UK Stockmarket 2009 and beyond

tonygee_3

TA is useless with these tiddlers,any news will drive the price significantly either way,in meantime will prob go sideways

tradetime

Hi cloud_dog, generally the textbooks like the volume to expand and drive the flag pole and contract on the flag itself, the idea being that the people who bought on the pole are holding, and potential new volume is waiting for the next breakout to occur.I tend not to worry too much about the volume, as long as there's a bit of an uptick in the flagpole, and the flag itself isn't showing heavy volume.

Looking at that, Kenmare Res ? For me personally, sort of at least it was, looks like there was an attempt to breakout on Jan 26- 28th which failed, it's a very volatile looking stock. Due to what looks like an attempt to breakout and the way this has expanded the flag, I would no longer treat it as a flag. Looks like a reasonable chance it breaks down again from here, market is rallying and it is falling.

tradetime

turbobob wrote: »

Something I heard recently was that short term trading has a lot in common with poker. The best poker players follow a system which they believe gives them an edge but still the cards can be stacked against you. Knowing when to fold is critical. Amateurs on the other hand will keep piling their money in until they lose their shirt.

Buffett's/Benjamin Grahams' idea of "Mr Market" is probably a good one for investors.

There definitely are similarities, they are both in their most basic sense a game of probability, and risk v reward. In trading you can, and I do, follow fairly strict and consistent rules, though would have thought in poker that would make you predictable since you are face to face with your opponent, whereas in the market you are anonymous. Though I do know Doyle Brunson wrote a book called something like "Super System"
Like trading, there will always be losing hands, nothing is ever certain, even pocket aces before the flop are not guaranteed to win.

cloud_dog

tradetime wrote: »

There definitely are similarities, they are both in their most basic sense a game of probability, and risk v reward. In trading you can, and I do, follow fairly strict and consistent rules, though would have thought in poker that would make you predictable since you are face to face with your opponent, whereas in the market you are anonymous. Though I do know Doyle Brunson wrote a book called something like "Super System"
Like trading, there will always be losing hands, nothing is ever certain, even pocket aces before the flop are not guaranteed to win.

TT, many thanks for your thoughts on KMR.

I think both yourself and Turbobob hit on a very important aspect whether it be investing or trading, and that is understanding when to exit (be it in profit or at a loss).

I find people put a lot of effort in to identifying where to invest, how much, balance etc, but do not give enough thought to exit options. In order to actually realise money you need to exist at some point.

tradetime

Hi cloud_dog

Intraday the exit is easy, you have as part of your trading plan, entry points, a stop loss and a target or targets, you simply obey those and trail stops, so you are either stopped out, you scale out at your targets, and if you've left anything on as a runner you exit by the close.

Swing trading is much the same principle, though there is no "end of day" so you simply trial a stop until it gets hit on the final part of your position, or some people trail the stop all the way, and don't scale out, so the stop takes out the entire position at some point.

Investing is not really something I know much about, I don't know how they manage their positions, I think most people just hold forever, or until they get bored, and see something else they want to invest in, and switch to that. I really don't know.

sabretoothtigger

Dont forget dividends for returns, it can be more on average then price growth
Exit strategy will probably count for more this year then last. People could have held the whole of 2009 and done ok but I think January 2010 will be typical of showing its best to sell at the top, buy at the bottom - much more sideways overall but no bigger 'crash' imo


The chart I posted above for SP500 I think shows its broken out of the downward trend since the 1088 trend high did not hold at all.
We have the two strongest days for 3 months recorded which would be typical of a breakout rally and I expect us to stay positive till Friday at least when usa jobs figures come out. (claims thurs)
I guess that could be the catalyst to end the retrace rally but Im not sure

So this trend break is significant imo but the larger time frame has to be respected (and the larger trend failure that occurred) so I think this is just a retrace and just a wave up as the tide continues to retract for a few months



http://www.forexfactory.com/calendar.php?do=geteventinfo&day=2010-2-3&c=2


I dont recognise KMR at all, Tony could be right because if they arent widely traded and the shares are slightly iliquid its harder to guess what they are doing, charts would duplicate that



A company thats done nothing much in the past apparently is harder to judge on its history. High expectations ? Do they have a couple big shareholders, I like it when jpmorgan hold some or whatever


20 year volume price history (they must have done something in that time :laugh:) shows average price to be 15-20. Being above major volume is a positive
2 year chart shows similar, 20 is major support/resistance

Commodities are volatile so I'd expect to see 20 again some time. Resistance at 28. A share in consolidation and needs higher volume, positive news to break out I would guess. Overall looks quite positive

iii wrote:

Kenmare Resources is the Irish, UK-listed owner of the Moma titanium mine in Mozambique. It's had an interesting couple of years developing the mine, during which its share price has fallen from over 30p to less than 10p as it hit execution problems before recovering to the current 25p level.

The Moma mine produces three minerals - rutile, ilmenite, and zircon. Rutile and ilmenite are used as feedstocks to make titanium dioxide (TiO2), for use as a pigment in paper, paint and plastics production. Zircon is relatively higher value, and is used as an opacifier in ceramic production and also in refractory products. Pigments account for 92% of total demand [1] , so this is a fairly economically sensitive industry.

