Thursday, December 3, 2009

I’ve done some calculations you will find amazing! You can’t miss out on this opportunity to see how much money was made over the last 3 days!

It will only take about 1 minute for you to go over the basic stock market money PROFITS set out below!


Our special stock market update sent during the morning of the 27th November stated the following:

"We find the market selling off in droves today as we discussed at the meeting this week and in our newsletter and update earlier mid week..."

"Kumba has pulled back to the neck line of 25000 odd. Keep an eye on this level this afternoon for signs of hammers."

"Similar with Northam @ 20ema and 50ema, Lonmin @ 20ema (R209) with 50ema as critical."

"ALSO watch Anglo American now at 10ema and other RESI and base metals shares. Watch Pharmaceuticals, Industrial and Technology sector based shares as these sectors show highest strength on the market. PSG 20ema is 2429c however this share is thinly traded. Line support of the old high is 2353c."

"Exxaro is at the entry price of the moving average convergence of 9030c again."

In addition, the global indices like S&P 500, Dow Jones, FTSE100 and DAX would also be excellent buying opportunities!

What price are they now?

Northam entry @ 3900 - price as at close of 2nd December at 4198 (7.6% in 3 days)
Kumba entry at 24700 - price as at close of 2nd December at 26500 (7.3% in 3 days)

Lonmin entry at 20900 - price as at close of 2nd December at 23201 (11% in 3 days)

PSG entry at 2429 - price as at close of 2nd December at 2431 (no move in 3 days

Standard Bank at 9300 - price as at close of 2nd December at 9724 (4.3% in 3 days)
Anglo American at 31000 - price as at close of 2nd December at 33164 (7% in 3 days)

Exxaro at 9100 - price as at close of 2nd December at 9230 (1.8% in 3 days) but it did got to 9560 on Tuesday (5%)!

How Much Money was MADE by our Wealth Club Members?

If you were trading with any geared instruments like CFDs, Single Stock Futures or Spreads you would have an average of 5.5% profits (including only 1.8% in Exxaro although we closed at 9500) if you took all of the trades listed above.

For every R5000 you had traded you now have R2500, less brokerage of estimated R500, per stock traded. In essence in 3 days you would've made R2000 for R5000 you traded in the stock market since Friday 27th!

That's a whopping 40% profit in just 3 days - That's just 1 way you make money on the stock market!

In just 3 days, using our Wealth Club Subscription newsletter, you not only made money enough to pay for a year's Wealth Club membership but much more money for yourself! How much is that worth to you?

What if we can help you do this every month? Subscribe now to Wealth Skill's Club! Or come on our stock market courses or enquire about our personal trading coach programme or our stock broker / prop dealer consultancy!

Bear in mind that some of these positions will be held by our Medium Term Investors as wealth creation tools for at least a few weeks to a number of years! The above scenario illustrates opportunities for short term traders and may not reflect on future earnings. Trading is risky. Returns are not guaranteed. Understand your risk and ensure you trade with money you can afford to lose.

Trade well, not often!
All the best investing this quarter,

Financial & Investment Workshops, ebooks & financial freedom @

Visit Aurora Global Markets for Global trading platform in equities, foreign exchange, commodities, precious metals and interest rates.

Friday, November 27, 2009

Stock Market Update

Stock Market Updates:

Our recent stock market newsletter, sent 23rd November, stated that the markets were very top heavy, meaning they were at resistance levels. We advised that investors should remain out of the stock market until further notice.

"If investors or traders are holding positions that they should either look to exit at these resistance levels (traders)or be prepared to hold through the correction (investors) and then add to their holdings."

The Shanghai was the early indicator of the stock market weakness at resistance levels. The DAX then followed by making a lower top or lower high. These signals need to be heeded.

Then we heard about the Dubai World debt crisis. It only takes a small bit of negative news to discount the current stock market perceptions and create a sell off that we have noticed using technical analysis on the charts.

The interesting thing about the Dubai crisis is that the news is old. Maybe not to the public and the man in the street but the investors and bankers all knew about the announcement to come at least a few days before it was announced. Conspiracy? Yes, somewhat. Read the charts. Ask some questions!

Why didn't the global markets make new highs this week? The S&P 500, the Dow Jones, the DAX, Shanghai, FTSE 100 and even the local All Share Index in South Africa could not bring themselves to make new highs and break the resistance. The stock markets couldn't break this level as bad news was coming. The smart money was preparing to move out of the markets temporarily. They gave you and I, the little guy, warning for about 5 days.

The next question is, "Did you heed the warning?" Many people trying to invest and trade the stock markets aren't able to handle the emotional journey. They suffer from the emotional pull of the stock markets with fear after a sell off or correction or even recession with the greed that the stock markets will always climb higher. TIP: The stock markets never go up or down in a straight line! They always experience cycles.

How do stock market cycles work?
You get small micro cycles which people trade intra-day or in very short term periods of 1-3 days. You get swing cycles otherwise known as swing trades which can last from 3 days to 3 or 4 weeks. You also get minor cycles which can last for 3 weeks to around 3 months, sometimes extended through to 6 or even 9 months. The major cycles are those we see in the stock market as we go from stock market boom to stock market bust! Which time frame do you want to play in?

I teach people to take advantage of any one of these time frames. Different people enable different choices and needs and ability. some people can handle the daily emotional ebb and flow of intra-day trading... it's only a select few that can actually make a success of short term trading in the intraday arena. Perhaps as few as 2% of people can actually handle this form of trading.

The next type of person is a short term trader that can take trades from 1-3 days and also require especially strong emotional and mental discipline. So, 90% of the reason you will make money or loss it will be down to your personal psychology. About another 3% of people can handle this type of stock market trading.

The easier time frame to be involved in would be the swing trade! This stock market cycle is much easier on the energy, mental and emotional discipline as well as time required to short term trade. Many more people are able to take advantage of this stock market cycle also called a swing trade. It does take some practice as well as much skill in chart analysis. This can be learnt.

The simplest time frame is that of the investor or a major stock market cycle. We've just entered into the next 5-year boom cycle on the stock market and you could simply buy good shares in good sectors and leave them for 4 and a half years. My only TIP would be that you ensure that the sector and shares remain above the 89-day moving average. Do that and you can get good returns on average.

However, if you want better than average returns, you would need to shorten your stock market cycle and focus more on the swing trades to make money as the different sectors grow and pull back. Each time, you are making money in the growth cycle and exit at resistance levels. Then invest again in sectors that are performing to compound your portfolio growth.

Take the time to learn stock market cycles. Then train your emotions to be patient for entries and resilience to exit at resistance. Repeat!

Financial & Investment Workshops, ebooks & financial freedom @

Visit Aurora Global Markets for Global trading platform in equities, foreign exchange, commodities, precious metals and interest rates.

Monday, November 23, 2009

Dollar Weakens & Commodities Rally!

Dollar Weakens & Commodities Rally!

It's not entirely what I was expecting but the global markets seriously rallied today after the dollar took a pounding (ahem, excuse the pun)!

With that being said about commodities rallying, GOLD hit a new high again and is well on its way to my medium target of $1350! So hold on to the rodeo horse cos it's going to be a fun ride!

My favourite share of the moment, Kumba also closed up very strongly today. I missed the entry at 25000 by R1.00 on Friday with my automatic order in the system. Sometimes you get the trade, sometimes you don't. It would've been a fantastic entry however as the share closed R9.00 up from low of Friday.

Also, Anglo American and PSG were good trades today and I like the look of Datatec too. There is some convergence of the moving averages on that chart.

Platinum also pulled back on Friday and although it didn't quite reach my support level it certainly did weaken considerably. It gave entries to my other favourites Lonmin and Northam platinum. Both up on the day with Lonmin moving over R10 to the good which puts it at about 5% for the day. Can't complain!

Short term trading can still be exciting on day's like this when the markets run in your favour and you know you going to bank some serious profits over the next day or two. Stock market trading is not supposed to be a full time job. Learn to take short term trades with high profitability over time with consistent success!

