Advice - CUE/VMS/NGE/EKM???

[steamroller]

Hi,

I have saved up a bit of cash and have been looking at some of these companies, all seem like decent bets. Can anyone recommend one over the others? So many to choose from! I'm not risk averse.

Cheers

[steamroller]

Add NXS into that mix too...

[trackers]

CUE and NGE have amazing assets but poor management. They will both probably do well despite themselves

NXS is due a rerating as soon as it finds a decent CEO and makes some progress re Crux (and it will...but when, is the question..)

CUE have some actual Production, and will no doubt do will when this Artemis business gets sorted...

I personally think NGE is the best risk/return from the above, though its run pretty hard on no news.. As soon as they start drilling at PPL267 they will hit 30's (IMO!) but once again, when that will actually happen and what happens before that time is anyones guess.

[Aotea]

i hold EKM, and love them..they have real potential....

[Crypto Crude]

Read page 4 of the NGE thread... post number 49...
:cool:
.^sc

[Phaedrus]

http://i602.photobucket.com/albums/tt102/PhaedrusPB/NGE.gif
(1) Technically, the strongest of the lot. Rising OBV (not shown) Note, though, the long upper shadow on today's candlestick. This usually means short-term weakness - see the other 2 earlier examples of this. Translation :- Wait for this weakness to resolve itself before buying.


http://i602.photobucket.com/albums/tt102/PhaedrusPB/NXS.gif
(2) Second choice. In a nice uptrend, although showing a little very short term indecision (Doji candlestick) It might pay to delay buying for a short time. Rising OBV


http://i602.photobucket.com/albums/tt102/PhaedrusPB/CUE.gif
(3) Struggling to overcome resistance at 24 cents. OBV also failing to overcome resistance. Not recommended.


http://i602.photobucket.com/albums/tt102/PhaedrusPB/VMS.gif
(4) Flat lining. Going nowhere. Flat OBV. What's to like?


http://i602.photobucket.com/albums/tt102/PhaedrusPB/EKM.gif
(5) In a downtrend. Falling OBV. Too illiquid. Don't even think about it.

[macduffy]

Hi, steamroller.

I'd pay close attention to what Phaedrus has to say on this subject.

In my long and less than stellar experience investing in mining and oil and gas shares I've rarely been able to win through fundamental analysis - which usually means taking a view on the management and prospects of such companies, rather than any analysis of their financials.

This is one area where TA is king. We may not like to think about it but the behaviour of SP's in these companies almost invariably reflect what management and other insiders know about the state of play. If strong technical reasons don't exist the risk is that an investment will end up failing or going nowhere, such as my small stake in CUE - a great prospect on paper but a perennial non-performer.

With a very few exceptions ( BHP, RIO, maybe Newcrest) I now play my miners and oilys very much with both eyes on the charts!

[steamroller]

Thanks for all your help!

I am completely incompetent and TA, and obviously have a lot to learn if I want to do well with these kind of stocks. Anyway, took the plunge with NGE, lets see what happens :t_up:!

Phaedrus, where would be a good place to start learning about charting/TA stuff, like the stuff you posted? Seems you are on the of gurus on this forum...

Regards
steamroller

[STRAT]

Good on ya Steamroller for getting a second opinion.

If you are looking for good TA advice, Phaedrus would be very hard to beat IMO.

By the way as a side note. One becomes a Guru or a Legend here on ST by the number of posts they make. Its got nothing to do with whats in those posts. Worth remembering

[steamroller]

I thought that was the case. STRAT :). Shrewd kinda sucked me into NGE, good to hear Phaedrus saying positive things as well, I feel like I made the right decision (although I would have got it for a cent cheaper if I'd waited an hour...)

[STRAT]

I thought that was the case. STRAT :). Shrewd kinda sucked me into NGE, good to hear Phaedrus saying positive things as well, I feel like I made the right decision (although I would have got it for a cent cheaper if I'd waited an hour...) I thought waiting right now with NGE was the best course of action and Phaedrus more or less said the same. Out of interest What made you take the plunge anyway?

[tobo]

I thought waiting right now with NGE was the best course of action and Phaedrus more or less said the same. Out of interest What made you take the plunge anyway?

perhaps he had his gun loaded and just wanted to shoot something.

[axion]

Phaedrus, where would be a good place to start learning about charting/TA stuff, like the stuff you posted? Seems you are on the of gurus on this forum...



From the horse's mouth back in 2002: http://www.sharechat.co.nz/archives/2002/03/msg00009.shtml

[steamroller]

Pretty much what tobo said >.< I'm easily excited.

[Corporate]

be careful with NGE. I get the feeling that it will be pumped up on the lead up to the drill and dumped easily

[steve fleming]

Hi, steamroller.

I'd pay close attention to what Phaedrus has to say on this subject.

In my long and less than stellar experience investing in mining and oil and gas shares I've rarely been able to win through fundamental analysis - which usually means taking a view on the management and prospects of such companies, rather than any analysis of their financials.

