assessing trend strength · enough to frighten any serious investor or trader. one market report...

December 14th 2019 A publication of Algobot Pte Ltd CRN201604500D. Copyright © 2019

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Weekly for Saturday December 14th, 2019. Based on Thursday’s Close

CONTENTS

ASSESSING TREND STRENGTH pg1 READERS QUESTIONS: COACHING OR TIPPING? pg9 SHORT TRADE PATTERN CHANGE pg13

TRADE MANAGEMENT FOR CHRISTMAS BONUS pg15 NEWSLETTER OUTLOOK: THE A B C D OF THE MARKET pg19

PORTFOLIO CASE STUDIES: MONEY MANAGEMENT pg21

ASSESSING TREND STRENGTH By Daryl Guppy

We wish al readers a Merry Christmas and a very prosperous New Year.


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ASSESSING TREND STRENGTH Traders and investors do not change over time. The questions they ask remain

much the same. I was reminded of this with a question from a person who attended

one of my recent workshops in Melbourne. He asked if a stock that was making new highs was likely to continue rising.

Irrespective of the stock, the same analysis methods are applied. We use GMMA trend analysis.

Applied to this chart extract the question becomes “ Is it safe to enter on this

rebound given that this stock has recently retreated from historical highs? We apply GMMA analysis.

The long term GMMA is well separated showing a strong trend.

The short term GMMA has moved down but has found support at the lower edge of the long term GMMA.

The current rebound rally has bounced away strongly from the GMMA support level.

This is a good opportunity to enter a strong trend at a point of temporary

weakness. So, let’s look at this same stock a few months later where it is again making

new highs and the developed a pullback.


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Applied to this chart extract the question again becomes “ Is it safe to enter on

this rebound given that this stock has recently retreated from historical highs? We apply GMMA analysis.

The long term GMMA has compressed but is now turning up

The short term GMMA has moved down but has now moved above the upper edge of the long term GMMA

This is a good opportunity to enter a continuation of an established trend at a point of temporary weakness.

So, let’s look at this same stock a few months later where it is again making

new highs and the developed a pullback.


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Applied to this chart extract the question becomes “ Is it safe to enter on this rebound given that this stock has recently retreated from historical highs? We apply GMMA analysis.

The long term GMMA is well separated showing a strong trend. The short term GMMA has moved down but has found support at the

lower edge of the long term GMMA. The current rebound rally has bounced away strongly from the GMMA

support level. This is a good opportunity to enter a strong trend at a point of temporary

weakness.

Repetitive analysis, isn’t it? That’s the key to consistent analysis. New highs are irrelevant., What is important is analysis of trend strength which provides an

assessment of the probability of the trend continuing. The previous examples were all CSL on a weekly chart with the first entry near $68. This gives a current 300% plus return.

Traders can choose to wait for a price retracement prior to making an entry, or they can enter at any point in the existing uptrend at points of minor trend weakness.

MUMBO JUMBO TECHNICAL ANALYSIS

Perhaps I am looking in the wrong places, but I keep on seeing technical

analysis of charts that is little better than mumbo jumbo. Commentary designed to look informed, but so complex and filled with conditionalities that it is virtually

meaningless.


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Or, as the example shows below, charts where even basic trend lines are plotted incorrectly, and essential chart patterns ignored. This is analysis provided by a finance professional, so its inaccuracy is even more concerning.

Heres the trend line rule. A trend line starts at a peak anchor point and touches at least two other peak points. The line shows a change in trend behaviour is triggered when prices moves above the value of the line. This is a primary entry

signal, usually confirmed with other analysis methods. On the chart extract the trend line shown is incorrect. It touches just two

points. More importantly it ignores the peak levels A, B and C which are correctly used to anchor the correctly placed trend line.

Does this matter?

You bet it does. Acting on the correctly drawn trend line already gives and entry signal and a profitable trade. The incorrectly drawn trend line triggers an entry

condition well after the new uptrend has developed.’ Additionally, the correctly drawn trend line gives early warning of the trend

change by highlighting the changing nature of trend activity. The line switches from a

resistance function to a support function. When the line acts as a support feature the nature of trade management changes.

