Determine the Entry and Exit Point of KepCorp

A reader of my book, "Infinite Wealth", inquire about my view of Process #2 for KepCorp, a Singaporean stock.


Well, my first assumption is that he/she  has completed Process #1 and qualified KepCorp as a good investment candidate for further study. 

Next, I compile all required information in Process #2 and would like to summarize my view as follow:

1. Based on the summary table from Process #2, it can be clearly seen that majority indicators show “BUY” signal.
2. Do note that the gap between 20SMA and 50SMA is getting closer and less steeper.  This could happened only when prices have been moving rather flat for quite some time.  This is also supported by narrow Resistance and Support Price Level, which is only $0.15.  In other words, the price can easily dip below 50SMA at any time.
3. Current price is slightly above Resistance Price Level with retreating market volume may means that the price might meet some resistance for moving ahead.  Therefore, risks of entering KepCorp now is considered very high.
4. For the time being, the low risk entry price should be placed at $8.95, the Support Price Level.  However, I suggest to put only a portion of your fund allocation at this price level as the risk for KrpCorp to retreat to $8.65 is still high.  In other words, be ready to get out of position if the price dip below$8.95.

You may feel that rather depress for high possibility on making loss within such an extreme short period.  Do not blame to yourself and accept the fact that the market is really so unpredictable. 

However, there is still a way to overcome this.  When you see the trend of 20SMA and 50SMA are moving side way or less steeper, the best strategy is to do nothing until the trend tells you strong signal on whether it is going up or down.  The reason is very simple.  Side moving or less steep SMAs show no trend.  It can go up or down later on.  The best trend of making money from share market is when SMAs are moving upwards steeply.  The steeper upward the trend, the more impressive return will be.   

Please note that the above is for discussion and educational purpose only.  Do refer to my disclaimer in this blog and my book.


Good luck.