Do this and you write yourself cheque for life! And you can enjoy life with some stock market trading inbetween!

Trade well, not often.

Financial & Investment Workshops, ebooks & financial freedom @

Visit Aurora Global Markets for Global trading platform in equities, foreign exchange, commodities, precious metals and interest rates.

Thursday, November 19, 2009

Global markets at resistance

"Global markets at resistance" was the main heading for my recent issue of Stock Market Outlook, a trading newsletter I write for a club membership database on a weekly basis.

This weekly investment newsletter and trader's update focuses on the global indices, global commodities and then local stocks in South Africa as well as the Resources index and FINDI index.

I spoke about trading KUMBA Iron Ore last week Monday when it opened at 23200 and ended up at 26600 yesterday. Only 8 days to achieve over 10% return! That's no playing around! It's also not geared either. My medium term target for Kumba is 32000.

I was long of S&P 500, Wall Street and DAX last week to close near the highs of the top of the channels on these indices.

This week, the focus was off the stock markets and onto gold again. After sitting on $1000 it rallied back to my target of $1150within a very short space of time.

Now I wait for the global markets to settle at or near their support levels on the channel. Once this happens which should be by early next week I will be taking short term trades in the stock market again.

As the dollar weakens, commodities will rise. It is a patient game waiting for the dollar to turn, find resistance in its decline and then continue its downward movement. It is the opportunity to take longs on commodities again and stocks that mine those commodities.

It's fascinating but there's always something to learn.

Short term trading is't all its cracked up to be. People have a romantic disbelief about how exciting it is. The reality is that trading is mostly boring and repetitive.

It's a great hobby for retired persons and people who have wads of money. It is NOT for someone trying to replace their job.

Some people however, can find the happy medium of having a job and being patient while waiting for the trades to come. Building confidence in their trades but also mental discipline. Lastly growing their portfolio size over time like a professional golfer.

Support levels on the S&P 500 are 1093 in the short term. For the DOW it be 10100. The DAX is around 5400. KUMBA support is 24900 but could extend to 24400 odd intraday before closing on a hammer candle formation as example.

Watch the dollar. Keep an eye on the Baltic Dry Index. Copper is also a good early indicator as prices start to edge up.

Have a great trade,

Financial & Investment Workshops, ebooks & financial freedom @ NEWSWEEK

Visit Aurora Global Markets for Global trading platform in equities, foreign exchange, commodities, precious metals and interest rates.

Thursday, October 22, 2009

Oil moves to $80

After my little rendezvous with gold the next trade position was oil... As it struggled to move passed $72 for a while it was bound to break.

As the dollar weakens, you will have oil and gold gain value due to their value being derived in dollar terms. Weak dollar translates into strong commodities!

So, looking for something else to stick our teeth into while gold consolidates its new level of $1050 support, I traded oil from $72 to $80 over the last week or so. Very tidy little trading profit!

Trading stock markets and trading commodities is simple if you can follow the market cycle and waves. If you understand the relationship between dollar currency, commodity prices and stock market sectors then you can make good profit out of trading.

Right now, it's time to take a breather. Wait for the week to finish off... But I won't be far away in case something triggers a trade position.

All the best trading!

Financial & Investment Workshops, ebooks & financial freedom @

Visit Aurora Global Markets for Global trading platform in equities, foreign exchange, commodities, precious metals and interest rates.

Thursday, October 8, 2009

It's my Gold Rush!

I've been bullish on gold for over a month now! What a rush!

Ever since the gold price pushed to test the support level at around $915 little over 6 week's ago I was bullish. The upside target on the gold chart is $1250!

Now from the small pull back from $1024 level to $990 again the gold price has shot up to a record of $1050 since Monday. The gold index in South Africa has skyrocketed almost 10%!

What's the reason? Some of the reason is due to the dollar weakness in the global economy as inflation takes it's toll. But also there has been a debate about the price of oil being derived from a basket of commodities rather than the dollar alone.

Guess which commodity is being considered as part of the basket of assets to price oil in future?

You got it! It's GOLD!

The Australian FED bank also increased interest rates as the first bank to start doing so as the global economy shows signs of ticking up. The combination of all these things has pushed the gold price to break records!

The medium term outlook on gold is to target $1250. We will have various waves of upswing followed by profit taking before we get there.

Be prepared to ride the waves and walk away with reasonable trading profits! Don't be greedy!

I've moved my stop loss levels to entry now. Looking to close half of my positions on the stock market in the resources sectors.

For our weekly Market Outlook newsletter visit our website link below:

Financial & Investment Workshops, ebooks & financial freedom @

Visit Aurora Global Markets for Global trading platform in equities, foreign exchange, commodities, precious metals and interest rates.

Saturday, September 19, 2009

Forex Trading Platform Review

Forex Trading Platform Review

There comes a time when a currency trader wants to know what else is available out in the currency market when it comes to trading platforms. I've decided that I am going to do some forex trading platform reviews over the next few weeks.

There are some big promises being made by these different trading platforms and forex trading companies providing currnecy trading services. Some of these trading platforms offer you 'free money' to start trading after you open a trading account.

There are some groups that offer free demo accounts for trading as well as good support. Some trading platforms I will be reviewing also include equities, commodities, precious metals and more. Imagine trading currency as well as your local stock market equities and commodities directly!!

Our first review is going to be a multiplatform.

Aurora Global Markets is a financial services company based in the UK and regulated by the Financial Services Authority. Its wholesale services for financial institutions include: Global trading platform in equities, foreign exchange, commodities, precious metals and interest rates. Asset management services that can be linked to the trading platform including program trading and third party discretionary management.

What about another well known trading platform provider called AVA FX Online where you get some fantastic deals:

~ Open a free $100,000 currency account with ava fx and practice online trading. It's a great way to experience trading in the currnecy market without risking any money. The opportunity for you to learn, or to enhance your trading skills is one simple registration away.

~ Open the real currency account and begin trading with $100 with the chance for a free bonus of up to $1200 on your account!!

I've got loads more work to do to fill you in on the top trading platforms available out there and what they offering. It's a challenge I take up eagerly.

What's the benefit about a review? You will benefit from seeing what the different trading platforms offer and what their trading costs are.

Get to learn who the best of the trading platforms are over the next few weeks!

Financial & Investment Workshops, ebooks & financial freedom @

Visit Aurora Global Markets for Global trading platform in equities, foreign exchange, commodities, precious metals and interest rates.

Saturday, August 29, 2009

Forex Trading Room

It has been a while since I last posted. There's a good reason for that! I have been working on a new currency trading experience that I believe you would absolutely profit from!

Give me a minute to tell you more!

I have been working with a Forex Trading Pro that averages around 30% per month online trading money profits! How does he do it? Well, it's a mix of consistently trading a strategy and ensuring trading discipline regarding risk management.

If you don't know what these two things mean, then we can point you in the right direction! Believe me, YOU can't become a consistently successful Forex Trader without mastering risk and reward together with trading discipline.

How can we help you to achieve these two pillars of success? Well, Forex Trading Pro is now offering a membership Forex Trading Room that runs monthly. You decide to become a member of the Forex Trading Room and Forex Trading Pro teaches you his strategy, risk to reward method and discipline every day for a month.

If a month isn't enough, you have the option to renew your membership and KEEP it going for as long as you need to so you CAN achieve your currency trading goals of making money online.

Let me know if you want to get more details.

P.S. I've personally seen Forex Trading Pro make money online by trading currencies and make 8% return over 48 hours!

P.S.S. What could you do with regular profits derived from making money online while trading currencies from your own home?

Financial & Investment Workshops, ebooks & financial freedom @

Tuesday, June 2, 2009

Forex Trading made easy(ier). Have you seen the flourishing Forex Traders at every Bank, every Airport and even in most Malls? How do they do it? IT Systems and support. You too can use these excellent systems to operate you Forex Trading account or begin to explore the world of foreign exchange trading before making a commitment. I have researched AGM Trading to find all the answers to facilitate your entry into this lucrative market. This is what AGM Trading have to say:

“The Forex market is open 24 hours a day, 5 days a week. Because of the decentralized clearing of trades and overlap of major markets in Asia, London and the United States, the market remains open and liquid throughout the day and overnight. The Foreign Exchange Market is the most liquid market in the world eclipsing all others. In comparative terms daily volumes are more than 40x the Dow Jones Index.”