The red lines show our analysis. First is the change in the nature of the trend line from a resistance feature to a support feature. Second is the development of a double bottom.

This allows the trader to calculate an upside target. These two features allow the trader to enter the rebound rally early and carry the trade to the suggested

target. If you cannot get the basics of technical analysis correct, then no amount of

mumbo jumbo will allow you to become a successful trader.

NEXT NEWSLETTER

This is the final newsletter for 2019. The next newsletter will be January 18, 2020.


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You can download the ATR indicator for MT4 at https://www.mql5.com/en/market/product/29683 Use this to improve your trade risk

management.

CASE STUDY EQUITY CURVE

The case study WBC Cfd trade is closed for a profit of $1215 or 12.13%. The

case study portfolio return is $51,665 or 51.66% for the period starting July 1, 2019 and ending June 30, 2020.

For the year starting July 1, 2018 – 2019 the case study portfolio return is $91,794 or 91.79%.

For the year starting July 1, 2017-2018, the case study portfolio return is

$115,330 or 115.3%. For the year starting July 1, 2016-2017, the case study portfolio return is $92,464.15 or 92.5%. For the year starting July 1, 2015- 2016, the

case study portfolio return is $156,450 or 156.45%. Equity trade size is generally kept constant at $20,000 in the case study

portfolio so it is easier to compare the case study trades over this and other years.

Unless otherwise noted in the trade management notes, all equity case study trades are managed on an end of day basis, with the exit taken at the best reasonable price

on the day after the stop loss is triggered. Warrant and CFD trades are generally kept constant at $10,000. Warrant and

CFD trades are closed on an intraday basis using a guaranteed stop loss as this is a

primary method of managing derivative risk. FX trades are generally kept constant at $5000. Stops are managed intraday.

This capital allocation reflects the risk in each of these asset classes.

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READERS QUESTIONS: COACHING OR TIPPING? By Daryl Guppy

The difference between coaching and tipping is important. The beginner knows

he does not know much, so it is tempting to buy a weekly publication that purports to provide a list of stocks to buy. Some may be published by obscure groups or

organizations, while others a published by well known identifies. In all cases, the tip sheet provides buying, and sometimes, selling, advice. Generally the reasons for buying are rarely explained. You are asked to accept the decision based on the

experience and reputation of the tip sheet sponsor. Or, you are encouraged to accept that the buy recommendations are the result of some specialist technical technique.

Parts of this may be revealed, but readers can never be entirely certain how the final buy recommendation is made. Any technical based search it likely to turn up 10 to 20 potential trading candidates. Unless we know why one candidate was selected in

preference to the other nine we can never learn how to emulate these decisions. Tip sheets do not teach. Traders learn nothing useful from them. In many

cases, all they learn is bad habits, particularly when it comes to handling the inevitable trading errors.

Tip sheets are in the business of publishing and marketing. The financial market is their chosen field, but it could just as easily be horse racing, property development, or Tupperware. These are harsh comments, but an extended and serious examination

of tip sheets provides the evidence. From a coaching perspective, understanding how to handle trading errors is

vital for survival. From a marketing perspective, errors in stock selections are a negative. Readers want tips that work, which is why they buy the newsletter. Advertising highlights how many tips the newsletter got right, and the dramatic

returns on selected trades. It makes for good advertising and increases circulation. Unfortunately it bears little relation to the real world of trading.

Tip mistakes – stocks that go down instead of up – are quietly ignored and very rarely discussed in detail again in the tip sheet. Publishers are able to do this because the churn rate of subscribers is high, and the attention span of readers is short.

Readers want the next hot tip and are not interested in the losers. Give it twelve months, and many subscribers will have stopped reading the tip sheet because they

have run out of money to trade with. It is easy to lose the losers behind the hype of a few winners. This approach also matches the way many new traders approach their own portfolio performance. They ignore AMP they purchased at $14.00 and focus on

a stock which has just put on 15% over the last 3 days.


