It is important that a trader develops a feel of the market. We need to sense how the market is. Today the performance of DOW Jones just shows me something. The market is still bullish, and can't drop much.
Not Even after a 399 points drop at the opening 2 hours.
One way of sensing the sentiment of the market is to take note of what happen during the day when there is a big fall or what happen the next few days after a big day tumble.
Looking at the intraday chart, we can see that the DOW recovers half the points during the session. It is still 2 hours to the closing (3.15am local time now), but looking at this recovery, I have confidence that the bullish momentum is still alive.
The reason for this drop today is because of the bad earnings release from all 3 major companies, Microsoft, P&G and Caterpillar. But overall, I still think this earnings season so far isn't too bad afterall. Overall, 79% of companies have reported actual EPS above estimate The percentage of companies reporting EPS above the mean EPS estimate is above both the 1-year (74%) average and the 5-year (73%) average. Let us see what happen to Apple and Facebook earnings these 2 days...
Again I would like to emphasize that DOW has a major support at 17000!
Do not be worried about STI or KLCI now. The bullish momentum is still strong! STI is now above 3400 and KLCI has zoomed past 1800! I believe they still have legs to run! Today opening may see weaker price, but it won't be for long!
Time to focus a bit on local stocks! There are so many stocks that shows big players are now coming in to scoop up the stocks. Do not waste this opportunity to accumulate them!
In my blog, www.danielloh.com , I did touch on some of the Singapore and Malaysia momentum stocks to watch out for! Take a look.