NVTC Newsletter070803

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 3 August 2007
THIS WEEK’S CONTENTS:

Page
1. Investment/Trading Related Articles:

Do Daily Forecasts Aid your Trading? …… 2
by Bryce Gilmore & Associates Pty Ltd
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 Don Schellenberg …….. 9
iv) Hong Kong Hang Seng Index (HSI) …….. 12

Additional HSI analysis by Benny Lee …….. 13
v) Dow Jones Industrial Average (DJI) …….. 14

Additional DJI analysis by Benny Lee …….. 15
3. Regional Market Forecast Group …….. 16
4. Regional Traders Education Events …….. 17
Disclaimer and Copyright …….. 22
© 2006 - 2007 NextView Investors Education Group. All rights reserved. 1

1. Trading/Investment Related Articles:
Do Daily Forecasts Aid your Trading?
By Bryce Gilmore & Associates Pty Ltd
Personally, I don’t think so. I think forecasts place a noose around your neck and keep
you from simply trading what you see happening at the time when it happens. In fact, I
believe that, if you are trading short-term intraday, a forecast means nothing to you, and
the more times you see a forecast, the worse off you will be.
Each day is a new day, and, unless the market is enveloped in a major fundamental bias, it will not
head in one direction or the other for the entire day. What the market will do most days is move in
the direction of least resistance as it tests the strengths and weaknesses of the forecasters.
But, as we enter each new day, we can certainly have prepared guidelines to follow. These will fall
under certain technical categories that we always know will influence the actions of the “smart
money” in the marketplace.
If the prior day has left the TREND-following players with a positive direction to follow, and nothing
has been revealed overnight that changes that opinion, the TREND followers will start off the day
trading in that direction. They really have no choice.
If the current TREND is approaching critical geometric support or resistance levels, you can be sure
the “smart money” will know where they are. The “smart money” will be watching for OVERBOUGHT
or OVERSOLD indicator readings when the market price approaches any of these levels.
As traders, we need to evaluate the importance of the levels the “smart money” will focus on as the
day progresses. Professional traders develop habits they stick to because they know that is the best
approach to staying flexible.
Many start off the day with the basics, such as the knowledge of where the previous and nearest
swing pivot levels are located and also the levels the Floor Traders (FTPs) publish each day as PIVOT
POINT, S1, S2, R1, R2. Pros use the FTPs as a guide to market strength or weakness.
Prior SWING levels are important technically because they define past levels of implied support or
resistance. During the course of a new trading day, the market will gravitate up and down, testing
prior levels of support and resistance, as well as the FTPs.
As it does this, the market will attract buyers and sellers prepared to take profits and / or establish
new positions in the opposite direction. If these implied support or resistance levels fail to hold the
market, this occurrence will work its way down or up to the next obvious levels the “smart money”
will have on their minds.
Potential support and resistance levels come in various forms as geometric levels derived from
recent market activity. Traders work these levels out in relationship to the daily, 60-minute, 15-
minute and right down to the 1-minute charts available to them.
Here’s an example for the opening of Tuesday, June 27, 2006:

These levels are derived from the ES 20-minute chart activity during the 4 days prior to June 27.
They should be sufficient for the next trading session, assuming there is no major breakout above
R2 or below S2.
R2 is at 1266.25 and S2 is at 1250.25, which leaves us with a possible 16-point range to deal with.
Each day should be approached in the same way, and, then, you just let the market declare its own
hand. Once the trading day begins, you can start to work it from a much closer perspective.

2. Market Commentaries
i) Bursa Malaysia Kuala Lumpur Composite Index (KLCI)
Technical Analysis as of 3/8/2007
Basic Price information

Close: 1,335.42
Trend Analysis
MACD (-5.7204)
MACD is indicating that the current short term price trend is very bearish. The momentum of the trend is
strong.
Moving Averages 10-day(1,362.4630), 30-day(1,367.8733), 60-day(1,363.6395), 100-day(1,331.6753).