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Here is a performance reality check with examples culled from several tipping

services. Take the time to do the same by listing the buy recommendations from a tip service and then matching them with sell tips for the same stocks. The results are enough to frighten any serious investor or trader.

One market report recommended the purchase of a mining stock. The market report did not ever issue a sell advice – not even when it was clear that the stock was

going to be delisted! This 100% loss was not included in portfolio accounting. Another market report recommended a media share at $0.75. Two weeks later the trend collapsed and the stock is currently trading at $0.10. No sell advice has been issued to

date. One market report recommended a stock to readers at $0.90 and still has

readers holding when the trend collapsed to $0.64 after a clear trend peak at $1.00! This report suggested that weak, cowardly or nervous readers could get out of the trade at around $0.70 if they wished. However, it inferred in its commentary,

courageous and successful investors would hold onto the stock because it was going to climb back even higher than $1.00! Eleven months after the peak, these readers

are still waiting for the hot tip to tell them when to sell at a profit over $1.00. Current trading price is still $0.20 below the original recommended buy price. Often these failures are quietly dropped from any portfolio progress report.

The common thread with these type of tip sheets is that there is no concept of stop loss selling to protect capital or protect profits. Put this another way. There is NO

RISK CONTROL because the success of the tip sheet rests on its ability to get the tips right. They are not interested in teaching their readership how to trade, perhaps because much of their income comes from magazine and newsletter sales.

Tips are for waiters. Tip sheets are for fools, not traders.


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A good coach, or coaching newsletter should spend as much time analyzing their losers as they do analyzing their winners. A coach explains how he reached his

conclusions. He demonstrates how decisions were made. He examines ways the decision could be improved.

The coach concentrates on risk control – on what to do when things go wrong. He recognizes that failure is part of the game. Trades that fail are recognized and accurately accounted for in any portfolio report. The coach demonstrates in advance

how he intends to manage the trade, how his stop loss is structured and why he has chosen one particular method rather than another.

The coach analyses every trade for ways to make it better. He develops a clear trading plan that first sets the conditions of selection, entry and exit. The final aspect

of the plan is how much return the trade could make. To stay at the top of his game, champion golfer, Tiger Woods employs several

coaches. He has a coach for his golf swing. He has a putting coach. He does not have

a tip sheet. How do you get a coach? There are three ways.

Hire a personal trading coach and be prepared to pay for his time and expertise. It has taken him many years to learn this skill so it will not be available for a pittance. Coaches are selective in who they will take on,

and how many people they will deal with. Attend workshops. These may be general trading workshops, or

workshops on specific techniques. This will not be free or under $100. Seminars at these price levels are a marketing hook to attract customers who are potential clients for very expensive trading programs, systems

or products. If you want genuine coaching in a real workshop environment where you are expected to learn how to trade by yourself

then expect to pay between $200 and $2,000. The presenters trading experience did not come for free, and he will not give it away for free.


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Subscribe to a teaching or coaching newsletter or magazine. In terms of magazines, Active Trader, Technical Analysis of Stocks and Commodities offer teaching resources. They do not discuss current

individual buy and sell opportunities. They focus of exploring techniques and tools. Tutorials in Applied Technical Analysis is one of the very

few coaching newsletters available worldwide. It provides the opportunity to look over my shoulder, and the shoulders of other traders, as we find, assess, select and manage different types of trading

opportunities in current market environments. We know many people do not have the time or discipline to explore and apply different trading

techniques so the newsletter provides a way to properly explore these ideas. This is not individual coaching, but the insights into the reality of trading are as close to coaching as you can get in a newsletter format.

Most of our income is derived from trading the market – not from newsletters.

New traders starting out on the path to part time, or full time trading should

read, read, and read. Follow up areas of interest with specific reading. This is the

cheapest part of any market education. Then explore the ideas with paper trading to see how they work, and if they work for you. The market has many opportunities.