This is one area where TA is king. We may not like to think about it but the behaviour of SP's in these companies almost invariably reflect what management and other insiders know about the state of play. If strong technical reasons don't exist the risk is that an investment will end up failing or going nowhere, such as my small stake in CUE - a great prospect on paper but a perennial non-performer.

With a very few exceptions ( BHP, RIO, maybe Newcrest) I now play my miners and oilys very much with both eyes on the charts!

There is plenty of money to be made from mining stocks on a fundamental basis ( and i exclude O&G which i don't invest in) providing you invest smartly, and get in early.

I have lost count of the number of multi-bagger returns i have had from mining stocks over the years from fundamental investing, including 2 ten baggers (AGS and FDL).... I havent had any multi bagger returns from TA....but maybe that says more about my TA skills!!

[mr.needs]

Phaedrus, where would be a good place to start learning about charting/TA stuff, like the stuff you posted? Seems you are on the of gurus on this forum...


From the horse's mouth back in 2002: http://www.sharechat.co.nz/archives/2002/03/msg00009.shtml

Thanks for posting the link to this axion. Although new to this site, Phaedrus' posts have popped up from time to time and I did wonder where he got all his knowledge and experience from.

Phaedrus keep up the good work! Your posts are both interesting and informative.

[troyvdh]

Dear Steamroller....are you watching CUE...good volumn too...

Disc Hold 100000 CUE

[steamroller]

Yep, definitely watching!

Need a couple weeks before I have any more cash to play with though... in the mean time I will learning a bit more about this TA business and the oilers in general.

Very interesting prospects...

[Crypto Crude]

Corporate-be careful with NGE. I get the feeling that it will be pumped up on the lead up to the drill and dumped easily


corporate,
In other situations oilers can be dumped easily mid drill or in the lead up... This can be the case if they are dependant on well success, or have little other fundamentals for support, so shareholders may take profits... NGE could easily react differently (and I think it will) as the company is fundamentally strong with a 10 billion dollar, large oil project with the majors, right in NGEs back yard...
Now thats just talking about what will happen before final drilling results...

New entrants like Steamroller must be very careful, and think clearly about what they are going to do, because in one afternoon there is a reasonable chance that much of the recent gains will be wiped out if Panakawa fails...

Just like with CSG, the market is in its infancy stage with PNG, as such the market is yet not mature enough to handle failure of Panakawa, and will probably dump NGE back to 15cents...
Im thinking along the same lines as Trackers that this could/should top out near 30cents before final drill announcements come and that alone represents a good trading opportunity...
At this stage I will personally risk it all the way and hold through as the company has great long term prospects that will see the share price up no matter the outcome of this well, and therefore a good medium/long term hedge on failure...
knowing that you have the fundamentals and share price support to rebound the stock after initial selloffs is a good mixture and not easily found in the oil game...
NGE is the goods, but might be better opportunities to buy around 13-15c if Panakawa fails...
either way, NGE gets to one dollar...
with Panakawa success we could get there sooner.. without it, it will just take more time...
Same thing with CUE and Artemis...
:cool:
.^sc

[steamroller]

Well I got into NGE now, saving some cash in the mean time. If Panakawa is a success then great, otherwise I'll just re-buy to lower my average if they shoot down ^.^

[STRAT]

Well I got into NGE now, saving some cash in the mean time. If Panakawa is a success then great, otherwise I'll just re-buy to lower my average if they shoot down ^.^Hi Steamroller below is a little document you should hang on the back of the loo door:scared:. I did:lol:



The “Not-So-Simple” (But Really Utterly So) Rules of Trading
The world of investing/trading, even at the very highest levels, where we are supposed to believe that wisdom prevails and profits abound, is littered with the wreckage of wealth that has hit the various myriad rocks that exist just beneath the tranquil surface of the global economy. It matters not what level of supposed wisdom, or education, that the money managers or individuals in question have. We can make a list of wondrously large financial failures that have come to flounder upon these rocks for the very same reasons. Let us, for a bit, have a moment of collective silence for Long Term Capital Management; for Baring’s Brothers; for Sumitomo Copper… and for the tens of thousands of individuals each year who follow their lead into financial oblivion.
I’ve been in the business of trading since the early 1970s as a bank trader, as a member of the Chicago Board of Trade, as a private investor, and as the writer of The Gartman Letter, a daily newsletter I’ve been producing for primarily institutional clientele since the middle 1980s. I’ve survived, but often just barely. I’ve made preposterous errors of judgment. I’ve made wondrously insightful “plays.” I’ve understood, from time to time, basis economic fundamentals that should drive prices–and then don’t. I’ve misunderstood other economic fundamentals that, in retrospect, were 180 degrees out of logic and yet prevailed profitably. I’ve prospered; I’ve almost failed utterly. I’ve won, I’ve lost, and I’ve broken even.
As I get older, and in my mid-50s, having seen so much of the game–for a game it is, with bad players who get lucky; great players who get unlucky; mediocre players who find their slot in the lineup and produce nice, steady results over long periods of time; “streak-y” players who score big for a while and lose big at other times–I have distilled what it is that we do to survive into a series of “Not-So-Simple” Rules of Trading that I try my best to live by every day … every week … every month. When I do stand by my rules, I prosper; when I don’t, I don’t. I am convinced that had Long Term Capital Management not listened to its myriad Nobel Laureates in Economics and had instead followed these rules, it would not only still be extant, it would be enormously larger, preposterously profitable and an example to everyone. I am convinced that had Nick Leeson and Barings Brothers adhered to these rules, Barings too would be alive and functioning. Perhaps the same might even be said for Mr. Hamanaka and Sumitomo Copper.
Now, onto the Rules:
NEVER ADD TO A LOSING POSITION
R U L E # 1
Never, ever, under any circumstance, should one add to a losing position … not EVER!
Averaging down into a losing trade is the only thing that will assuredly take you out of the investment business. This is what took LTCM out. This is what took Barings Brothers out; this is what took Sumitomo Copper out, and this is what takes most losing investors out. The only thing that can happen to you when you average down into a long position (or up into a short position) is that your net worth must decline. Oh, it may turn around eventually and your decision to average down may be proven fortuitous, but for every example of fortune shining we can give an example of fortune turning bleak and deadly.
By contrast, if you buy a stock or a commodity or a currency at progressively higher prices, the only thing that can happen to your net worth is that it shall rise. Eventually, all prices tumble. Eventually, the last position you buy, at progressively higher prices, shall prove to be a loser, and it is at that point that you will have to exit your position. However, as long as you buy at higher prices, the market is telling you that you are correct in your analysis and you should continue to trade accordingly.
R U L E # 2
Never, ever, under any circumstance, should one add to a losing position … not EVER!
We trust our point is made. If “location, location, location” are the first three rules of investing in real estate, then the first two rules of trading equities, debt, commodities, currencies, and so on are these: never add to a losing position.
INVEST ON THE SIDE THAT IS WINNING
R U L E # 3
Learn to trade like a mercenary guerrilla.
The great Jesse Livermore once said that it is not our duty to trade upon the bullish side, nor the bearish side, but upon the winning side. This is brilliance of the first order. We must indeed learn to fight/invest on the winning side, and we must be willing to change sides immediately when one side has gained the upper hand.
Once, when Lord Keynes was appearing at a conference he had spoken to the year previous, at which he had suggested an investment in a particular stock that he was now suggesting should be shorted, a gentleman in the audience took him to task for having changed his view. This gentleman wondered how it was possible that Lord Keynes could shift in this manner and thought that Keynes was a charlatan for having changed his opinion. Lord Keynes responded in a wonderfully prescient manner when he said, “Sir, the facts have changed regarding this company, and when the facts change, I change. What do you do, Sir?” Lord Keynes understood the rationality of trading as a mercenary guerrilla, choosing to invest/fight upon the winning side. When the facts change, we must change. It is illogical to do otherwise.
DON’T HOLD ON TO LOSING POSITIONS
R U L E # 4
Capital is in two varieties: Mental and Real, and, of the two, the mental capital is the most important.
Holding on to losing positions costs real capital as one’s account balance is depleted, but it can exhaust one’s mental capital even more seriously as one holds to the losing trade, becoming more and more fearful with each passing minute, day and week, avoiding potentially profitable trades while one nurtures the losing position.
GO WHERE THE STRENGTH IS
R U L E # 5
The objective of what we are after is not to buy low and to sell high, but to buy high and to sell higher, or to sell short low and to buy lower.
We can never know what price is really “low,” nor what price is really “high.” We can, however, have a modest chance at knowing what the trend is and acting on that trend. We can buy higher and we can sell higher still if the trend is up. Conversely, we can sell short at low prices and we can cover at lower prices if the trend is still down. However, we’ve no idea how high high is, nor how low low is.
Nortel went from approximately the split-adjusted price of $1 share back in the early 1980s, to just under $90/share in early 2000 and back to near $1 share by 2002 (where it has hovered ever since). On the way up, it looked expensive at $20, at $30, at $70, and at $85, and on the way down it may have looked inexpensive at $70, and $30, and $20–and even at $10 and $5. The lesson here is that we really cannot tell what is high and/or what is low, but when the trend becomes established, it can run far farther than the most optimistic or most pessimistic among us can foresee.
R U L E # 6
Sell markets that show the greatest weakness; buy markets that show the greatest strength.
Metaphorically, when bearish we need to throw our rocks into the wettest paper sack for it will break the most readily, while in bull markets we need to ride the strongest wind for it shall carry us farther than others.
Those in the women’s apparel business understand this rule better than others, for when they carry an inventory of various dresses and designers they watch which designer’s work moves off the shelf most readily and which do not. They instinctively mark down the work of those designers who sell poorly, recovering what capital then can as swiftly as they can, and use that capital to buy more works by the successful designer. To do otherwise is counterintuitive. They instinctively buy the “strongest” designers and sell the “weakest.” Investors in stocks all too often and by contrast, watch their portfolio shift over time and sell out the best stocks, often deploying this capital into the shares that have lagged. They are, in essence, selling the best designers while buying more of the worst. A clothing shop owner would never do this; stock investors do it all the time and think they are wise for doing so!
MAKING “LOGICAL” PLAYS IS COSTLY
R U L E # 7