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

Support and Resistance Analysis
Immediate Support: 1,323.7600
Longer term Support: 1,323.7600
Immediate Resistance: 1,392.1801
Longer term Resistance: 1,392.1801
100 day SMA Support: 1,331.6753

Stochastic(16.3728) is currently oversold and is getting lower.
Price Reversals
Candesticks
Bullish Candlestick pattern: No bullish candlestick pattern detected in the last 3 days.
Bearish Candlestick pattern: No bearish candlestick pattern detected in the last 3 days.
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 : No bearish reversal in the last 2 days.
Volatility Analysis
Short term volatility: The ATR has declined therefore price action is less volatile
Longer Term volatility: The Bollinger Bands are expanding therefore price action is more volatile
Volume Analysis
Volume: 86,000 shares, 30-day average volume: 78,233 shares.
Volume strength is moderate. The On Balance Volume is declining, indicating distribution of shares in the
market.
________________________________________________________
Additional KLCI analysis by Benny Lee, Chief Market Strategist, NextView
Further downside expected
The KLCI failed to be supported at the 1338 level. The lowest low of the week was 1323.76. Looks
like the KLCI and other markets are geared for a major correction. New lows are expected to be
tested this week and investors, especially those bought at higher prices had uneasy weekend
because the Dow Jones Industrial Average fell 281 points (2.09%)
The KLCI trend has started to be bearish and its strength is developing as the ADX indicator is rising.
The KLCI is expected to test at least the psychological level of 1300. The 38.2% Fibonacci
retracement from the upward rally since early March to the peak in end June is at 1285. Therefore,
the last line of defense for the up trend correction or crucial support should be seen at 1285 to 1300.

ii) Singapore Straits Times Index (STI)

Close: 3,436.04
Trend Analysis
MACD (-28.3903)
strong.
Moving Averages 10-day(3,538.3611), 30-day(3,571.1543), 60-day(3,558.8423), 100-day(3,462.2915).


100 day SMA Resistance: 3,462.2915

Price Reversals
Candesticks
Bar Chart Patterns

Stochastic
Volatility Analysis
Volume Analysis
Volume: 266,000 shares, 30-day average volume: 304,300 shares.
Volume strength is moderate. The On Balance Volume is increasing, indicating accumulation of shares in the
market.
________________________________________________________
Additional STI analysis by Benny Lee, Chief Market Strategist, NextView
STI down trend getting stronger
The STI went below the support level of 3480 and went to a low of 3399 last week (a 38.2%
Fibonacci retracement from the up trend rally since early March till end June. Like I have mentioned
last week, that if 3480 support level is broken, the next support level is at 3300, which very close to
the 50% retracement level. STI is expected to test this level and probably go even lower, looking at
circumstances in the US market.
The STI trend is now downwards and the short term down trend is getting stronger, as the ADX
indicator has started to increase. The long term trend has also been affected by the strong
downward momentum. We may be looking at a major correction in the STI taking place now.

iii) Thailand SET Index

Close: 837.73
Trend Analysis
MACD (13.2529)
MACD is indicating that the current short term price trend is bearish. The momentum of the trend is strong.
Moving Averages 10-day(858.6750), 30-day(832.2030), 60-day(785.7936), 100-day(745.6719).

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

Immediate Support: 820.0300

Longer term Support: 716.3800
Immediate Resistance: 895.6300
Longer term Resistance: 895.6300
100 day SMA Support: 745.6719

200 day SMA Support: 721.3630
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: 317,758,016 shares, 30-day average volume: 463,997,216 shares.
market.
________________________________________________________
Additional Thailand SETI and Stocks analysis by Don Schellenberg, Senior Market
Strategist, NextView
Analysis of SETI
On July 26th Thailand’s Stock Index reached a high of 895.63, very near my first major target of 900,
around which a correction was expected.
So far the drop has been quite steep. However, fairly strong support is nearby in a zone between
810-800..
We can see on the chart that the index broke down through a steep Trend Line (TL#1). That was
expected because the rise in value was becoming parabolic – rising too far too fast.
The next important supporting Trend Line (TL#2) is currently around 780.

Soon an upward move should begin but will not likely reach 900 until there has been another
downward correction. By that time TL#2 on the chart should rise to near 800 and will help provide
support to the Index.
TECHNICALS:
TL#1 – the rising Trend Line recently broken to the downside.