How to enter this enormous market? Let’s look at the offerings below.

Rolling Contracts and Daily Cash and Future Contracts have a ‘flow chart’ listing the currencies of the USA, UK and Europe and comparable value to each other. Point’s changes vary from second to second. The ‘spot rate’ can be compared from the time of your entry into the market, to the time you decide to sell, establishing exactly the profit you have made over that time span. Even small percentage gains add up to enormous profits on a weekly or monthly basis.

Have a look at the Specimen Market Information Sheets provided by AGM trading and sign up for a free demonstration. You have everything to gain.

The beauty about Forex Trading is that you can do it from the comfort of your own living room. In fact, you can trade currency anywhere in the world! The Forex Market is the easiest way to start a business that needs no staff, no stock, no inventory, no rent and no theft. All you need is trading capital and the right trading platform.

AGM Trading is even giving you starting capital to help you develop as a Forex Trading member. Take advantage of this one time offer with a free demo account and start up Forex trading money before AGM Trading take it off the table.

Financial & Investment Workshops, ebooks & financial freedom @

Contracts for difference with Forex

CFD(Contracts for difference) trading is about ‘margin trading’, or buying not ownership of stock but ‘trading rights’ on the stock by putting down a fraction of the price (i.e.,10%) holding it for short term, hours, days or weeks, and selling it at a profit when the market rises.

Easy? Yes and no. The cautionary is that like all speculation with stocks and shares, only money that you ‘can afford to lose’ should be used. Having said that, with the right systems, good nerves and attention, it is very feasible to make a lot of money. A CFD being a ‘derivative’ of a stock holding is a separate entity from Forex which can also be traded in the same manner but has some regulatory differences.

“For example, A client wants to purchase £10,000 worth of HSBC shares, the margin requirement would be only £1,000. If HSBC share value increases to £10,500 a £500 profit on the deal would equate to just 5% return if you traded the shares outright; compared to a return of 50% on a CFD.”

Interested? You should be. Get started now with a free ‘demo’ account from AGM trader. I've tried their charts and they are pretty damn hot. The benefit here is that you open your account in US dollars which means you can take advantage of the recent strength of the Rand.

Financial & Investment Workshops, ebooks & financial freedom @

Contracts for Difference

Stock exchange volatility has caused havoc on the world markets. Is a another crash inevitable? Not so say the experts. Lessons have been learnt from previous episodes in the last century, albeit a bit late. Governments around the world have rallied to shore up the markets, tighten regulations, and curb unjustified bonuses. Renewed confidence in the markets can be to the advantage of the shrewd investor who has a long term, or even a short term view.

CFD’s (Contracts for difference) offer excellent short term profits compared to long term share holding at much reduced risk. How does it work?

While the world’s traders and investors reel under the shocking losses, AGM trader has come up with a risk averse, innovative way to handle your money and make fortunes in the present volatile market.

Follow the details in the follow up posts to come as we look into CFDs and Forex. AGM Trader has come up with an innovative way to help beginner traders to get started in the game of trading. What has AGM Trader done?

Financial & Investment Workshops, ebooks & financial freedom @

Tuesday, May 19, 2009

Stock Market Bull Rages

It's been a while after my blog break. I was focusing on helping to put together a stock market course for people interested in learning how to do this actively. I guess that's why you found this blog... To search and seek out more knowledge about investing!

Well, the Integrated Trading System we have been working on includes global fundamentals and combines them with local stock market sectors and charts them so that technical analysis on a sector and share level is quite unique. We get a very high hit rate on our stock trading using this integrated stock market course approach.

I have also been spending a good deal of time overhauling my other business venture's website: beekeeping equipment supplies! That's right. I supply any beekeeper with the equipment they need to get started and grow their golden opportunity. The site hadn't been updated for a good long time and this month it got tagged.

The beautiful thing about beekeeping is that it can be the ultimate alternative investment opportunity. You see, it's a low cost, low capital setup and the bees do pretty much all the work... It's a sweet deal with all that honey and all. Bees are great.

I reworked all of the keywords and the links within the site and even added a new beginner beekeeping course. If you looking for something alternative for investing beekeeping could be it.

This week th emarket had a great rally. A fantastic turn yesterday on the ALSI 60 min chart gave an entry long at 19600 and after the gap up this morning gave 500 pts for the taking. That's the total weekly quota I set myself in less than 48 hours.

The Anglo American trade also triggered long from 19200 yesterday and closed today at 20800 at resistance there. Anglogold Ashanti gave a sinister short term trade this morning at 31500 to 29500 for a decent day's work.

Our integrated Stock Trading approach warned us that last week's sell of was a pullback buy opportunity and we looked to buy shares like Old mutual, Aspen and Sasol amongst the short list which produced a massive 10% on average across the portfolio in just 2 days! DO you agree that this is profits worthy of short term trading?

After today the Johannesburg stock market has once again resounded it's bullish rage and charged in a red-eyed flurry to break resistance levels confirming what we have been saying for months now: The bear market is over. The bulls are preparing to charge again. Buy on pullbacks unless critical support levels are broken on global fundamental charts!!!

Well, it's really good to be back!

Financial & Investment Workshops, ebooks & financial freedom @

Sunday, April 19, 2009

Stock Market going ahead

Market Outlook
Week starting 20th April

RESI or Resources Index Outlook

A lopsided Evening star candle formation confirmed by red candle presents itself on the chart of the resources sector. We also have a descending triangle as well with a break down level target of 36800. With the short-term trading range has been between 36800 – 41400 which the trader should take note of in order to benefit from support and resistance levels within a 5 – 15 day trading period.

The medium term range has been 43000 – 33400 which is vital to note when looking at a medium term trading period of 2- 3 months.

These ranges can assist you to make decisions either for the medium term or for the short term. The current descending triangle forms part of the short term trade and will test the break down to the downside which could take us to the low range level back to 33400. The level at 36800 needs to be broken before the medium term range low of 33400 can be challenged.

The 89ma is acting as resistance currently. It would need to remain intact. The Stoch indicator is displaying oversold levels but could still move down. Caution should be taken at this point. Confirmation that short term negative momentum is still in play is the reverse negative divergence on the RSI and Stoch 3 indicators.

Based on this I am short in Anglo American at 18750. Implats should've been short as well from 17350 with a possible profit target of 15300 but first 16300 needs to be broken.


The resistance at 19500 level is strong. The Financial and Industrial index just bounced off the level and formed an evening star with 18900 as a first support level. The weekly and daily chart suggests short term negative movement with a support level at 18625 and then 18292.

A fair deal of reverse negative (hidden) divergence can be found on the FINDI which suggests negative momentum coming into the sectors over the coming week.

The weekly chart does indicate overbought levels in the short however the medium term indicates continuation of the trend to the upside with the potential for a target level at 21500 est.

SP500 Index Outlook

Sp500 is trading above the 89ma with resistance at 876 level and the support at 89ma which is 843 level. Other levels of support at 824 and 813 respectively. The weekly chart shows that the index is very overbought in the short-term where a 61% retracement would result in a 747 target.

Gold seems to have found support at $867. Keep an eye on Anglo Gold at 26900 support level. If this level breaks down then we could have another down movement in the share. If not however, we could see a return to 28000 and even 30000 which needs to be supported by the move in the dollar price of gold as well as the weakening in the dollar.


Evening star plus confirmation. Support broken at 20ema Stoch and RSI showing more negative movement either to 18851 or 18675. Last support is 18630 level.

None of the information in this blog is to be used as financial advice but to be treated as educational in nature. We cannot give advice. It is my hope that you can learn from my experience and knowledge.

If you want more knowledge and practical experience then consider coming on my May Stock Market workshop in Johannesburg. It is for investors already in the market that aim to achieve short term profits as well as improve their medium andlong term investment returns.

