closed at 841.39 last Friday. The SETI is currently in the short to long term 30
to 90 days moving average range and therefore the trend is sideways. The momentum indicators are
showing small signs of upward momentum increasing. Support and resistance levels are at 796 and
860 points respectively. While the Thailand market is expected to remain uncertain, the SETI has a
little upward bias because of the increasing upward momentum.

iv) Hong Kong Hang Seng Index (HSI)

Close: 28,842.47
Trend Analysis
MACD (135.0039)
however, weak.
Moving Averages 10-day(28,461.9063), 30-day(28,739.5762), 60-day(28,117.0879), 100-

day(25,993.0273).



Price Reversals
Candesticks
Bar Chart Patterns

Bar Chart Bearish Price Reversal Pattern : Island Reversal DOWN was detected yesterday
Stochastic
Stochastic Bearish Price Reversal : Stochastic crossed below its %D today.
Volatility Analysis
Volume Analysis
Volume: 2,147,483,904 shares, 30-day average volume: 2,576,930,816 shares.
market.
________________________________________________________________________________________
Additional HSI analysis by Benny Lee, Chief Market Strategist, NextView
HSI set for short term downward reversal
Friday’s pullback of 716.45 points marred 4 days of upward movement on the HSI. This makes the
HSI performance uncertain last week with a trading range of 28,544 and 29,963 points and the HSI
closed nearer to the week’s low at 28842.47 points. The HSI is set for a downward reversal this
week because of the dismay performance last week although there are signs of slight improvement
on the upward momentum. It should test to close the gap on the 29th November to 27,650 points.
The major support and resistance level still stands t 25,800 and 30,000 respectively.

v) Dow Jones Industrial Average (DJI)

Close: 13,625.58
Trend Analysis
MACD (1.2685)
strong.
Moving Averages 10-day(13,292.8516), 30-day(13,328.8438), 60-day(13,585.9521), 100-

day(13,491.2490).


Stochastic(97.0120) is currently overbought and is getting higher.
Price Reversals
Candesticks
Bar Chart Patterns

Stochastic
Volatility Analysis
Short term volatility: The ATR has declined therefore price action is less volatile
Volume Analysis
Volume: 179,419,008 shares, 30-day average volume: 267,155,344 shares.
market.
________________________________________________________________________________________
Additional DJI analysis by Benny Lee, Chief Market Strategist, NextView
Pullback expected for DJI
After a weak start last week, the US DJI has made quite a good 2 days rally upwards to close above
the short to long term 30 to 90 days average. However, the rally was not extended on Friday. The
DJI closed at 13,625.58 last Friday climbing 146.7 points from the previous corresponding Friday’s
close. Despite showing stronger upward momentum, a pullback on the short term trend is expected
because of an uncertainty sentiment shown on Friday and that the DJI is now at the top band of the
Bollinger Bands. The DJI is expected to pullback to at least at the 13,400 points level. Major support
and resistance levels are at 13,000 and 14,000 respectively.

3. Regional Market Forecast Group
Not Available This Week

4. Regional Traders Education Events this week
SINGAPORE

HONG KONG

________________________________________________________________________________________
DISCLAIMER AND COPYRIGHT NextView Sdn. Bhd. (574271-D) and NextView Traders Club (NVTC) are NOT a licensed
investment advisors. This publication, which is generally available to members of NVTC, falls under Media Advice provisions. These
analysis notes are based on our experience of applying technical analysis to the market and are designed to be used as a tutorial showing
how technical analysis can be applied to a chart example based on recent trading data. This newsletter is a tool to assist you in your
personal judgment. It is not designed to replace your Licensed Financial Consultant, your Stockbroker. It has been prepared without
regard to any particular person's investment objectives, financial situation and particular needs because readers come from diverse
backgrounds, with diverse objectives and financial situations. This information is of a general nature only so you should seek advice from
your broker or other investment advisors as appropriate before taking any action. The decision to trade and the method of trading is for
the reader alone to decide. The author, contributors and publisher expressly disclaim all and any liability to any person, whether the
purchase of this publication or not, in respect of anything and of the consequences of any thing done or omitted to be done by any such
person in reliance, whether whole or partial, upon the whole or any part of the contents of this publication. Neither NextView Sdn Bhd
(including offices in other countries) nor its officers, employees and agents, will be liable for any loss or damage incurred by any person
directly or indirectly as a result of reliance on the information contained in this publication. The information contained in this newsletter is
copyright and for the sole use of NVTC Members. It cannot be circulated to other readers without the permission of the publisher. This is
not a newsletter of stock tips. Case study trades are notional and analyzed in real time on a weekly basis. NextView Sdn Bhd does not
receive any commission or benefit from the trading activities undertaken by readers, or any benefit or fee from any of the stocks reviewed
in the newsletter. NextView Sdn Bhd is an independent financial education organization and research is supported by NVTC annual
membership fees.
OFFICES;
Head Office Malaysia: B-9-12, Block B, Level 9 Megan Avenue II, 12 Jalan Yap Kwan Seng, 50450 Kuala Lumpur, Malaysia. Singapore: 5 Shenton Way,
#02-03/05 UIC Building, Singapore 068808. Thailand: The Millennia Tower, 18th Floor, Unit 1806, 62 Langsuan Road, Lumphini, Pathumwan Bangkok,
10330, Thailand. Hong Kong: Room B, 16/F, Crawford Tower, 99 Jervois Street, Sheung Wan, Hong Kong. China: 98 Liuhe Road, 16A GangLu
HuangPu Center Building, Shanghai 200001