TL#2 – should provide some support to the Index in the near future.
R1- nearby resistance
S1- nearby support area.
MACD – was very overbought. It is now declining but is still in positive territory.
Ichimoku Kinko Hyo – the cloud helps to show where support is in this market. The arrow points to
the cloud.
Analysis of KTB
Some price patterns that are commonly seen on charts are extremely reliable in predicting the next
movements in price. KTB.th is a good example of this fact.
On July 20/07 I analyzed the KTB price chart in this column. I wrote as follows: “I’m showing you
this chart because it’s an excellent example of what I call and ABC pattern on the chart. This
commentary may also help some investors who don’t want to hold on to this stock while it drops

another 10-15%.” “….Based on this ABC pattern it is highly probably that this stock will drop down
to test the December 19th low at 10, and perhaps even a little lower over the next few weeks.
I also wrote “…this stock could also rally somewhat as in a ‘bearish market rally’ but I expect that
price for this stock will reach 10 before it reaches 14.”
So far this is exactly what happened. On July 20th, the day of my commentary, this stock price was
rising when I forecast that it would go down – and it continued rising for three more days before
collapsing down to around 11 at this time.
May I suggest that it is extremely useful for traders and investors to learn some of the common
reliable signals that can be seen on charts.
Although there may be another small rally soon, the main direction is still down, with the first
downside price target being 10.60. Later a lower target is still a genuine possibility.
TECHNICALS:
Price pattern – the price pattern itself is the main reason for my downside forecast. It is still in
effect.
Li’s Sandwich – suggests some support will be found around 10.50.
NextView RSI- On July 20th the RSI was in a positive zone – but is now very clearly down.
Arrow on chart – points to July 20th/07

iv) Hong Kong Hang Seng Index (HSI)

Close: 22,538.44
Trend Analysis
MACD (179.6221)
MACD is indicating that the current short term price trend is bearish. The momentum of the trend is strong.
Moving Averages 10-day(22,934.4609), 30-day(22,630.7070), 60-day(21,732.0527), 100-

day(21,053.6406).
SHORT-Term Trend: Very bullish
LONG-Term Trend: Very bullish


Stochastic(22.4678) is currently slightly oversold and is getting lower.
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: 1,787,588,992 shares, 30-day average volume: 2,083,450,880 shares.
market.
________________________________________________________________________________________
Additional HSI analysis by Benny Lee, Chief Market Strategist, NextView
HSI set to retest its previous resistance of 21,000
The short term 30-day moving average support level has finally been broken. The long term 90 day
moving average support level is around 21,260, while the strong support level (which was once the
strong resistance level is at 21,000). With trend being bearish and a heavy fall in the US market, the
HSI is expected to correct downwards further at least to these support ranged of between 21,000 to
21300. Expect the Hong market to be very volatile this week, especially in the beginning of the week.

v) Dow Jones Industrial Average (DJI)

Close: 13,181.91
Trend Analysis
MACD (-69.5478)
strong.
Moving Averages 10-day(13,476.2393), 30-day(13,584.0996), 60-day(13,539.6611), 100-

day(13,195.0498).

100 day SMA Resistance: 13,195.0498

Stochastic(22.8517) is currently slightly oversold and is getting higher.
Price Reversals
Candesticks
Bullish Candlestick pattern: Engulfing Bull was detected 2 days ago
Bar Chart Patterns

Bar Chart Bullish Price Reversal Pattern: Key Reversal UP was detected 2 days ago
Stochastic
Stochastic Bullish Price Reversal : Stochastic crossed above its %D yesterday.
Volatility Analysis
Short term volatility: The 3-period ATR (246.6738) has increased therefore price action is more volatile
Volume Analysis
Volume: 301,804,992 shares, 30-day average volume: 264,097,472 shares.
market.
________________________________________________________________________________________
Additional DJI analysis by Benny Lee, Chief Market Strategist, NextView
More downside for DJI
The US market has been volatile last week and attempted to bounce back upwards after taking a
severe beating downwards failed as the DJI fell sharply on Friday once again. The trend has started
to turn bearish. The ADX is increasing, indicating that the down trend is getting stronger. The DJI is
expected to test the next support level at 13,000 and may even go lower to test the stronger
support level at 12750.