Some are more complex than others. We do not have to follow every opportunity. However, it is useful to know what is available before we make a selection about what

suits us. The newsletter is an ongoing smorgasbord of techniques and opportunities. New traders start small and part time. Apply just one technique on paper.

When it has worked successfully several times, then think about taking a single trade

using the technique. Build on successes, and make sure that the inevitable failures do limited damage.

You did not get to your current career position in a single bound. Nor will you get to be a full time trader in a single bound. Every success, no matter how small, is important. Concentrate on the return on capital and real money will follow. Long term,

part time trading to supplement your income offers a good compromise solution. Don’t dismiss it out of hand.

INDEPENDENT ANALYSIS

Trading and investment analysis should be objective. One of the strengths of

charting and technical analysis is that it uses an objective set of figures – price activity – which are readily available to everybody interested in the market. How

individual traders choose to apply and interpret those techniques is a matter of subjectivity.

The fundamental analysis relies on figures created by the company in annual

reports and press releases. He works with figures generated by outsiders, such as auditors and accountants. He also works with figures derived by others for particular

purposes. For instance, if the analyst works for a brokerage involved in an IPO launch then the figures are often a little brighter than market reality would suggest. The application of fundamental analysis is a subjective process from the very start

because very few of the figures used can be independently verified. Even the balance sheet is a carefully massaged document.

A significant problem for traders and investors who rely on the research and analysis of others is the objectivity of the research, and recommendations. When a research company is being paid for a company to do the work then it is not

uncommon for the report to put the best possible gloss on the situation. When a brokerage is preparing a report on a company, and it is also handling trading work for

the same company, then the same constraints apply.


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The result is that few sell recommendations are produced by the analysis industry.

One of the advantages of this newsletter is that we are not tied to any

company. We receive no commissions from the purchase or sale of shares by readers, or the sale of any financial product used by readers, or from brokerage or industry

referrals. We do receive income from books and our other software products but these are quite independent of any material we cover in the newsletter. The analysis methods we use in the newsletter case studies are easily duplicated by readers using

objective price and volume information.

SHORT TRADE PATTERN CHANGE By Daryl Guppy

This is a pattern trade. Its built around continuing bad news for the underlying

stock – WBC* – but at heart it’s a pattern trade with an equilateral triangle. This pattern has changed. The breakout is to the downside, but the subsequent rally has

not invalidated the analysis. The upper edge of the equilateral triangle is extended an becomes a downtrend line. The price rally has used this downtrend line as a resistance level.

This gives two trade management solutions in this type of environment. The first is the target set by the initial pattern analysis.


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The base of the pattern is measured and projected downwards to give a target

near $23.63. This projection is measured from the point where the price moves below the trend line. The trade solution is built around these pattern price projections.

Second is the value of the downtrend line. A close above the downtrend line is an exit signal because it suggests the trend is changing.

The trade is closed when either of these exit conditions is reached. NOTE Friday the price closed above the trend line, signalling an exit. As the next

newsletter is not due until Jan 18 we have taken an indicative exit at the close. This delivers a $1,215 profit or 12.13%.

For tutorial purposes we have added a CFD trade in WBC* using this pattern. Entry is near $24.74. The upper edge of the triangle pattern is used as the stop loss.

The projected downside target is shown. This is an example of news based and pattern based trading.

*The image shows a saxophone player and a woman’s face.


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TRADE MANAGEMENT FOR CHRISTMAS BONUS By Daryl Guppy

Perhaps Santa might bring a bit of Christmas cheer with a very late Christmas

rally. Equally any presents may be snatched away early in the New Year whilst many of us are on holiday. The case study portfolio has one open position. Readers may

have more open positions. These are at risk as the market enter the liquidity drought over Christmas. Low volumes exaggerate market moves.

