#191. Stock Charts And Tea Leaves

Why Is A Stock Chart As Important As Tea Leaves?


When we want to build a house, we start with a blueprint. This blueprint will help us to plan the dimension of the house. The rooms. The internal piping and wiring system that are invisible to us. The materials needed. And so on.


With a blueprint, it will be clear to us what we want to achieve in the final results of the house.

Once the house is built, some people would consult a fengshui practitioner. The fengshui practitioner will draw up a flying star chart or an 8-mansion chart. He might also consult his xuankong dagua charts, the qimendunjia charts and so on. However, one thing that is never missing from him is the luopan or the fengshui compass.

Without a compass, a fengshui practitioner cannot practice fengshui. Without a blueprint, a house builder cannot build a house.


Now that the building is completed, the owner wants to tell people how to get to his place. A tourist need to have a map to know where the place is.


Without a map, it's hard to drive to the place. Without maps, compass and the stars, the ancient sailors could not navigate their ships successfully.



What I am trying to emphasize here is that in each work and trade, people need to start with plans. I am sure you have heard of "If you fail to plan, you plan to fail."

The surgeon studies the x-ray and MRI scan carefully before attempting any surgery.


With a map, we can be more confident on reaching the place where we want to go.


With an MRI scan, the doctors and surgeons can be more confident in their treatment for the patients.


Of course then, only with reading a stock chart carefully that we can make a more calculated risk when investing. That is why we have many stock charting softwares available in the market.

Don't you think studying a chart is important in unit trust investment? With today's modern stock charting software, we are able to pull up some indicators quickly and make more informed decisions on when to buy and sell.


Some people even specialize in analyzing Japanese candlestick charts to identify the right time to buy and sell.


Learn the art of studying the charts if you are serious in investment.




Back in early January 2009 I showed you the above chart in article #153, KLCI Chart And Elliot Wave. KLCI closed at 894 on 2 January 2009.

Below is the chart as on 13 November 2009. KLCI closed at 1271.




Those that have invested according to the right timing, and the knowledge can only be obtained from studying the chart, would have made a tidy profit (42% increase).


Ever heard of people reading tea leaves to predict the future? To them, the leaves are as the charts to the smart unit trust investor.


If you want to know where the price is going (future), study the trend on the charts (or read the tea leaves).


Do you or your unit trust agents use charts to time your buying and selling?