2. Regional Market Forecast Group
AVERAGE FORECAST SUMMARY as at 3 AUGUST 2007
KLCI STI HSI SETI
TODAY'S CLOSE 1335.42 3436.04 22538.44 837.73
A Forecast (Direction) D S D D
Forecasted Weekly Trading Range
B Support (Low) 1295.0 3302.5 21500.0 800.0
C Resistance (High) 1361.3 3536.3 22965.0 860.0
A FORECAST DIRECTION
Benny Don Richard Li Xin Jing Steve AVG
1 KLCI D S D D D
2 STI D S S D S
3 HSI D S S D D
4 SETI D S D D D
B FORECAST RANGE (SUPPORT / WEEK LOW)

1 KLCI 1290.0 1300.0 1290.0 1300.0 1295.0
2 STI 3300.0 3360.0 3300.0 3250.0 3302.5
3 HSI 21500.0 21500.0 22290.0 21200.0 21500.0
4 SETI 800.0 790.0 810.0 800.0 800.0
C FORECAST RANGE (RESISTANCE / WEEK HIGH)

1 KLCI 1340.0 1380.0 1375.0 1350.0 1361.3
2 STI 3470.0 3625.0 3600.0 3450.0 3536.3
3 HSI 22600.0 23260.0 23200.0 22800.0 22965.0
4 SETI 845.0 875.0 870.0 850.0 860.0
Note:
Forecast Direction
S = Sideway
U = Up
D = Down
Sideway market is considered if the index falls between 0.4% of the index close on Friday
Sideway Range Calculation Close Sideway Range
KLCI 1335.4 1330.1 to 1340.8
STI 3436.0 3422.3 to 3449.8
HSI 22538.4 22448.3 to 22628.6
SETI 837.7 834.4 to 841.1
Direction is based on next Fridays close. If next Friday's close is above the sideway range, direction is considered up and vice versa for
price below sideway range

4. Regional Traders Education Events this week
MALAYSIA

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,
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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 3 August 2007

THIS WEEK’S CONTENTS:

1. Investment/Trading Related Articles:

iv) Hong Kong Hang Seng Index (HSI) …….. 12

v) Dow Jones Industrial Average (DJI) …….. 14

3. Regional Market Forecast Group …….. 16

4. Regional Traders Education Events …….. 17

Disclaimer and Copyright …….. 22

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

Here’s an example for the opening of Tuesday, June 27, 2006:

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

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

Basic Price information

Moving Averages 10-day(1,362.4630), 30-day(1,367.8733), 60-day(1,363.6395), 100-day(1,331.6753).

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

100 day SMA Support: 1,331.6753

Stochastic(16.3728) is currently oversold and is getting lower.

Bar Chart Patterns

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

Further downside expected

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

Basic Price information

Moving Averages 10-day(3,538.3611), 30-day(3,571.1543), 60-day(3,558.8423), 100-day(3,462.2915).

Support and Resistance Analysis

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

100 day SMA Resistance: 3,462.2915

Stochastic(12.0558) is currently oversold and is getting lower.

Bar Chart Patterns

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

STI down trend getting stronger

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

Basic Price information

Moving Averages 10-day(858.6750), 30-day(832.2030), 60-day(785.7936), 100-day(745.6719).

Support and Resistance Analysis

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

100 day SMA Support: 745.6719

Stochastic(13.3806) is currently oversold and is getting lower.

Bar Chart Patterns

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

TL#1 – the rising Trend Line recently broken to the downside.

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

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

Basic Price information

Moving Averages 10-day(22,934.4609), 30-day(22,630.7070), 60-day(21,732.0527), 100-

Support and Resistance Analysis

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

100 day SMA Support: 21,053.6406

Stochastic(22.4678) is currently slightly oversold and is getting lower.

Bar Chart Patterns

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

HSI set to retest its previous resistance of 21,000

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

Basic Price information

Moving Averages 10-day(13,476.2393), 30-day(13,584.0996), 60-day(13,539.6611), 100-

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

100 day SMA Resistance: 13,195.0498

Stochastic(22.8517) is currently slightly oversold and is getting higher.

Bar Chart Patterns

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

More downside for DJI