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“Rail Project Delay Dampens Market”

“Rail Project Delay Dampens Market”. Why news (Newspaper, TV, rumors) are of little value or significance to disciplined investors using TA?. NST Friday, 12 th Dec. 2003 Headline. “Rail Project delay dampens market” Uncertainty impact : Gamuda, MMC, Main Causalities

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“Rail Project Delay Dampens Market”

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  1. “Rail Project Delay Dampens Market” Why news (Newspaper, TV, rumors) are of little value or significance to disciplined investors using TA?

  2. NST Friday, 12th Dec. 2003 Headline • “Rail Project delay dampens market” • Uncertainty impact : Gamuda, MMC, Main Causalities • Note : MMC : Malaysian Miming Corporation If you happen to own the above shares, as investors what would you do? If you are thinking of buying the share after months of Listening to news or rumors, should you forget about the stocks now?

  3. We are going to demonstrate that : • News or rumors do not really help investors • that we should take our position long before the news • that we formulate strategies to make profit, prevent losses • before investing, not rely on news or rumors. • Just by using the little tools that we learned so far on • “Support & Resistance”. • Later, when we pick up more tools, • We could make wiser investment decision. • [The following MMC graphs are taken on the day of • the Newspaper headline 12th Dec. 2003]

  4. Taking the longest timeframe from Yahoo, we see that today headline is just a small blink (see the red circle) of the overall MMC behavior. The headline reads “Rail Project delay dampens market”, sound so depressing.

  5. A B C The Newspaper did not & will not say or remind investors as earlier as Oct / Nov that MMC hit the resistance 3rd times at “B” – implying investor should take profit or let go first, another warning that before Dec the support at “C” was broken. Implying more weakening of the stock.

  6. The Star Paper, 12th Dec. 2003 “The controversial RM14.5bil double-track railway project must be postponed because the Government has priority for other more important development projects.” All these months, the HOT news / rumors were RM 14.5 bil contract to companies like MMC. Hence the stock price “soared”. Since May 2003 the KLCI also “soared” due to other news or rumors like election, change of PM etc. etc. Let us coolly and objectively manage these news or rumor ….

  7. MMC “soared” since May03, with hot news of RM 14.5 bil contract. But one year ago May02, there was not such hot news, and the price of MMC was much higher (RM 3.5 compared with RM 2.9). What is the use of news and rumor. If not, what do you as investors rely on? In our case, better stick to our Technical Analysis?

  8. B A Do you notice that the many bad news since 2000, Sept 11 attack on US, SARS, Iraq war, terrorism, etc. MMC rise to “A”, as high as “B” in year 1995? Again News and perception do not help investors much, do they?

  9. It pays to be disciplined Technical Analysis investors. Do take the effort to do all the lessons given in this tuition class. Have at least one stock graph for your practicing. With patience and practice, you will soon share my conviction that such investment approach can create WEALTH for ourselves! So far we only use S&R lines, which already give us much clues about investment opportunities and dangers. We need other tools and practice to refine our Investment strategies!

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