some technical comments - positive, page-28

Sorry I haven't yet written before now (in reply to earlier Friday posts); I've been on the road. It's now just after 6 on Saturday morning and my partner and I are staying with friends in mountain country for the weekend.

For Luckyman_99: Thanks for your compliment. I appreciated it. But the expression of your thanks acts as a catalyst to let me be expansive for a moment. As you know, I look at the markets mostly from a TA perspective. My strong suit is not FA. BUT, there are dozens of posters who do FA really well. The ones who scratch around the reports, the announcements, the numbers, et cetera, - they help make sense of the relevant information that we can use. Some merely express opinions, while others dig around and give us the facts. I've written on this thread that I employ TA, but most cheerfully do so on the back of a good story. I DON'T invest in companies with no cash, no ground, and no hope. Nor do I throw dollars into companies where the people running the show might have less than favourable reputations.

I'm a better trader because of the posters who CAN DO FA - study it, make sense of it and write it all down for us to use. So, in turn, thanks to them.

For TonyIndo: Tony, I'm wary of being too clever with my charts. There are some programmes that have over 100 indicators. Too complicated; it's possible that using too many of them can have you start sounding like those economists who declare that the market is going to go up and it's going to go down - all in the same breath. In other words, it's possible to have your charts tell you anything.

That's why I prefer the simplest possible approach to have them help me understand what the buyers and sellers are doing. The message should be as sharp and as clearly defined as possible.

All that said, to answer your question ...

A friend of mine (let's call him Charles) who has been a very successful trader for over 30 years (as in multi-millionaire through the markets) once told me that, if he was allowed to use only one indicator, the one he would choose above all others would be an ascending triangle. And there's a beauty forming right now with BKP. Just draw a line joining the bottom prices from the 23rd of December up until it intersects a horizontal line drawn at 2.4 cents. Share prices rarely fall out the bottom of those; they usually break upwards - and that's what Charlie likes - the 'break'.

As to timing, the intersection of those two lines is about eight to 10 weeks away, but we know from FA that BKP has some news about a spud which will most assuredly come well before then. I think that we are all assuming that the SP will rise on that announcement. However, Charlie's break will be in force if the SP closes sometime at 2.5cps or above. I have some spare set aside and will add to my holding when that happens. "Buy the break" has long been Charlie's motto.

Will it get to 3? I don't know. In the film, Lawrence of Arabia, an Arab in Lawrence's party while crossing a vast and mercilessly hot and dry sand-plain falls off his camel. His absence is not noted until they reach the other side late in the afternoon. Lawrence prepares to retrace their steps to rescue him, because the man will surely die from heatstroke and dehydration. One of the more senior Arab leaders tries to prevail upon Lawrence not to go, "He will die. It is written." Lawrence replies emphatically, "NOTHING is written."

I wrote in my post on this thread on the 2nd of June, "If I draw a horizontal line at that level (meaning 3 cents) then the SP is likely to head towards it." We need the buyers, and the signs are good. At the Friday close 196 buyers are staring across the fence at 137 sellers. They want 179 million shares, and the sellers are only willing to part with 79 million of them. The 'force' is with the buyers, so, while careful to echo Lawrence's words, I'm (like so many of us) optimistic.

For Upmarket: Appreciated your thoughts (and smiled a bit, too), and, yup, I've missed a few multi-baggers - MBs (bought and sold AMX in the 30s for a profit - they topped out at $3.42 on the final day of last year). Regrets? - to quote Sinatra, "I've had a few!" But I've also picked up a few. Some responses:

1. EVERY multi-bagger is a multi-bagger only AFTER they've become a multi-bagger. If you can tell me right now - before it happens - that BKP is absolutely going to be a multi-bagger I'll sell the house, the car, the dog (even the photograph of dear old Aunt Harriett) and dump the proceeds into BKP Monday morning. Wouldn't we all? Nothing is written!
2. Before the stratospheric climbs begin that often characterise MBs there's usually some SP movement - perhaps indicative movement. With judicious trading it's possible to develop a free-carried parcel that you can leave there for the long term. (That may be all very well as a sound strategy, but if I have a 'trader' fault it is that I'm either in a stock or out of it. I find it seriously hard to have a part holding.)
3. Re #2: there have been times when I've held a stock that "I'm gonna hold! This thing's going to the moon." Then, the SP drops, hits a stop-loss level and my system (read: 'preserve your capital' - the mantra intoned by all the great traders) kicks in and I sell. I can honestly say that I've made MUCH more money using stop-losses, than when I used to try and hold.
4. I don't take your 'No guts, no glory' statement as you having a shot at me. It's a valid line, and - in general - I agree with its meaning. "Who dares, wins" is the S.A.S. variation. But 'idiot guts' which may be defined as the gung-ho danger-seeking variety rarely leads to glory. It's the element that gets people nominated for Darwin awards. The gutsiest people I know take a seriously professional approach to risk management (I have a partial background in motorsport) and they are the ones who most commonly reap glory from gutsy performance. You don't know me, BTW, and - as a result - you have no idea how many times in my life I've totally 'laid it on the line.' Risk has been a common-place part of my life for years.
5. Finally, on a practical note, I trade for a living and haul money out of the market from time-to-time to pay the bills. I need the fluidity.

From #4, Upmarket; you wrote, "Like your post sticks but it ain't me." That great commodities and futures trader, Larry Williams, apparently counsels people to trade using wide margins, saying that they''ll make more money if they do. Just recently, hearing that for the first time, I tried for a while to do that. I set a 25 per cent stop loss (I usually use 5-10% - very tight). I discovered that 'to quote you, " ... it ain't me." We all have to find our own trading style.

One more thing: You confessed that some of your stocks decreased in SP by 50 per cent before the FA turned them round. A stop loss might have had you winding up with nearly double your original holding.

For Jonnee: "TA can't predict oil strikes, guys." You're right! I agree with you! But FA doesn't do buyers, sellers, and timing.

That'll do. Time to go and get the Saturday papers - The Australian, The Age and The Fin. Tea and time to enjoy them. Joy!!

Good luck to us all. No black swans!!

(Stops in place, always.)

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