Financial & Investment Workshops, ebooks & financial freedom @

Friday, March 27, 2009

Implats short and Standard Bank short

What an excellent close to the month and the week. It is my view that the last Friday of the month is profit taking day. The reason? The traders need to pay bills. They need to close their positions generally speaking in order to cover their monthly expenses and start again in the new month. It also gives them the chance to spend some of the hard earned profits... It's tough being a trader you know!

Both the Resources 20 index and the Findi 30 index were way overbought from Wednesday but the market was still riding on the back of a major rally. The question really for next week is whether this rally was a bullish comeback or bearish rally? Some homework needs to be done over the weekend! Look out for my post about this on Monday!

But both the Resi 20 and the Findi 30 were overbought using the stochastic indicator as well as old highs. It was a matter of waiting for the trigger and the turn in the market. Did it turn!! Today the majority of the market has dropped down by around 5% in those sectors or indices.

Personally I was short Implats from 17252 yesterday and held it through to this afternoon for a fantastic profit. I was also going to short Standard bank, ABSA, First rand and Anglo American yesterday however I had a car licence renewal queue to deal with. This took me 3 and a half hours to secure. I find out I also need a roadworthy test as I am transfering the car into a trust.

Then the All Share Top 40 index signalled a short from 13h00 at 19500 which resulted in 500 pts of profit per contract!! The last two days on the stock market have made me a small fortune. I certainly cover my monthly expenses in just 2 days of short term trading.

Learn to use the moving averages and the stochasic with the RSI as your main indicators on the technical side... but it is vital for you to also understand the psychology of the market by using resistance and support lines and comparing global indices with your local ones and then sectors to shares etc.

I will be lecturing at a Derivatives workshop tomorrow. I need to go and prepare for that now. It is all about the theory of how the different instruments work and how you can take advantage of them to gear yourself and your portfolio.

Have a great weekend! For more info on short term trading visit

Financial & Investment Workshops, ebooks & financial freedom @

Wednesday, March 25, 2009

Another Alsi 40 trade and market run

What a great day on the JSE!!

(I have neglected to post for a week and I owe my apologies. I'm working on a personal mentorship programme for people interested in learning from the very basic investment level to advanced day trading involving futures and ALSI which will take place over three months. Drop me a line if you have some ideas on this!)

The stock market had run so hard over the last 10 days that it was time for it to take a breather. Tuesday and most of today constituted that breather in the short term.

Besides the short trade from this morning which I missed as I was attending to a large beekeeping goods order. I also run a full time beekeeping equipment supply business. While I was getting my weekly prescription of manual labour packing out the order of bee hives, beeswax and queen excluders I was not at my computer.

There was a grand 200 odd pts trading there for the taking this morning in the ALSI 40 short trade. Then the market started to move sideways for a couple of hours.

So, as I worked on my personal investing & trading mentorship programme, I kept a beady eye on the ALSI. I noticed a swing change and challenge of the 89e happened but failed. The moving average worked as support confirmed by the stochastic. Check 1 confirmed!

An hour or so later I look again and there it is! The signal to go long on the ALL Share Top 40! Around 14h30 it gave the signal with the best entry price being around 19300 but waiting for one more confirmation meant watching with baited breath until 19360 with a stop at 19330.

I went long after 15h20 and then added again about 15 min later. This price was around 19410. My target was 19535 which was a resistance level during the live chart yesterday. The SNP500 and Dow Futures were up stronger and our ALSI took off. It wasn't long and my take protif was hit... in fact it was less than 20 min and I was out of the trade.

The trade still went on to 19670 odd after that. This would've added an additional 100 odd pts to my total for the day but I ain't complaining! Besides by adding to the position as it went up I effectively doubled some of the points I did make due to the additional leverage I was using... In essence I got like an extra 80 pts when I added more contracts to the position.

Good trade nonetheless! And the market closed quite well considering its opening...

Financial, Trading Stocks & Investment Workshops, ebooks & financial freedom @

Tuesday, March 17, 2009

ALSI 40 and 400 points today!

ALSI 40 with 400 points today! Absolutely fantastic!

The market was look overbought since yesterday. It proved to be a call worth waiting for. The gap on the open of thursday last week was an exhaustive gap meaning that the move was losing momentum.

The 60 min and 15 min chart were saying the same thing from early this morning at 9h45 you should've been short from around 18030 and should still be short. for just over 400 pts right now. The low for the ALSI 40 today was 17490...

The end of day chart shows the 18200 level was the major resistance and that we could expect a number of days to the downside to follow. The trade short could be open until the end of the week even. It would need to be monitored of course.

One should've added to theposition at around 17710 to the short in order to gain from continued downside for the after session. This would have created an additional 200 pts for you on the second position which should be closed now to secure profits.

With the RESI and Findi both taking a hammering it was a matter of time before the ALSi top 40 gave way to the negative movement. Remember the Alsi Top 40 is made up of financials and resources shares in the main. If both take a pounding then you can be sure the ALSI will follow.

The market outlook for the rest of the week is quite negative. The futures close out happens on Thursday which forces all short sellers to buy back their shares. One can roll over to the June contract but this incurs a small amount of costs of 0.25% of the exposed position.

Generally, if you are taking any trades between now and Thursday be sure to ask for the June contract. Also NOTE: there is articificial buying pressure in our market currently due to the closing of short positions.

The same can occur at the end of the month when the Unit Trusts all close their books for quarterly reports. They tend to push the shares up in the last week of the quarter to improve their quarterly performance. Be aware of this too.

We also looked to short Anglogold and Anglo American and Standarad Bank today which have all gone smooth in the negative sentiment on the day!

Do you want to learn how to make money when the share prices are dropping? It's called shorting! Learn how you can make money in bad markets!

Financial & Investment Workshops, ebooks & financial freedom @

Monday, March 16, 2009

Trading Alsi 40 index

From the 10th of March trading at around 16520 one was long on the 60 min chart and closed out at 17300 on the 11th laste for a whopping 800 pts in 24 hours trading ALSI 40 index.

Then a falling wedge formation starts to develop and it consolidates for most of the 12th and then breaks the upper trend line of the falling wedge at 16h00 on the 12th to go long again with an ALSI 40 target of 600 points from the 17200. Gives us a top end target on the ALSI 40 index of 17800 odd. We happened to break 18000 and are now battling at this level. Lots of resistance.

Today there were two very neat trades using the 15 min chart. Go long at around 12h00 today from 17900 to 18145 which is excellent. Followed by another trade short on ALSI 40 at 16h15 18870 down to the 50ema 17945 for another good number of points.

For more info on ALSI 40 trading visit the ALSI Top 40 Apprentice...

Financial & Investment Workshops, ebooks & financial freedom @

Thursday, March 12, 2009

ALSI was good yesterday - Mixed today!

Well, the Findi absolutely flew yesterday with many signals triggering a rally to test the 17000 level again. Similarly the General retailers, Resources 20 and Snp500.

The ALSI respected this positive move by surrending just over 200 pts in a wonderful break out trade yesterday from 16992 to 17205 level with about another 150 points to spare as well... It topped out at 17350 in the 1st half session around 13h00.

It did present a short of about 100 pts shortly after that using a 5 min chart with a tight stop loss. Another positive divergence gave an entry long at 17235 to close out 100 pts later at the double top type formation. That was the day's trading...

I however only managed to get the 1st half session trade as I went to the JSE exhibit to meet some people.

Today there was a range of very tight numbers between 17100 and and 17150 for most of the morning. We had a break out at just after 10h00 with FTSE opening. this didn't last long however. It went to 17250 so there were 100 pts in it.

My platform's connection failed when I wanted to enter at 17210. Got in after that and then my stop loss kicked in on the pulled back to 17150 again. the hammer following the support at 17150 was good entry point and just about made my stop loss back.

Now we have a new range: 17150 to 17250. Interestingly 17250 is where we closed yesterday on the doji on 5 min candle chart.