In a Bull Market we can only be long or neutral; in a bear market we can only be bearish or neutral.
Rule 6 addresses what might seem like a logical play: selling out of a long position after a sharp rush higher or covering a short position after a sharp break lower–and then trying to play the market from the other direction, hoping to profit from the supposedly inevitable correction, only to see the market continue on in the original direction that we had gotten ourselves exposed to. At this point, we are not only losing real capital, we are losing mental capital at an explosive rate, and we are bound to make more and more errors of judgment along the way.
Actually, in a bull market we can be neutral, modestly long, or aggressively long–getting into the last position after a protracted bull run into which we’ve added to our winning position all along the way. Conversely, in a bear market we can be neutral, modestly short, or aggressively short, but never, ever can we–or should we–be the opposite way even so slightly.
Many years ago I was standing on the top step of the CBOT bond-trading pit with an old friend Bradley Rotter, looking down into the tumult below in awe. When asked what he thought, Brad replied, “I’m flat … and I’m nervous.” That, we think, says it all…that the markets are often so terrifying that no position is a position of consequence.
R U L E # 8
“Markets can remain illogical far longer than you or I can remain solvent.”
I understand that it was Lord Keynes who said this first, but the first time I heard it was one morning many years ago when talking with a very good friend, and mentor, Dr. A. Gary Shilling, as he worried over a position in U.S. debt that was going against him and seemed to go against the most obvious economic fundamentals at the time. Worried about his losing position and obviously dismayed by it, Gary said over the phone, “Dennis, the markets are illogical at times, and they can remain illogical far longer than you or I can remain solvent.” The University of Chicago “boys” have argued for decades that the markets are rational, but we in the markets every day know otherwise. We must learn to accept that irrationality, deal with it, and move on. There is not much else one can say. (Dr. Shilling’s position shortly thereafter proved to have been wise and profitable, but not before further “mental” capital was expended.)
R U L E # 9
Trading runs in cycles; some are good, some are bad, and there is nothing we can do about that other than accept it and act accordingly.
The academics will never understand this, but those of us who trade for a living know that there are times when every trade we make (even the errors) is profitable and there is nothing we can do to change that. Conversely, there are times that no matter what we do–no matter how wise and considered are our insights; no matter how sophisticated our analysis–our trades will surrender nothing other than losses. Thus, when things are going well, trade often, trade large, and try to maximize the good fortune that is being bestowed upon you. However, when trading poorly, trade infrequently, trade very small, and continue to get steadily smaller until the winds have changed and the trading “gods” have chosen to smile upon you once again. The latter usually happens when we begin following the rules of trading again. Funny how that happens!
THINK LIKE A FUNDAMENTALIST; TRADE LIKE A TECHNICIAN
R U L E # 10
To trade/invest successfully, think like a fundamentalist; trade like a technician.
It is obviously imperative that we understand the economic fundamentals that will drive a market higher or lower, but we must understand the technicals as well. When we do, then and only then can we, or should we, trade. If the market fundamentals as we understand them are bullish and the trend is down, it is illogical to buy; conversely, if the fundamentals as we understand them are bearish but the market’s trend is up, it is illogical to sell that market short. Ah, but if we understand the market’s fundamentals to be bullish and if the trend is up, it is even more illogical not to trade bullishly.
R U L E # 11
Keep your technical systems simple.
Over the years we have listened to inordinately bright young men and women explain the most complicated and clearly sophisticated trading systems. These are systems that they have labored over; nurtured; expended huge sums of money and time upon, but our history has shown that they rarely make money for those employing them. Complexity breeds confusion; simplicity breeds an ability to make decisions swiftly, and to admit error when wrong. Simplicity breeds elegance.
The greatest traders/investors we’ve had the honor to know over the years continue to employ the simplest trading schemes. They draw simple trend lines, they see and act on simple technical signals, they react swiftly, and they attribute it to their knowledge gained over the years that complexity is the home of the young and untested.
UNDERSTAND THE ENVIRONMENT
R U L E # 12
In trading/investing, an understanding of mass psychology is often more important than an understanding of economics.
Markets are, as we like to say, the sum total of the wisdom and stupidity of all who trade in them, and they are collectively given over to the most basic components of the collective psychology. The dot-com bubble was indeed a bubble, but it grew from a small group to a larger group to the largest group, collectively fed by mass mania, until it ended. The economists among us missed the bull-run entirely, but that proves only that markets can indeed remain irrational, and that economic fundamentals may eventually hold the day but in the interim, psychology holds the moment.
And finally the most important rule of all:
THE RULE THAT SUMS UP THE REST
R U L E # 13
Do more of that which is working and do less of that which is not.
This is a simple rule in writing; this is a difficult rule to act upon. However, it synthesizes all the modest wisdom we’ve accumulated over thirty years of watching and trading in markets. Adding to a winning trade while cutting back on losing trades is the one true rule that holds–and it holds in life as well as in trading/investing.
If you would go to the golf course to play a tournament and find at the practice tee that you are hitting the ball with a slight “left-to-right” tendency that day, it would be best to take that notion out to the course rather than attempt to re-work your swing. Doing more of what is working works on the golf course, and it works in investing.
If you find that writing thank you notes, following the niceties of life that are extended to you, gets you more niceties in the future, you should write more thank you notes. If you find that being pleasant to those around you elicits more pleasantness, then be more pleasant.
And if you find that cutting losses while letting profits run–or even more directly, that cutting losses and adding to winning trades works best of all–then that is the course of action you must take when trading/investing. Here in our offices, as we trade for our own account, we constantly ask each other, “What’s working today, and what’s not?” Then we try to the very best of our ability “to do more of that which is working and less of that which is not.” We’ve no set rule on how much more or how much less we are to do, we know only that we are to do “some” more of the former and “some” less of the latter. If our long positions are up, we look at which of those long positions is doing us the most good and we do more of that. If short positions are also up, we cut back on that which is doing us the most ill. Our process is simple.
We are certain that great–even vast–holes can and will be proven in our rules by doctoral candidates in business and economics, but we care not a whit, for they work. They’ve proven so through time and under pressure. We try our best to adhere to them.
This is what I have learned about the world of investing over three decades. I try each day to stand by my rules. I fail miserably at times, for I break them often, and when I do I lose money and mental capital, until such time as I return to my rules and try my very best to hold strongly to them. The losses incurred are the inevitable tithe I must make to the markets to atone for my trading sins. I accept them, and I move on, but only after vowing that “I’ll never do that again.”