Going away on holiday exposes us to market risk because most times we cannot monitor our open positions daily. Personally I always take my laptop and work in the hotel while others sleep-in during the morning. The family still takes a dim view

of this! Before leaving for the Christmas break, traders should assess the reasonably best and worst outcomes from their current positions. If the risk outweighs the

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reward, then trades should be closed, particularly in short term volatile trades that have so far failed to work out as expected. If the reward is more attractive, then this can be locked in with pre-set sell orders.

The 2019 market remains somnolent so protecting open long side trades is less of a challenge. The newsletter case study portfolio will probably be flat over this

Christmas. We have one open position but we expect this to be closed before Christmas. However we know many readers will have open positions so these notes are for them. Whilst these notes are written for long-side traders, the same principles

are applied to open short side positions. If traders believe the market is likely to fall over Christmas, but not collapse,

they apply a trend based stop loss. They use a tight stop loss conditions at around the lower value of the short term group of moving averages. Perhaps this is at $7.60 using the chart examples below.

If traders believe the market is likely to slow over Christmas, but not collapse, they also apply a trend based stop loss. They accept that the Guppy multiple moving

average display confirms that this is a well established trend. While we may miss out on short term profits, it is unlikely that the trend will reverse rapidly into a downtrend. In this type of longer term trend trade, we place our stop loss just below the upper

value of the long term group of averages at $7.25. Traders who believe the market will develop strong up trending behavior use

the value of the long term group of averages. The stop loss is at the lower edge of the long term group of averages, $6.90.

Christmas/New year has several specific characteristics. The market tends to

trade with low volumes. Most people are thinking about holidays and are not involved in the market so just a few traders and trades can have a large impact on prices with

moves of 30% plus. This is particularly so with speculative and mid cap stocks, although surprisingly large impacts can occur with some of the heavy weights. This is a random impact, difficult to judge in advance, but when it comes it is sometimes a

holiday magic bonus that delivers a very pleasant Christmas present – or take it away.

Of course, the same volatility applies on the downside which is why setting a stop is essential.

Traders going on holiday who had placed a sell order above their intended

short term targets were rewarded. With speculative and mid range stocks there are advantages in placing sell orders on your very upper limits of expected price targets.

Prices may spike to these levels on reduced volume, and if your order is first in line you get to collect your Christmas bonus. Usually we apply this strategy to the open trade in the case study portfolio.


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This is a standby strategy. The Christmas kick appears in a handful of stocks. If you already hold the stock, you can be prepared for any kick up. It is not a strategy applied to stocks purchased prior to the Christmas break in anticipation of a Christmas

kick up because the distribution is too random. I find this a useful strategy with all my open trades over Christmas. Traders set a sell order towards the maximum end of my

expectations for the trade. Sometimes they are pleasantly rewarded. If prices do not reach this level, then they simply cancel the sell order when they return from holidays.

Christmas is often characterized by a reduction in volume and an increase in volatility. When fewer people are trading, there is an increased probability that a small

trade may have a significant impact on price. This is OK when it drives price up, but it creates a problem if it drives price down. This shows up as a drop below our stop loss level which takes place on just a handful of trades. Our stop is triggered, but then

prices recover quickly. We do not want to be shaken out of the trade as a result of a panic or accidental sale of just a few shares. This increase in low volume volatility

creates a problem in managing open trades. The solution depends on the intention of the trade. In a long term trend trade,

traders loosen the stop loss points. This is shown below. Remember they wait for a

clear end to the trend before taking action. For shorter term trades there is no really effective solution to this. However traders can apply a variation of range based stop

loss conditions which are adjusted to take into account the potential for increased volatility. The advantage is that the stop loss is lowered so that it is not triggered by

just a temporary dip on low volume. The disadvantage is that we cannot tell in advance if the dip is temporary or a genuine trading signal. By lowering the stop loss we increase the risk to the trade because the drop may be a true trend change.

The only effective solution is to either close the trade while you are on holidays, or to take the laptop with you.

These solutions work in the same way by doubling the range of the existing stop loss calculation. We use an old chart to illustrate the technique. We start with a

count back line calculation. This sets the stop loss at $1.11. If we use this stop loss level, then there is a danger that we will exit the trade as shown and miss out on the continuation of the trend. If we were sitting at home when this signal was created we

would verify it using a Guppy Multiple Moving Average and decide that the trend was


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still intact. Trouble is, we are sitting on a beach and we do not know what is happening.