Overall the 60 min chart tells me to expect some downside... The sectors are telling me a different story however yet they are based on end of day analysis. Assessing the ALSI eod it still looks good for the upside.

Effectively, on the end of day swing trade you should be long from 16200 and still holding. A possible target of 17535 is in the offering end of day.

Watch SNp500 with quite a positive candle pattern which has now been confirmed called morning star.

Watch Kumba for a possible rally by the end of the week. Copper also should rally leading the move in Kumba. Stop loss at 13790c which from the morning open is a 200c stop loss. The potential target to the upside is 15150c. It would also be good to see Anglo American and Billiton move up as well.

Right now Kumba is not a buy. But a prospective buy. The double top on Kumba suggests down side to 13200c first before it could rally. the range has been drawn with the top side being 17500c and the low end being 13000c. We are still inside the range but not at either extreme.

The 120 min chart suggests a turn by the end of today an a target of 15600c. The 60 min chart is very close to a buy. With a high risk tolerance one could take a punt on it with a stop loss a 13790c which would be around 350c at the price at the time of writing. Preferably, the entry should've been this morning at 14070c odd, if not lower. The support level is 14005c and for a really tight trade one could enter now with the risk you get taken out during the day due to volitility but then find Kumba closes up for the day.

Grindrod is closed as at yesterday when it reached my upper target above 1300c. Great short term trade!

Off to JSE open day again. Trade well! Not often. Come to our investor's club meeting in April!

Financial & Investment Workshops, ebooks & financial freedom @

Tuesday, March 10, 2009

ALSI Update and Trade

Mixed morning ALSI Session

It took a while and much discipline to wait for this morning's ALSI trade.After waiting 2 hours for a set up that gave me a signal on my strategy, it finally presented itself.

We went long at 10h35 at 16518 level and closed for almost 100 points as the ALSI went to the top level of our morning range. The range was sitting between 16500 and 16600 for quite a while. It took the positive opening of the FTSE as well as support from strong trading on the SNP and DOW as well to push our stock market to the upside.

Overall market outlook for today is that we may see a pullback again in DRD GOLD which would be mainly fuelled by the gap it left at 887c. In addition to this possible downside also consider that there is a double-top setting up at 950c with a neckline at 767c which gives us a 180c (estimated) target to the downside if the neckline is broken.

Once again, my recommendation in this instance is to keep track of gold and silver. One can refer especially to the New Gold ETF in order to analyse the chart for a view on gold's position.

Grindrod has defied all the stock markets odds and went positive from our call at 1126c last week we have seen it go to 1220c which is not far from our 106c target. In essence, this amount does warrant closing if you are edgy about the market today. Considering the move by the FTSE after it's open one may speculate that JSE will look to the upside. One would do well to consider that a sell on Grindrod today could be a fairly good move considering the overall market sentiment is in negative territory.

To give you an idea of the short term trade on GND last week this is how it reads:

  • We call a long end of last week to enter at 1126c in the morning wih a stop loss level set at 1100c straight but utmost stop loss of 1080c due to the overall negativity of the market on Friday morning's open.
  • Based on the price of the share we would calculate that we would trade with 30 contracts which gives us an exposure to 3000 shares for only 15% of the capital required, if you decided to trade the shares instead of using single stock futures to trade.
  • So, if a contract price is R120 per 100 shares (there are 100 shares in each contract) I would have used only R3 600 plus brokerage in order to purchase 3000 x R11.26 = R33 780 worth of shares.
  • I sell my Grindrod shares at R12.20 which gives me a gross profit of 94c which is the same as if you had bought the shares.
  • We take the 3000 shares x 94c = R2 820 gross profit less brokerage of about R600 in total (estimated at higher end).
  • I make R2 820 using R3 600 which is 78% return.
  • As a share trader or someone using shares to trade on the short term you would have used R33 780 to make R2820 nett.
  • That is equivalent to just over 8% using the full capital instead of leveraging your capital.

Moral of the story? Learn how to trade with your capital and make it stretch using leverage!

BUT IT'S RISKY!! Ask the right questions! If Grindrod went to 1100c and we both had to close the trade due to the stop loss kicking in, what would we have both lost?

  1. In your example, the share lost 26c from 1126c to 1100c. Right? Take your 3000 shares x -26c = -R780 (loss) plus your transaction costs ie brokerage.
  2. In my example, the futures contract lost 26c as well. Take my 3000 shares or 30 contracts x -26c = -R780 (loss) plus my transaction costs.
  3. What's the difference? Not much! Right? Yes, I am!
  4. Is there more risk in trading futures?
  5. NOPE!

The risk only comes in when you overexpose yourself. If you are not aware of how leverage and margin works then you could get yourself into trouble. One should never, in general terms, leverage more than three times your portfolio size.

If your portfolio size if R50 000 you shouldn't leverage your trades to a value of more than R150 000. Effectively, you are controlling your leverage by keeping the margin you put on the table low.

You see, you could get leverage of 10 times on your account. This means that with R50 000 in your portfolio you could trade up to R500 000 worth of shares using a single stock futures. Don't go there...

Instead, come learn how to trade ALSI, Futures, Forex with us.

Financial & Investment Workshops, ebooks & financial freedom @

Monday, March 9, 2009

Alsi & Market update

After a fun-filled afternoon on Friday with our market rallying after the US unemployment figures came out, it was a great way to end the week!

The SNP 500 closed down below the critical 700 level as I discussed it could last week. This bodes well if you can short the local stock market. It doesn't give me a warm fuzzy feeling about our local rally or bounce right now except for one thing: Resources.

The ALSI created a bullish engulfing candle formation at the close on Friday. This gives some impetus to the weak going forward being bullish. There is also positive divergence on the stochastic.

The trouble is that the ALSI is made up of the financials and resources. The financials are being hit pretty hard and so if the resources don't rally hard the ALSI could take a tumble.

The Resources opened fairly negative this morning with DRD gold being a star performer again last week seconded by Anglo Gold and Anglo American. Silver has the potential to trigger a falling wedge formation and therefore suggests further upside in gold this week.

After the gap in DRD however I suspect it may be exhausted. We may see a retest to the old high of 950c before it goes to close the gap at 887c. Be aware that the candle chart is showing a potential double top formation on DRD.

Grindrod, is certainly making a go of it. As we discussed late last week, the chart was looking very oversold. The assessment was to look to buy it at 1126c with a stop loss at 1100c and at worst case 1080c. This is with a view to take a short term trading profit of around 106c and a swing trade profit in equities at say 1303c. Note that this trade is against the overall trend as Grindrod is below its 89 moving average.

Yes and so it happened. The market fell out of bed from 9h45 with a great 200 point drop on the ALSI. I grabbed 160 of them and that's why the delay in this post this morning... I went short at 9h45 and was out at 10h10.

We are holding an investor's club meeting tomorrow night at Wanderer's Sports Club. You're invited to come along. Visit for more info.

Our Financials & Industrials index is falling like a hard rock in a big pond. This combined with the fallign resources will cause havoc on our local stock market - at least for the Monday morning session.

Resources seem to be following suit after the Financials heading south. Anglo Gold and DRD seem to be holding out as well as Grindrod. Watch these shares this week. Kumba opened way down today and is probably following a drop in copper prices. This will have an effect on Billiton, Anglo American, Metorex and other copper miners.

Trade well, not often.

Financial & Investment Workshops, ebooks & financial freedom @

Thursday, March 5, 2009

Anglo American & Alsi Update

Yesterday was eventful.

We had the US unemployent come out and it was pretty bad. Worse than expected. So our market and many others went for a bath...

We went long in the morning for 150 odd points which was amazing and our long position in Anglo American hit target and peaked out at 15100. We took profit at 14921c which is a round figure profit of R13 per share using single stock future contracts x 3. This means we had 3 contracts x 100 shares per contract. Brokerage is about R600 give or take depending on who you are trading with...

So our profit there is R13 x 300 less brokerage of R600 which gives us a total nett of R3900 - R600 = R3300. Not too shabby for a 2 day trade.