[Crypto Crude]

in the mean time I will learning a bit more about this TA business


If Panakawa is a success then great, otherwise I'll just re-buy to lower my average if they shoot down

LOL steamroller,
the TA gods wont be happy you said that....
Phaedrus will tell you that averaging down is criminal...

yes,
normally it is... but these are not normal stocks...
:)
.^sc

[Crypto Crude]

yup,
there you have it... rule number 1 in strats post...
:eek2:...

Strat,
if you found something real special,
it only comes around every 10 years...
(in NGEs case), these characteristics might not be seen again...
I aint seen them before, Im not sure if I will see them again...
In this example you would have to throw TA rules out the window...?
:cool:
.^sc

[STRAT]

yup,
there you have it... rule number 1 in strats post...
:eek2:...

Strat,
if you found something real special,
it only comes around every 10 years...
(in NGEs case), these characteristics might not be seen again...
I aint seen them before, Im not sure if I will see them again...
In this example you would have to throw TA rules out the window...?
:cool:
.^scHell no Shrewdy. Never throw the TA away.

You said yourself in an earlier post if this drill goes bad we might see 15c again. What is most important is not to ride it down and to catch it near the bottom when it starts rising. I bought into this purely because I trust and respect your judgement but I got mine a lot cheaper with TA :D

Right now if this one slides back 3c Steamroller and yourself have a paper loss and have to decide if you will ride it out ( I know you will ) not knowing how long that will take, how much lower it will go or what opportunities may be missed mean time. I will still be above water and able to sell without a loss if I suddenly need the money for something moving fast ( shares not cars )

TA rules dude

If NGE is as hot as you say the Market price will reflect that. Trading in and out a few times along the way will only increase your holding and the net worth of your portfolio. Dont you reckon?

[Crypto Crude]

If NGE is as hot as you say the Market price will reflect that.


not necessarily, not yet anyway...
that is why im buying a 20cent stock that has a clear path to a buck without ...
explor success at Panakawa...
FA Share investing is all about finding assets/stocks that the market has mispriced... assets the market has not reflected into the market cap...
... assets the market does not know how to value (because they are not mature enough)... assets the market has misjudged the risks involved... assets that are not discounted properly... assets where the market has not used foresight on how projects will advance..... assets that have different weightings...assets that have been written off (like CUES PNG assets-because the region was once stranded)...... but just like CUE, they had the foresight to see the majors coming in, and started picking up these stranded permits in PNG on the cheap in the hope of future regional development...
and guess what, its happening...

why does the market behave like this? because those revenue streams are uncertain... and because the assets are hard to value...


This is what share investing for a FA guy is like...
NGEs marlket cap is not valued accordingly, because the market has failed to value the company for firstly, the location of its permits it holds... the fact that a 10 billion dollar LNG project will be running a pipeline right across from our two permits in the North, and that there is big exposure with Large oil buzzing around with good drilling success rates in the region to boot...and NGE with 150% more acerage than OSH...