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NextVIEW Traders Club Weekly Newsletter

Published by NextView Sdn. Bhd. (574271-D) Ph +6 03 27139388 Fax +6 03 27139366

Newsletter for the week ending 07 December 2007

THIS WEEK’S CONTENTS:

1. Investment/Trading Related Articles:

3. Regional Market Forecast Group (N/A) …….. 14

4. Regional Traders Education Events …….. 15

Disclaimer and Copyright …….. 17

© 2006 - 2007 NextView Investors Education Group. All rights reserved. 1

© 2006 - 2007 NextView Investors Education Group. All rights reserved. 2

About the Author:

© 2006 - 2007 NextView Investors Education Group. All rights reserved. 3

Basic Price information

Moving Averages 10-day(1,400.4590), 30-day(1,392.4584), 60-day(1,367.8849), 100-day(1,342.5544).

© 2006 - 2007 NextView Investors Education Group. All rights reserved. 4

100 day SMA Support: 1,342.5544

Stochastic(91.8956) is currently overbought and is getting lower.

Bar Chart Patterns

Additional KLCI analysis by Benny Lee, Chief Market Strategist, NextView

© 2006 - 2007 NextView Investors Education Group. All rights reserved. 5

Basic Price information

Moving Averages 10-day(3,488.0410), 30-day(3,549.5581), 60-day(3,631.8191), 100-day(3,547.5779).

Support and Resistance Analysis

© 2006 - 2007 NextView Investors Education Group. All rights reserved. 6

Stochastic(84.5029) is currently overbought and is getting lower.

Bar Chart Patterns

Additional STI analysis by Benny Lee, Chief Market Strategist, NextView

Strong resistance on STI

© 2006 - 2007 NextView Investors Education Group. All rights reserved. 7

Basic Price information

Moving Averages 10-day(833.2810), 30-day(856.8140), 60-day(854.6672), 100-day(839.3244).

Support and Resistance Analysis

© 2006 - 2007 NextView Investors Education Group. All rights reserved. 8

Stochastic(71.3772) is currently slightly overbought and is getting higher.

Bar Chart Patterns

© 2006 - 2007 NextView Investors Education Group. All rights reserved. 9

Basic Price information

Moving Averages 10-day(28,461.9063), 30-day(28,739.5762), 60-day(28,117.0879), 100-

Support and Resistance Analysis

© 2006 - 2007 NextView Investors Education Group. All rights reserved. 10

100 day SMA Support: 25,993.0273

Stochastic(87.0117) is currently overbought and is getting lower.

Bar Chart Patterns

Additional HSI analysis by Benny Lee, Chief Market Strategist, NextView

HSI set for short term downward reversal

© 2006 - 2007 NextView Investors Education Group. All rights reserved. 11

Basic Price information

Moving Averages 10-day(13,292.8516), 30-day(13,328.8438), 60-day(13,585.9521), 100-

© 2006 - 2007 NextView Investors Education Group. All rights reserved. 12

100 day SMA Support: 13,491.2490

Stochastic(97.0120) is currently overbought and is getting higher.

Bar Chart Patterns

Additional DJI analysis by Benny Lee, Chief Market Strategist, NextView

Pullback expected for DJI

© 2006 - 2007 NextView Investors Education Group. All rights reserved. 13

© 2006 - 2007 NextView Investors Education Group. All rights reserved. 14

© 2006 - 2007 NextView Investors Education Group. All rights reserved. 15

© 2006 - 2007 NextView Investors Education Group. All rights reserved. 16

© 2006 - 2007 NextView Investors Education Group. All rights reserved. 17

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