The ALSI gave up over 400 pts yesterday using the day trader trend indicator I was able to take the long, then a short as well as another long in the afternoon. The last long was at 16h25 at 16430 and out at 16685 for just over 200 pts. The volatility in the market can really benefit one if you are able to ascertain the trend intraday but also to gather swing points using various trading techniques.

We went long this morning with the resistance being 16454 end of day as well as 16450 intraday. As the market opened this moved to 16430 which is our top resistance. I closed at 16411. We opened at 16368 for 40 odd pts. Which pays for lunch.

Now the market is range bound stuck between 16420 and 16270 and could be traded within this range perhaps one more time. It does depend on the FTSE open. We may see a break of 16420/430 to the upside however the general end of day trend is bearish....

There is the opportunity that the market will swing depending on the FTSE open. This will signal a chase to close the gap at open. that gives us a target of 16470, followed by 16531, 16651/685 to the upside.

Watch DRD again and ANG as safe haven investors take refuge in the gold shares again...

Keep an eye on Grindrod as at 1100c it is quite oversold. 976c is ultimate support for the share with the next few weeks going forward we could see it head there to test it. However the short term over the next few days we could see a bounce with support at 1100c. A stop loss at 1100c would be more than sufficient for a reward of 106c per share to a max of 1311c from its current level of 1126c.

We broke 16450 and traded again going long keeping a ratchet stop loss at our resistance level now support at 16531.

Good trading.

Financial & Investment Workshops, ebooks & financial freedom @ &

Wednesday, March 4, 2009

ALSI Top 40 is Tops today!

The ALSI Update

What a fantastic day on the ALSI. I wasn't able to enter the trade on the ALSI at the open and hence saw the index run away from me for most of the morning session. The support of 16071 held and played its part perfectly.

The Fibonacci also confirmed the support with it being at the level of 161% extension to the downside from the previous high end of day. The other short term indicators also confirmed that the market was very oversold on the 60 min as well as end of day.

So, patiently I wait for my entry trigger with support of 16060 as stop loss main. My live chart's main support is 16125 with a resistance level of 16681. The 60 min has told me I can go in but the 15 min chart has jumped the gun and doesn't give an entry until 11:00.

Go long at 16618 and close it at 16763. Swing the trade to the downside from 16737 in a short trade to close 16557. This trade is followed by another long at around 15h35 at 16595 to close out at 16685. That is business done for the day.

In total we are talking 145 +180 + 90 points which equals 415 for the day!
That makes up 80% of my week's target in a single day. In a case like this it's best to go play golf tomorrow.

And the overall trend was certainly weak and the retracement or bounce in the market was expected this week as discussed in my newsletter. The newsletter is available by visiting Investor Newsletter which is a Free weekly Market Outlook.

Pretty much all of the sectors were screaming for a bounce otherwise known as a retracement after a move into an extreme situation. Resources, Financial & Industrials, as well as the General Retailers all were primed to do the same thing. The set up was ready and wound. It just needed to be released.

What was going to have the effect of releasing the hounds of the bounce? It could well do with the Chinese Rescue Package coming out later this week. With the Chinese economy being resuscitated it could be the driver the commodities need in order to rally for an upswing over a few weeks, perhaps days but it would be short term.

Our call on the Anglo American trade in our investor newsletter and on the blog earlier this week gave us a late entry yesterday afternoon but at the lastest for end of day buyers to get in first thing this morning. Our entry was yesterday afternoon at R136 with the view to take between 8-10%. This is the structure of my trading plan. I do suspect that the swing could be carried forward until Friday unless the US closes down before then.

So Anglo American pretty much met my trading plan target when it hit R147 and some change intraday. I also use LIVE charts to time entries as well as exits from the market.

Both Kumba and Implats were on our radar as well this week. But have you seen the drop in Grindrod? over 20% in this week alone. It is usually one of my shares to follow. This time round it left me behind. I will ensure that I am looking for the retracement there as well. When it moves it goes for quite a distance before momentum is lost.

Good trading today. Do you want to learn more? Come on the ALSI Apprentice programme.

The real question to be tackled is, whether this rally could be the market turn around point for the stock markets going foward? Some work needs to be done on this topic. Catch you next time...

Financial & Investment Workshops, ebooks & financial freedom @

Monday, March 2, 2009

ALSI Update

Since the original negative outlook on the ALSI 40 since 16th Feb, we have had a fall of another 1900 points. The 16191 level is old support from Nov 08. This level was broken this morning as the gap on the open raced passed this level to 16071 before bouncing from this level to challenge the gap.

The 60 min outlook on the ALSI is a recovery to 16430 level as resistance but first the gap must be closed at 16494.

With my next Fib level being 16700, how close did the ALSI get to that before turning south. The short triggered now at 17h15 has reaped 200 pts and ought to be closed about now.

Gold recovered well today with AngloGold up 3% and DRD both up after the pull back. That was great. Anglo American is very oversold and indicators imply that the share could experience a retracement/bounce with R134 being a fair support level. The upside target later this week is around R154.

Both Kumba and Implats had sterling days on the market clsing up 7% and 9% up respectively.

Keep an eye out for our new Forex Mentorship

Financial & Investment Workshops, ebooks & financial freedom @

Wednesday, February 25, 2009

ALSI Update

Right well the ALSI has continued on its downward trend after trying to test the 17800 level on Monday.

The end of day outlook on my chart for the week is still playing the negative card. The Stochastic and RSI indicators on the short term are signalling an oversold position on the ALSI at the moment.

16871 is the nearest support level and if this is broken we should see a retest to the level before the market breaks down in earnest.

The support of the Monday and Tuesday trades now become the resistance of the rest of the week unless broken. This is the 17231 level.

Be wary at this level as many of the main sectors and indices have broken down through their most recent support levels which until this week had been fairly robust. There may well be a retest of these support levels -now resistance- but be aware not to be caught out thinking that this is a new rally...

It is likely, in my opinion, that we will test the old support levels - now resistance - before heading south again. But the trick here is to wait for the market to tell us where it is going.

But it is important to watch resources and financials sectors to get a better indication of the ALSI's direction. When both Fini and Resi are finding the same direction, then the ALSI rockets....

Just bear in mind that the end of day chart is in oversold territory.

Financial & Investment Workshops, ebooks & financial freedom @

Sunday, February 22, 2009

ALSI & Market Outlook

ALSI & Market Outlook

I just finished downloading the data from Friday's stock market close. What a turn of events. It looked as if the market was going to be depressed and close down badly in the red. The along comes the gold sector and platinum sector which was having none of it.

In essence, the ALSI regained its losses for the day and eventually went right back to close the gap left when it opened in the morning. The gap down was significant. The stock market was red everywhere!

It just so happened that I got just over 100 points around mid morning which was followed by another 200 points late in the afternoon if I had been at my pc. I had a client to meet about a particular strategy he had heard about and wanted to discuss it over with me. I happened to be in Rivonia at the time the trigger happened. Such is life.

It just so happens that looking at the Resources Index, a.k.a the RESI, the market certainly looked to be heading further south. Considering however how the gold and platinum sectors closed off our resources heavy top 40 index swung in the late afternoon.

Many safe haven investors taking to the apparent refuge of gold and other precious metals like platinum with the aim of protecting their capital. Both Anglo Gold and DRD Gold have made new highs as discussed they might last week. Platinum is looking strong to test the R150 resistance if it can break above the old resistance of R145 which it closed on Friday afternoon.

Considering the ALSI end of day chart, there could well be a swing come Monday morning depending on the close of USA on the Dow and SNP. It doesn't look good right now as both of them made new lows. It would be worth a look at the FTSE. We could well look for some confirmation from the movement Monday morning when the FTSE opens.

The ALSI end of day chart does indicate very oversold position with stoch and rsi below 30 and 10 respectfully. Immediate resistance is at the close of 17681 with support at 17160. We could find ourselves challenging 18071 if the open is positive and the market swings bullish.

The low oversold levels on the indicators imply a 200-300 upside in the morning but again lends itself to the sentiment of the US close which was negative. One may like to look at the Asian open to confirm our direction until FTSE opens.