The only way to resolve these issues around valuing a company is the time and return of holding an investment/project to maturity... that is the return... that is the payoff...

when the info changes for the worse, then you get out... when the info stays the same or gets better as time passes, then you hold...
you wait until market mechanics resolve themself...
The market will in time signal to us if PNG is warranted of these big returns...
This is signalled through buying activity of investors that make up the market...
early indicators (read the recent NGE presentation), and these mergers, acquisitions, takeovers, JVs, look very promising...

time is the factor...

with OSH set to triple production in 4 years, and add 500 million barrels oil (BOE), how much has the market factored into the m cap?
stuff all... still infancy stage project that is really going to lift off in one of the most prospective regions in South East Asia... so much upside...

The whole market crash has been an FA guys nightmare...
but a TA guys dream...
now im totally back on track, made it all back and then some...
And rolling like the good old days...

:cool:
.^sc

[trackers]

Hi Phaedrus (if you're out there),

Do you use candlesticks as default when looking at individual stocks? Why?

Also, in terms of NGE, do you give more weight to a rising OBV or an overbrought signal given by RSI?

[gazprom1]

[QUOTE=STRAT;300876]Hi Steamroller below is a little document you should hang on the back of the loo door:scared:. I did:lol:

Now, onto the Rules:
NEVER ADD TO A LOSING POSITION
R U L E # 1
Never, ever, under any circumstance, should one add to a losing position … not EVER!
Averaging down into a losing trade is the only thing that will assuredly take you out of the investment business. This is what took LTCM out. This is what took Barings Brothers out; this is what took Sumitomo Copper out, and this is what takes most losing investors out. The only thing that can happen to you when you average down into a long position (or up into a short position) is that your net worth must decline. Oh, it may turn around eventually and your decision to average down may be proven fortuitous, but for every example of fortune shining we can give an example of fortune turning bleak and deadly.
By contrast, if you buy a stock or a commodity or a currency at progressively higher prices, the only thing that can happen to your net worth is that it shall rise. Eventually, all prices tumble. Eventually, the last position you buy, at progressively higher prices, shall prove to be a loser, and it is at that point that you will have to exit your position. However, as long as you buy at higher prices, the market is telling you that you are correct in your analysis and you should continue to trade accordingly.
as one holds to the losing trade, becoming more and more fearful with each passing minute, day and week, avoiding potentially profitable trades while one nurtures the losing position.

Strat/SC,

Sorry to come back to this old chesnut but I am generally an FA investor and my FIRST rule is: if I own a position and it falls back or drops dramatically then I re look at the basis on which I invested. If this basis is still valid then I ALWAYS add to a losing position. I respect Phaedrus' views very much but we all have different styles. I am not going to list investments that I have made over the years but PROVIDED the fundamental analysis is correct and the basis for investing is still valid, I will double/triple down. Obviously, if you are a FA investor with good TA skills you can get in and out and not ride the stock all the way down.

Do not want to write a book but RULE 2: don't be too greedy and leave some money/upside on the table for the next investor!!!

Gazprom

[axion]

Strat/SC,

Sorry to come back to this old chesnut but I am generally an FA investor and my FIRST rule is: if I own a position and it falls back or drops dramatically then I re look at the basis on which I invested. If this basis is still valid then I ALWAYS add to a losing position.
Gazprom

It all depends on if you can be objective or not. For most people having money in the game leads them to get emotional and thus irrational. Things like staying in share X because you're down on your position in that share and you have to make the money back from it ("It owes me!"). Or justifying your losing position by saying that it's the market who is wrong not you, and then topping up the position.

[Phaedrus]

Hi Phaedrus, do you use candlesticks as default when looking at individual stocks? Why?Yes, especially for short-term analysis. Why? Because candlesticks contain valuable extra information and give much more insight into market dynamics than can ever be provided by viewing the Close in isolation.


In terms of NGE, do you give more weight to a rising OBV or an overbought signal given by RSI?Uptrending stocks usually spend appreciable periods of time technically "overbought". Other than indicating a bad time to buy, these mean very little and as such are hardly noteworthy. On the other hand, a rising OBV means that the uptrend continues to be supported by volume - a falling OBV with a rising shareprice would be a cause for concern.

[geezy]

Hell no Shrewdy. Never throw the TA away.

You said yourself in an earlier post if this drill goes bad we might see 15c again. What is most important is not to ride it down and to catch it near the bottom when it starts rising. I bought into this purely because I trust and respect your judgement but I got mine a lot cheaper with TA :D

Right now if this one slides back 3c Steamroller and yourself have a paper loss and have to decide if you will ride it out ( I know you will ) not knowing how long that will take, how much lower it will go or what opportunities may be missed mean time. I will still be above water and able to sell without a loss if I suddenly need the money for something moving fast ( shares not cars )

TA rules dude

If NGE is as hot as you say the Market price will reflect that. Trading in and out a few times along the way will only increase your holding and the net worth of your portfolio. Dont you reckon?



but i guess u do need to monitor on a daily basis with TA? What if you have no time for that?