The holiday count back line solution calls for a doubling of the percentage

difference used in the stop loss. We start with the calculation point for the CBL stop loss at $1.19. We calculate the percentage loss between this point and the count back

line stop loss at $1.11. This is a loss of –6.72% and is shown by the doubled headed arrow line %A. This value is then projected downwards from the stop loss line, as shown by the double headed arrow line %B. This sets a new holiday stop loss at

$1.04.

This holiday stop loss gives the stock room to move if there is unexpectedly

high volatility on low volume that would trigger a normal stop loss exit. I find this an effective method because the count back line calculation is based on the significant

volatility of the stock as defined by the three significant bars. The same principle is applied using an Average True Range calculation. Traders

using the ATR trading tool in GTE simply adjust the ATR value to 4xATR. This allows

for a doubling of volatility and is protection against low volume price temporary price dips.

In some charting programs the application is more complicated. The diagram illustrates the results when the 2xATR value when it is based on the closing price. Our concern is with unexpected volatility and this is more likely to be related to the low of

the day. Remember, we do not have the opportunity to see this chart action and make a decision. We are trying to set up the conditions that will protect our trade while we

cannot monitor it. We are on a very nice tropical island with no phone or internet contact.

This method takes the value of the 2xATR calculation and projects it from the low of the highest current bar in the trend. This value is then doubled, and projected downwards again. This sets the stop loss at $1.04. In this example the calculation

manages the volatility dip successfully. However, this method is less robust than the count back line approach because

it is based on a predetermined time period. The 2xATR calculation makes a prior decision about the time used in the calculation and this time remains constant no matter what happens in the market.


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Certainly close management of the trade is the preferred option, but realistically we know that many traders will go on holidays. If the trade looks very sound, such as a long term trend trade, then the trade is left in place. Other faster

moving trades are monitored with tighter stop loss conditions. The primary danger with the relationships shown in the chart sample is that the current bubble activity will

collapse. If this happens over the Christmas period it means we will miss out on the potential bonus profits from this trade. This can be overcome by setting a very high sell target. If it is taken out, it provides an unexpected bonus.

The floating stop loss is a variation on a trailing stop loss. It is designed to protect profits. The stop loss level is set as a % of the most recent highest high. The

choice of the % figure is up to the user and this makes the choice arbitrary and not directly related to market conditions. Popular choices include 5% and 10%. This is a stop loss technique automatically applied by some black box and grey box trading

systems. The floating stop loss calculated by hand for Metastock users. Any stop loss

technique is better than no stop loss technique, but the arbitrary nature of the floating % stop loss soon leads to dissatisfaction. It takes traders out of trades too early as the trend continues, or too late as the trend has already turned. This encourages

traders to adjust the % figure and the temptation is to do this while the trade is still open. Instead of building trading discipline this destroys it.

Better stop loss techniques are directly related to the volatility of price rather than just the value of price. They are also related to a wider money management

approach. Over Christmas, our trades are managed by using pre-set stop loss orders

lodged with our broker. Potential new trades during this period require too much initial

management. Your holiday, or your family, does not allow for this. These trading opportunities should be ignored because they cannot be effectively managed.

NEWSLETTER OUTLOOK: THE A B C D OF THE MARKET By Daryl Guppy

There is no change in this doldrums market. We noted over recent weeks that this is a market lacking courage and commitment. The economy simply doesn’t have the strength to go its own way, so the market is always

at the beck and call of foreign influence. An advance in the China US trade war in the next few weeks will be the major factor in trend development.

This is a market stuck in a trading band. Resistance is near line D and support near line A.

