Wait and watch earnestly by the sidelines

Dear Friends,

I am waiting and watching earnestly for this last 50 days towards end of the year, for whatever progress the congress might make. Did u see on Friday the action from Wallstreet. Just before Obama speaks the market is up. After his speech, Dow gave nearly back all its gains.

This is an act of "expectation" again. Wallstreet is expecting him to make some positive comments. And in the event he did not make comments up to what the street wants, it is time to profit take, and close position over the weekend!

It seems an episode of QE3 once again. Remember in the 2nd quarter, whenever Ben Bernanke speaks, market will run up because they expect him to announce QE3. But whenever he doesn't, the maket sells down. Before the next appearance again, market runs up because of expectation again.

I would think probably this 50 days it might be that kinda way things work our again. Expectation and disappointment and maybe expectation again.

We might be in for a roller coaster ride until some consensus really come out.

Now we suggest be alert to anything that happens to congress on any information.

In fact, what we think is this recent drop is a good chance for u to benefit! We still consistently believe that the republicans and democrats will come up with a plan to solve things.

Last Friday I was honored to be interviewed by radio station FM95.8 Di Cong and was asked about the technical analysis of US market. From now onwards, I would probably appear on Friday 1.15pm every 2 weeks to give my latest news and strategies on the market.

As I was sharing about TA on FM95.8, I suggest

1) Wait for Dow Jones to come back and stand above the 200 day MA again. 200 day MA represents the confidence of the market. Without it standing above that, professional money may not come in yet.

2) Wait for Dow 10 day MA to turn up. The direction of 10 day MA represents the short term direction of the market. It needs to turn up.

Apart from the charts, please take note of any latest meetings and news from congress. And during this time, please do your research and pick out all the stocks that did well for earnings this season.

Did u see the run-up of Ezion after their earnings release on 6 Nov? Did u see the strength of our 3 local banks after DBS good earnings on 1 Nov?  Did u see Kep Corp collapse? Did u know that their Oct earnings is bad? That is the main reason for the selldown of this stock!

Please note that market although is bad, you can still find gems by focusing on their performance after their earnings release. These companies will be the companies to watch this quarter. They will be the strongest stocks once the market condition turns better.

Rgds
Daniel
www.danielloh.com