[STRAT]

Hi Geezy.
It only takes a few minutes a day per stock. I would find the time

[Phaedrus]

I guess u do need to monitor on a daily basis with TA.....Not at all. Because Technical Analysis is often used for short-term trading, many people assume that it is unsuitable for the long-term investor. This is not correct. By using Trend indicators and selecting long time periods, useful long-term entry and exit signals can be generated. The longer the time period chosen, the less sensitive the indicator, the slower it is to respond to any changes in price action, the fewer the signals generated and the less frequently it needs to be monitored. Checking your stocks weekly or even monthly would be quite appropriate for longer-term active investors. There is, of course, a trade-off between signal frequency and timeliness. The object is to choose indicators and periods that generate signals compatible with your preferred level of activity.

[STRAT]

Thanks Phaedrus I was just going to add something similar to my post above.

I watch new entries every day but stocks I have held a while which are way above water say only once a week.

I think it pays to watch sector prices and world Markets more often though. A lot can happen in a week out there

[steve fleming]

http://i602.photobucket.com/albums/tt102/PhaedrusPB/EKM.gif
(5) In a downtrend. Falling OBV. Too illiquid. Don't even think about it.

Not meaning to have a go here, but it is interesting to see EKM now up 40% in the couple of weeks since this post (from 8.9 to 12.5). Very stong the last couple of days on very good volume.

A new gold province is slowly being uncovered!

[Phaedrus]

When that "snapshot" was taken on 13/4/10, EKM was technically the weakest of the 4 stocks, but within just a few days the situation had been reversed as EKM began firing off Buy signals left right and centre, for example :-

OBV stopped falling and began rising
OBV trendline broken
Stochastic oscillator oversold and rising
Stochastic oscillator trendline break
Break of confirmed trendline
Uptrend confirmed.

Lightly traded stocks like EKM can be pushed around by relatively small increases in buying (or selling) pressure. This makes them more volatile and it is harder to acquire a meaningful stake without pushing the price up. Nevertheless, after having given all those Buy signals at 9.8 to 10 cents, EKM stayed at around that level for about a week, giving a little more time to build up a holding.

The current uptrend is not showing any signs of weakening, as yet.

http://i602.photobucket.com/albums/tt102/PhaedrusPB/EKM430.gif

[soulman]

I got in at the right price of 10 but exited too soon at 11.5. EKM, in term of FA are very sound and should do well in the LT. I still hold a small batch at 15, bought a while ago.

[tricha]

WELL looking at the result from the T\A guru, T\A on these shares has been a complete joke, a complete waste of time and a loss. So before you rate someone else again Phaedrus, think long and hard about what, your rating is on this one.

1st choice - buy - NGE 23 cents now 22 cents. worst !!!!!!!!!!!!!

2nd choice - buy - NXS 28 cents still 28 cents.

3rd choice CUE 23.5 cents now 29.5 cents - 3) Struggling to overcome resistance at 24 cents. OBV also failing to overcome resistance. Not recommended.



VMS 35 cents now 38.5 cents 4) Flat lining. Going nowhere. Flat OBV. What's to like?



and we have the winner, EKM 8.9 cents now 13.5 cents. (5) In a downtrend. Falling OBV. Too illiquid. Don't even think about it.

[Phaedrus]

T\A on these shares has been a complete joke, a complete waste of time and a loss.

Comprehension has never been your strong suit, Trich. Read my post again, more carefully this time.

I did NOT say to buy NGE as you claim I did - in fact I specifically noted weakness and advised waiting before buying. NGE has now fallen back to the trendline marking the lower limit of its trend channel, making it a buy at 22 cents for those unconcerned by Friday's Gravestone Doji. Right now, NGE's "medium-term" uptrend is still intact with a confirmed trendline in place.

NXS. Again, I did not say to buy, but rather noted some "very short term indecision" and recommended that "it might pay to delay buying for a short time". The next day closed Up, resolving this indecision and giving an entry at 28.5 cents. NXS then took off in a very steep uptrend. No trend lasts forever, and on 21/4/10 this one ended when NXS made a lower low and a lower high giving an exit at 33.5 cents equating to a profit of over 2.5% per day. Not bad!

CUE 13/4/10 comment :- "Not recommended" WHY? Because CUE was failing to overcome the historical resistance at 24 cents and because the OBV was flat. Abruptly, the very next day, the situation changed completely. CUE broke above the former resistance level on very heavy volume, sending the OBV rocketing up. Now, you are probably unaware of this, Trich, but a breakout above previous resistance is a very strong Buy signal - one of the best, in fact. This one gave an entry at 26 cents and CUE has risen strongly since then.

VMS 13/4/10 comment :- "Flat lining. Going nowhere. Flat OBV. What's to like?" Two days later - plenty! The previous resistance at 35 cents that had been tested 5 times in 3 months was smashed. VMS was now in a confirmed uptrend and the OBV was rising. Currently well in profit after an entry at 36.5 cents on the basis of the breakout above previous 35 cent resistance.