The trend line B is a short term resistance level and part of the trading

channel analysis. Trend line C is long term resistance but unlikely to exert any influence over the next few weeks. The XJO will struggle to move above

trend line B and resistance level D


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This is a market that is too weak to develop its own direction, so it decided to

follow the DOW higher and then dramatically lower, smashing through the support features. The much-lauded new highs were not highs made with any degree of

confidence. As we noted, this result was be easily shaken by external events and this exposes a worrying weakness in the trend so many treated the rally as a short-term trading opportunity.

The evidence of suspicion of trend strength comes from the GMMA relationships and this has been confirmed with the rapid collapse. The long term GMMA is not

widely separated. It has been constantly tested and tested and this usually indicates trend weakness. Compare the separation to the GMMA separation between February and August 2019. The wide separation in this period shows a strong trend. The

current narrow separation shows a weak trend, with frequent tests of the lower edge of the long term GMMA. These tests are like a jackhammer smashing its way through

a block of concrete. Each hammer blow weakens the concrete- each test of GMMA support weakness the trend.


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PORTFOLIO CASE STUDIES: MONEY MANAGEMENT

Starting cash position $100,000 - no brokerage or slippage 2% of risk = $2,000 NOTE Entered date is the newsletter date which contains the case study discussion.

OVERALL PROFIT TO DATE

The case study trade with ID8 is closed for a loss of $975.61 or 4.88%. The

case study portfolio return is $50,450 or 50.45% for the period starting July 1, 2019

and ending June 30, 2020. For the year starting July 1, 2018 – 2019 the case study portfolio return is

$91,794 or 91.79%. The case study portfolio return is $156,450 or 156.45% for the period starting

July 1, 2016-2017. Note that this includes 6 to 21 trade results. The case study

portfolio return is $92,464.15 or 92.5% for the period starting July 1, 2015- 2016. Equity trade size is generally kept constant at $20,000 in the case study portfolio so it

is easier to compare the case study trades over this and other years. Unless otherwise noted in the trade management notes, all equity case study trades are managed on

an end of day basis, with the exit taken at the best reasonable price on the day after the stop loss is triggered.

CUSTOMER CAUTION NOTICE AND COPYRIGHT Algobot Pte Ltd (CRN 201604500D) Pte Ltd is not a licensed investment advisor. This publication, which is generally available to the public, falls under the Singapore Media Advice provisions. The information

provided is for educational purposes only and does not constitute financial product advice. These analysis notes are based on our experience of applying technical analysis to the market and are designed to be used as a tutorial showing how technical analysis can be applied to a chart example based on recent trading data. This newsletter is a tool to assist you in your personal judgment. It is not designed to replace your Licensed Financial Consultant or your Stockbroker. It has been prepared without regard to any particular person's investment objectives, financial situation and particular needs because readers come from diverse backgrounds, with diverse objectives and financial situations. This information is of a

general nature only so you should seek independent advice from your broker or other investment

advisors as appropriate before taking any action. The publication should not be construed by any reader as Publisher's (i) solicitation to effect, or attempt to effect transactions in securities, or (ii) provision of any investment related advice or services tailored to any particular individual's financial situation or investment objective(s). Readers do not receive investment advisory, investment supervisory or investment management services, nor the initial or ongoing review or monitoring of the reader's

individual investment portfolio or individual particular needs. Therefore, no reader should assume that the Publisher serves as a substitute for individual personalized advice from a licensed financial professional of the reader's choosing. The decision to trade and the method of trading is for the reader alone to decide. The reader maintains absolute discretion as to whether or not to follow any portion of our content. Publisher does not offer or provide any implementation services, nor does it offer or provide initial or ongoing individual personalized advice. It remains the reader's exclusive responsibility to review and evaluate the content and to determine whether to accept or reject any strategy and to

correspondingly determine whether any such strategy is appropriate for a reader's individual situation. Publisher expresses no opinion as to whether any of strategy contained on this publication is appropriate for a reader's individual situation. The author and publisher expressly disclaim all and any liability to any person, whether the purchase of this publication or not, in respect of anything and of the consequences of any thing done or omitted to be done by any such person in reliance, whether whole or partial, upon

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