The mining at Moma is done by dredging mineral slurry out of an artificial pond, and then concentrating and separating it. The Moma mine, unusually, was built to a fixed cost, but problems with contractors and with the equipments meant it was late and is still producing slightly below its intended capacity. That led to a collapse in the share price during late 2008 once the problems became apparent - from over 60p down to just 7.5p at the bottom.

Now, the mine has been commissioned and has been producing since July 2009. Already, the company is looking at expansion. And a Deed of Settlement with the contractor has given KMR USD 10m paid over, the right to keep USD 12m retentions, USD 8.5m of waived invoices, and USD 20m delay damages [2] .

The company made a small loss - USD 0.2m - for the first half of 2009, up to the end of June [3] . However, because the mine wasn't up to full production, that's flattered by the fact that many costs of production were capitalised - they have only begun to be reported in the income statement from 1 July 2009.

Production performance has continued to improve since then according to the interim management statement [4] issued in November 2009; third quarter production was up 30% compared to the second quarter in terms of the production of concentrate, and it's at full design levels. However, production of the finished minerals isn't doing so well - ilmenite production was only up 23%, and zircon production was static, though the company is still planning to ramp up to 80% of planned total by year end and to full capacity utilisation in Q1 2010. Latest news [5] is that concentrate production is up to design level, but finished product is still below expectations.

With rather unfortunate timing, Kenmare Resources, an Irish mining company listed on the Alternative Investment Market, has been ramping up production at its Moma titanium minerals mine in northern Mozambique just as the global downturn sent commodities prices into a nose dive. But timing could yet play to Kenmare's favour. The destocking that caused such problems earlier this year is showing signs of coming to an end, with demand expected to pick up from early 2010. On a forward price-earnings ratio at a relatively undemanding 17.3, Kenmare is a buy says the Independent.

Cant fault a countrys flag with an AK47 on it Are they a stable regime now, I have read of Chinas interest in Africa for resources like this

tradetime

tradetime wrote: »

Looking for a test of the 1105 area today S&P, on the way to a reversal of the correction with a break and hold above 1115. FTSE as best I can see would likely test the 5390 - 5400 area in line with the S&P 1115

All systems are go. Good chance we test 1115 today, traders will look to buy dips here, a pullback into the mid 1090's would offer a buying opp.
Many bears are already conceding this battle and looking forwards to a potential double top in the 1150 area, which would make me look towards the sky if we get up that far.
My style of trading always requires me to consider an alternate scenario even if I consider it unlikely, if the wheels were to come off 1085 should now provide support for a bulls regroup

sabretoothtigger

Im starting to wonder if the recent SP500 low was the bottom for now. The reason being it was the trend low to match March and July.

Cable is forming a W formation maybe, I dont know if that applies well to currencies but either it falls today onwards in value or we see a channel breakout in worth of the pound vs dollar.

This would match up with the recent failure in the dollar index which is a primary driver of the equity rally and also gold price, etc
US dollar fell 17% in 2009 and rallyed in the 2008 equity crash and so on

Of course lots of people have their reasons for saying the us dollar has major problems, I dont disagree but I didnt expect it to decline again this quickly or for an equity index bottom to happen

For the moment, cable is falling back and this breakout situation is not happening but if we get $1.61 /£ tomorrow then I guess I will have to think again about being bearish on equities

tonygee wrote: »

Bought RDSB(kitties favourite) on BP weakness,Div this week

I keep seeing BP tipped after it fell back. Sounds good but glad to hear someones buying RDSB as I have some of that.
Both have nice dividends but I wouldnt be surprised if BP was the better performing short term as Shell was later to reorganise and has a longer term strategy based more on Gas I think

Problem with holding them for the dividend is they are cut up into quarters but still I think these stocks are cheaper then they should be.
Big Oil is much more practical then Gold but its barely risen in a year, like 10% or so ? I guess the oil price is more volatile

XOM recently rose on its results

turbobob

sabretoothtigger wrote: »

Im starting to wonder if the recent SP500 low was the bottom for now. The reason being it was the trend low to match March and July.

Its the same story for the FTSE. The primary uptrend support (created by March and July lows) was touched last Thursday and Friday, but not breached.

tradetime

The inverse correlation between the US$ and equities has been a good guide so far, but be careful getting entrenched in the idea, correlations come and go, we can use them while they persist but must always be ready to see the next one. Generally the markets establish correlations long enough for everyone to rely on them, and then they change, they are never set in concrete.

If the US economy is perceived to be recovering more strongly than expected it will drive equity prices, it will also, however, raise expectations of a FED rate hike sooner than expected, and this will drive the US$, so in effect we could switch to a US$ up, equities up.

So while we can use correlations, we have to remember that each market must be analyzed in it's own right, the main driver of a move in the various markets will determine what correlation exists, if any. For the moment the US$ / Equities relationship persists, albeit with a few wobbles.

The one worrying thing that continues to persist is the strength in gold, that could portend to something we haven't seen yet.