EKM 13/4/10 comment :- "Don't even think about it" WHY NOT? Because, of these 5 stocks, EKM was the weakest and the only one in a downtrend. The OBV was falling and price action was all below a confirmed downward trendline that had been unbroken since October 2009. As you can see from the chart above, 6 days later, EKM was in an uptrend, the OBV was rising and the confirmed downward trendline had been broken, giving multiple entry signals at 10 cents. The tide had turned. EKM continues to climb.

Tricha, far from being "a complete joke, a complete waste of time and a loss" TA has flagged useful and very profitable signals on these stocks. Your criticism is based on ignorance and stems from a failure to recognise that the sharemarket is a very dynamic environment and that circumstances change - sometimes very quickly. When they do, we must change with them. You seem to have great difficulty grasping this concept and appear to have little or no knowledge of TA itself. I recommend that you read "Technical Analysis of the Financial Markets" by John Murphy and try to gain some understanding of the basic principles involved. Candlesticks, too, would give you a degree of valuable market insight that you lack. A good introductory text that could help you a lot is "Japanese Candlestick Charting Techniques" by Steve Nison.

[mattyroo]

Comprehension has never been your strong suit, Trich. Read my post again, more carefully this time.

Nail meet head! Tricha's only strong point is histrionics - he should be writing headlines for the News of the World, he is so adept at sensationalism.

[tricha]

Comprehension has never been your strong suit, Trich. Read my post again, more carefully this time.

I did NOT say to buy NGE as you claim I did - in fact I specifically noted weakness and advised waiting before buying. NGE has now fallen back to the trendline marking the lower limit of its trend channel, making it a buy at 22 cents for those unconcerned by Friday's Gravestone Doji. Right now, NGE's "medium-term" uptrend is still intact with a confirmed trendline in place.

NXS. Again, I did not say to buy, but rather noted some "very short term indecision" and recommended that "it might pay to delay buying for a short time". The next day closed Up, resolving this indecision and giving an entry at 28.5 cents. NXS then took off in a very steep uptrend. No trend lasts forever, and on 21/4/10 this one ended when NXS made a lower low and a lower high giving an exit at 33.5 cents equating to a profit of over 2.5% per day. Not bad!

CUE 13/4/10 comment :- "Not recommended" WHY? Because CUE was failing to overcome the historical resistance at 24 cents and because the OBV was flat. Abruptly, the very next day, the situation changed completely. CUE broke above the former resistance level on very heavy volume, sending the OBV rocketing up. Now, you are probably unaware of this, Trich, but a breakout above previous resistance is a very strong Buy signal - one of the best, in fact. This one gave an entry at 26 cents and CUE has risen strongly since then.

VMS 13/4/10 comment :- "Flat lining. Going nowhere. Flat OBV. What's to like?" Two days later - plenty! The previous resistance at 35 cents that had been tested 5 times in 3 months was smashed. VMS was now in a confirmed uptrend and the OBV was rising. Currently well in profit after an entry at 36.5 cents on the basis of the breakout above previous 35 cent resistance.

EKM 13/4/10 comment :- "Don't even think about it" WHY NOT? Because, of these 5 stocks, EKM was the weakest and the only one in a downtrend. The OBV was falling and price action was all below a confirmed downward trendline that had been unbroken since October 2009. As you can see from the chart above, 6 days later, EKM was in an uptrend, the OBV was rising and the confirmed downward trendline had been broken, giving multiple entry signals at 10 cents. The tide had turned. EKM continues to climb.

Tricha, far from being "a complete joke, a complete waste of time and a loss" TA has flagged useful and very profitable signals on these stocks. Your criticism is based on ignorance and stems from a failure to recognise that the sharemarket is a very dynamic environment and that circumstances change - sometimes very quickly. When they do, we must change with them. You seem to have great difficulty grasping this concept and appear to have little or no knowledge of TA itself. I recommend that you read "Technical Analysis of the Financial Markets" by John Murphy and try to gain some understanding of the basic principles involved. Candlesticks, too, would give you a degree of valuable market insight that you lack. A good introductory text that could help you a lot is "Japanese Candlestick Charting Techniques" by Steve Nison.

Well sorry if I read you wrong Phaedrus, I thought you gave a 1 - 5 meaning best pick to worst pick, based on T\A :confused:

[steve fleming]

There is plenty of money to be made from mining stocks on a fundamental basis ( and i exclude O&G which i don't invest in) providing you invest smartly, and get in early.

I have lost count of the number of multi-bagger returns i have had from mining stocks over the years from fundamental investing, including 2 ten baggers (AGS and FDL).... I havent had any multi bagger returns from TA....but maybe that says more about my TA skills!!

This thread was started exactly a year ago (13/4/10)...interesting revisiting it today...

Over the last year, EKM have gone from 8c to 65c.

My EKMO have become a 50-bagger.

Just illustrates, as i said in the above post 12 months ago, that there is plenty of money to be made from mining stocks on a fundamental basis providing you invest smartly, and get in early.

[dragonz]

well done steve.