USD uptrend again

Debt in USD = headache again
Sales in USD = additional gain

SCH - the change of wind

My 5 simple steps will lead me to simple but effective value investing. My way to minimise the risk and maximise the gain.

Step 1: Check the PNL. Profit? Potential turnaround to profit?

Aim the bull: SCH business is trading quarry machine and equipment. Last year due to stonger USD and GST impact, the sales seriously affected. However, the company still able to maintain profitable.

Score : 1 due to still profit despite business slow down.

Step 2: Check the cash flow. Where is the money generate? Where is the money go?

Aim the bull: Cash and debt about equally same. But still able to pay dividend.

Score: 0 due to not a net cash company.

Step 3: Check the Balance Sheet. Is it only left the shit (e.g debt)? Cash status? Retained earnings for potential bonus issue? NTA vs price? Fair value vs price vs NTA?

Aim the bull: Manageable debt but risk of cash flow if business continuely no improvement. High retain earning but partly offset by merger deficit.

Score: 0 risk of debt default if business continue slow down

Step 4: Check the price status? Which wave? Uptrend? Downtrend? Consolidation? At peak? Measurement of margin of safety?

Aim the bull: Price still at bottom level, no sign of recover. If you noticed the history movement, it will rebound after touching 0.20.

Score: 1 due to better margin of safety.

Step 5: How is the outlook of the existing business and any potential sales pipeline?

Aim the bull: Below is my outlook which will lead to better performance or turnaround:
1. Stronger MYR able to import machine and equipment at better price.
2. GST impact slowly realignment to demand.
3. Mega infrastructure projects kick off soon e.g. Pan Borneo and MRT 2 projects will lead to higher demand of capital and operating spending for quarry operators.

Score: 1 due to "wind will change"

If score 1 or 2 points...forget it
If score 3 points...monitor closely
If score 4 points...collect slowly
If score 5 points...full force...sai lang

Overall 3 points...the risk is the wind still stay no change i.e. USD continue rise up and slow implementation of the mega infrastructure project.

RGB - breaking the wall soon

Feeling the wall is going to break soon, may the force with u...

A&M - healthy correction; HIL - "heavy correction" with small volume

A&M - still within uptrend line.

HIL - Away from uptrend line, see whether it can restore back or not. The volume bring down the price very small, therefore it might be a wrong signal.

RGB - at where you look at it?

In the chart, there is a hidden or invisible line you need to feel for it. How to feel it is determine by at where you fee it. The line aim the bull described in 3 simple term.

1. Uptrend line (a buy )

2. Down trend line ( a sell )

3. Flat line ( monitor )

From the mountain (5 years chart), actually you can see RGB is moving at uptrend line with big swing gap. Now is at bottom 0.16. The next new high aim the bull forecasted above 0.20 - 0.25 as to move along the uptrend line, this has to be created. If not the uptrend line is game over. 

With recent good financial performance and expected coming good result, yes, my feeling it is will likely to happen. In term of margin of safety, yes, I am not buying at peak but at bottom as I feel.

If you standing on the ground (3 months chart), you will only see a piece of picture (a flat line movement) but not a full picture. Therefore, where is your standing to view is a key of success.

The invisible line only able to detected if you standing on the top of mountain. I am not asking you to climb up mountain and take a look. :). So, go up and feel it the fresh air and nice big picture with aim the bull... imaging it.

Stock movement = Human nature

There is nothing new on Wall Street or in stock speculation. What has happened in the past will happen again, and again and again. This is because human nature does not change, and it is human emotion, solidly built into human nature, that always gets in the way of human intelligence.
"Of this I am sure."
-Jesse Livermore

This is explained why stock movement pattern can be detected with your TA and FA skill and most important your "feeling". What you need is a simple trend analysis, able to understand simple financial data, and most important based on your reading how you feel it, feel good, feel risky, feel high chance, feel must buy, feel must let go now... your feeling will be your final decision.

This will a "basic" to enter a buy or sell, even you make a wrong decision, you will still happy with it as this is your decision. Also, you learned from mistake, your own the mistake, and willing to accept it.

No need to attend expensive workshop, just follow aim the bull 5 steps. :)

Human Mind...

Compass vs clock - which one u choose to be?

Compass - i use compass as a symbol to mark the financial data to remind that the direction where to go is most important. You know where to go then you will stick to it. If the basic no change, still strong, you will not act silly when price go against your expectation temporary.

Clock - more apply to contra, just reflect to what is happening now, u just do and do, you don't have direction, just react accordingly. Want faster settle it, as fast as possible. End up dont know what is doing and tired.