I would consider the LIVE charts as well and seeing as though we closed up on my LIVE charts I conclude that 17426 is 1st level support followed by ultimate support at 17210. 17844 seems a strong resistance level too on the upside.

It certainly warrants waiting for after the open to assess again the market sentiment. Bearing in mind that the end of day chart on the short term indicates a retracement with the medium term still implying probability of downside after a short pull back.

Keep an eye on AngloGold and DRD gold. Anglo American is heading into oversold position as well. and has broken recent support levels. But it may require another 2-3 days before it retraces briefly.

On closer look into DRDGold, the share does look overbought now. It is displaying a well known reversal pattern on a candlestick chart called a Morning Star. It closed on Friday with an upside hammer. There certainlys seems to be strong support at just below 900c.

DRD's old high of around 971c to 989c is set to be the strong resistance. The share's momentum may well fall off here and we may find it having a small retracement back to 692c and find support there again. It is vital to trace the movement in GOLD using the NewGold ETF as a precursor to how DRDgold and other gold derivative shares will perform.

We may only see a slight retracement of 23% to 789c before the momentum in the gold price forces the share onwards and upwards. Likewise with AngloGold. on DRD gold 875c is quite an important support level and would signal that the retracement is in play with potential to move to 789c.

It certainly pays to get access to good training regarding your trading.

Financial & Investment Workshops, ebooks & financial freedom @ ,

Wednesday, February 18, 2009

ALSI Trade today

Today the ALSI had an interesting move.

We had positive divergence on the Stochastic plus the stochastic was very low. The ALSI was also sitting on my fib line and support. Despite the fact the overall stock market was saying down, the ALSI managed a short but very quick rally to the next Fib level.

I was in the trade from 18067 going long with a price target of around 100 pts according to my assessment. I cut back 10 pts as I set a stop profit order on my trading system as I was going to be leaving soon and couldn't watch the screen. My trade closed out at 18157 automatically for me.

This is a 90 point trade on the ALSI in the morning session. Following that trade the market then swiftly did an about turn for a short which is playing out.

At 12 noon, the trigger came for the change again and we are in short from 18020 and are about to bank my short profits at 17785. This is a total of about 300 points for the day on the ALSI. Only 200 pts short of my weekly target in one day.

Using my combination of indicators and time zone map it is possible to trade for a nett of 100 points on the ALSI most days. How much does this work out to be in profit terms?

Profit depends on your instrument and your gearing. If you were using CFDs or Spreads you can trade with much smaller amounts of money in margin and therefore take a lower gearing. So on Spreads, your margin requirement for R1 spread trade is R1200. In essence, this means you could get R10 spread bet at R12000 which means every point the ALSI moves in your favour after costs you make R10.

If you are using ALSI via SAFEX as a future index then you need R21 000 margin for 1 future's contract which enables you to either make or lose R10 per point as well.

Say in my example above of my trade this morning I took a R1 Spread bet on the ALSI going up in price. I am required to provide R1200 in margin or refundable deposit in order to facilitate the transaction.

I enter the trade and close it with 90 points difference between the entry and exit in my favour (18157 - 18067 = 90). In the example on spreads above I make 90 x R1.00 which gives us R90 after costs.

What is my return? I had to allocate a refundable deposit of R1200 to take the trade. I made R90 on the trade after costs.
So we take R90 (R1 x 90) / R1200
= 0.75 x 100
= 7.5 % return
So you don't think R90 is worth it per day? Well, remember the beauty of the derivative market is that you can now trade R2 per point relative to your account and the margin required. For every additional R1 you want to bet per point going in your favour, you need R1200 in your account.
Lets look at another example now using R5 per point:
R5 per point x 90pts / 5 x R1200 (deposit required)
= 0.75 x 100
= 7.5 % return

It's the same?!! How does that happen. Because the required deposit is relative to the size of your trade in terms of R1 per point. However, you have now made R450 in the same trade but you needed R6000 margin to do it.

It is quite possible to trade 15 days a month on good, high probability trades. My kind of trade... and make 100 pts each time. But then what about when you get it wrong. Well, that happens too. It's part of the game. Don't fight it! It will be like trying to air... you can't possibly win.

Ok so let's look at it this way: You trade 20 times in a month. Out of those 25% are bad or go the wrong way. We end up with 5 bad trades and 15 good trades. If we make our stop loss 100 pts that equals:

5 bad trades @ 100 pts
= 500 pts lost
15 good trades @ 100 pts minimum
(win more pts than you lose)
= 1500 pts
Monthly total
=1500 less 500
= 1000 pts
1000 x R1 = R1000 p/m
1000 x R5 = R5000 p/m
and so it can go on.
How much can one start off with? Well the real question should be, "How does one ensure a great start - not a false one?" By ensuring that you have a good trading system or know how to build one for yourself and back test it!
Well, I must get ready for the next position trade in my time zone map. Catch you next time!

Financial & Investment Workshops, ebooks & financial freedom @ Now featuring the ALSI Apprentice package!

GOLD ~ The winning sector

Many moons ago I learnt a really powerful yet simple equity methodology for determining the performance of the different sectors against the market. I do this because I want to know where the money is. Whose money you ask?

The Fund Managers and the Institutes money is key to really making decent money in the stock market. One could follow what the fund managers are doing after the fact and buy what they buy. I prefer to pick it up from the market itself. Generally speaking, the fund managers can't dump hundreds of millions on the market all in one day.

After learning this great skill, albeit simple, I am able to track down the Big Daddy money out there. Once I have done that I go over the sectors with a fine tooth comb to find the shares within those sectors that are the best performers somewhat hand-picked to be on the fund managers team. Those left behind after all the slots are taken get a seat on the bench and don't get to score.

The Gold Index signalled a recent buy in the week of the 16th-23rd of January 2009. Some of the gold mining shares have doubled in less than 2 months. Is it time to get in there now? Not likely. Chances are you have missed the boat. Better not to chase it now...

DRD Gold and Anglogold signalled on my Big Daddy Money system in December already. DRDGold triggered around the 2nd week of December at around 435c and is now over 800c. AngloGold has gone from around R200 to over R300 this week.

But I will be waiting to add to my investment positions as there could well be a pull back or retracement before the gold shares move onwards again. But I will be keeping an eye on it like a hawk.

DRD has been the best performer with Anglogold following closely behind. Some less traded shares like Afgold and GBG Gold also have had some really good moves.

Keep an eye out for our next post about the Yield X on the bonds. Do you own a homeloan? Well, as the debt cycle peaks and the interest rate committee begins to waver under the economic pressures of a debt-laden consumer you could bank money as the interest rate drops off.

Look out for that as we develop some more info on that topic.

Financial & Investment Workshops, ebooks & financial freedom @ Check out our NEW ALSI Apprentice!

Thursday, February 5, 2009

Interest Rate Announcement

The MPC or monetary policy committee meeting today is 1 week early due to conflict with the budget speech next week...

What does a drop in rates mean for the stock market? Well, for one it should allow fundamentally more spending by the consumer. This frees up monies otherwise tied up in servicing the high debt level the consumer is burdened with.

Generally, banks and retailers benefit quite a bit from a rate cut. But the overal economy will benefit here to because of the heightened debt burden.

Keep an eye on the banks and the general retailers. As I write this post the market is turning green on my screen! The power of the interest rate...

Financial & Investment Workshops, ebooks & financial freedom @

Wednesday, January 28, 2009

Update on JSE All Share Index

Update on the JSE All Share

We have been trading a fantastic long on the market this week especially in Gold and gold shares. But the general market also referred to as the All Share Index, has had a significant week of upside.

How did we become aware of the move in the market over the last week? We use our technical analysis of local and some international stock markets. We get an overview of the local stock market using different fundamental and technical indicators. For instance, our position on GOLD from last week was to buy from around the $840 mark and to sell at $880 this week.

Buy understanding some chart patterns, in particular the ascending triangle pattern, we could plot an expected target of $140 possible upside to the Gold price once the gold price broke above $830 last week. This also triggered our positions in gold shares like GoldFields and AngloGold from Monday this week. We have since closed our positions yesterday as we saw on our short analysis that Gold could pull back slightly, likely due to profit taking. So we moved our money off the table as well.

ALSI End of Day Report: we are at the 21 day EMA and we have resistance at 19360 on our LIVE 15 min chart. There is also a double top pattern formation on the ALSI live at the moment which suggests some downside after the nice bull rally we have experienced.

The MACD is about to cross down as well on a LIVE chart with the Stochastic 13 also looking very overbought. All of these types of indicators suggest some sell off in the ALSI 40 index today and tomorrow.

Fundamentally speaking however, the CPI and PPI are being anounced in South Africa this week. CPI was very positive yesterday which will add comfort to the market going higher. Once the interest rate cut which is said to follow next week, this will inflate the local JSE market to the upside.

Keep an eye on Sasol as it may have a pull back to around 26500c over the next few days. Obviously keeping an eye on Brent Crude oil would be a good idea at this point. Well, we keep an eye on it at any point when it concerns our position on Sasol. The two are very much linked to each other.

For more info on learning to assess the market the way we do... go visit and We have also put together a free basic tutorial about money and investing.

Financial & Investment Workshops, ebooks & financial freedom @

Thursday, January 15, 2009

The JSE for 2009 and the Rising Wedge NOW

The South African market has triggered the rising wedge, on the end of day chart, which has now played out to show the market will be heading down again for a few days. It has already started doing so. The benefit of knowing how to take advantage of this using Short Term Trading strategies we can make good profits by short-selling the market.

On the Futures Mentorship I run, we shorted (expected the price to go down) both Implats and Billiton earlier this week. We have made over R6000 in Implats since Tuesday using just over R7000. As far as the stock market is concerned, one can still look and find opportunities using our successful strategies! On Billiton we made good money as well.

Shoprite, as the superb example, was brought to my client's URGENT attention during my workshop in the last HALF of 2008! By putting together the Equity Strategies and tieing them with Equity Fundamentals, we assessed the market and Shoprite was undoubtedly the best performing share across the market at the time! In fact, it still is. But I know you value our input and enjoy benefiting from our outlook on the market so I believe that you could find value again in the rest of this letter...

I ran through the market with our Equity Trading Strategies process and Shoprite came up TOPS! Then since August 2008 a BUY triggered in Shoprite at around 4200c and there has been no signal to Sell the share. The share price was 5400c yesterday at closing. This is after 114 days for a 27% return! Why wouldn't you want to achieve those kind of returns, especially considering the bearish market at the moment?

To get the right education on investing and trading, look at the people teaching you the strategies that they use themselves. Strategies that make them money. Lecturers that trade the market. We also love to train and teach others to do the same. Come grow your knowledge. Grow your portfolio account! Achieve your financial goals.
Here's wishing you the best financially profitable year ahead!

Financial & Investment Workshops, ebooks & financial freedom @

Monday, January 12, 2009

Focus For 2009 & Ahead!

Welcome to 2009! Great to have you on board for the trip.

This year I plan to focus on bringing you many more posts and indepth insight into my trading style, personality, concerns and stresses as well as triumphs and tribulations!

I am lookign to focus on the following instruments in 2009:

  • ALSI40 - South African top 40 index using Spread tradin instrument
  • Certain shares within the top 40 of the South African local market with a focus on the RESI sector (Resources, mining)
  • Forex trading - looking at EU/$ over 4 hours and daily chart

So, if you have any questions on any of these give me a shout! I have noticed that the JSE-All Share index has made higher lows as well as break up through the 89 day moving average. This could be a signifcant event for our local market in the short term as it suggests a possible bullish rally after a short test of the 89 simple moving average ("SMA").

This event could trigger a bullish rally for the first quarter of 2009. Which means I could be finding myself in the equity market again on my first choice stock watch list. I did unfortunately miss some very profitable entries over the December period while taking a break... But such is trading. Besides, for the equity market I prefer to buy and hold so my timing needs to be in tune with the economy to a certain extent fundamentally speaking.

For the long term investments I certainly consider the economic cycle as well as global fundamentals before making a decision to enter a trade. On the short term trading side of my business, I focus less on the fundamentals and more on the technical analysis.

My aim tin 2009 is to describe my findings, experiences and outlook on the markets as a whole and then pin point certain trades I take and then elaborate on why I took them!

Come join me on a branch of the Trading Money Tree!

Financial & Investment Workshops, ebooks & financial freedom @

Over 400 PIPs on Forex

Over the holidays, I take a break from my staple traing environment due to the low volumes. Remember, everyone is away on leave and so not many traders especially the fund managers and banks are trading the market actively. This does not bode so well for the local market as our liquidity suffers quite heavily. I rather take the opportunity that everyone else does and go on a trading holiday... except this year I decided to look into Forex.

Why Forex? Well aside from looking at Dave's Forex Breakout system discussed on an earlier post, I find that forex doesnt suffer the lack of volumes during the festive season when compared to any other market worldwide. So, I was back on the trading platform albeit for just a couple of weeks at the end of my vacation...

What did I discover? Well, that Dave was right all along. The Forex is the cleanest market I have ever traded. Amazing to see first hand how the different candle and chart patterns I use all the time to trade my ALSI and other stocks using Futures and Spread trading intruments worked even better on Forex! I was stunned!

So, I opened a demo account as the people I wanted to open an account with were closed... Not to worry I am LIVE now. But suffice to say what a pleasure trading Forex! The software platform is free from your broker. The transaction costs are the lowest I have ever found to exist on any instrument unless it's free. The risk management side is fantastic as ther eis literally 0% slippage on your stop losses and take profit levels.

So, I did some trades! I sold the Euro against the Pound as well as the Euro Vs $ on the 31st December and closed both positions on the 6th January for just over 400 Pips per position! What strategy did I use? A simple negative divergence trigger on the Day1 chart in conjunction with a 4 hourly chart. Both of these position hit my Fibonacci extension targets which was great!

I am currently selling the Euro vs $ again and watching the trade carefully. I will keep you informed about the trade!

Financial & Investment Workshops, ebooks & financial freedom @

Predicting the Market with 80% Confidence?

Can financial markets be predicted with an 80 confidence rate?

The amount of cash produced in a trading environment is a function of the hit rate achieved and the risk to reward ratio. In a batch of 10 trades with a hit rate of 50% and a risk to reward ratio of 2:1 the trader would make 0.50c profit per Rand risked. This is a sure way to making lots of money, supposing that the trader can stick to the system through the long runs of bad trades.

It’s a mathematical fact that with a 50/50 system there are 3 bad trades every 8 trades taken. Four bad trades every sixteen. Can you handle a run of 4 bad trades?How will you feel after 4 bad trades in sequence? Will you be able to execute the next without hesitation?

Although a high hit rate is Not necessary to make money it’s normally necessary to allow the trader to play the game of trading emotionally. Let me explain. In a 50/50 system four bad trades come up regularly every 16 trades. In a 66/33 system four bad trades happen every 81 trades. In an 80/20 system four bad trades take place every 625 trades. Most of us could handle a run of four every 625 trades but every 16?

How can we get our hit rate up to 80%? Firstly if we wish to trade with a high hit rate then it’s important to realize that we won’t be trading every move of he market. I always say in my seminars that it’s like only going out with girls that look like Halle Berry; you don’t do that much dating.

Secondly we need to look at technical measures of the market which are unconnected mathematically. For example a candle pattern which occurs over 3 days is unconnected to an ascending triangle which forms over several weeks. When both occur simultaneously our prediction of the future goes up significantly in probability.

In a seminar lasting from 0900 to 1400 I have put together many high probability trading setups. The seminar is aimed at those people (most of us) who need a high hit rate from their trading to make the game of trading stocks enjoyable. The latter are prepared to sacrifice many of the trades which are marginal and wait for the pearls of opportunity to come along.

Welcome to 2009! Come back to the Planet cos we have some serious work to do this year!

Financial & Investment Workshops, ebooks & financial freedom @