SSI - Sino Strategic International

[motorway]

In (part an) answer to a question.

On the 2%x3 chart what caught the eye was a "broadening" pattern of congestion.... Which in a less liquid stock is maybe the best sign of the "other side" starting to get involved....

Who is the other side ? The other side is defined by who has had control of the immediate trend........

A P&F chart ( especially a P&F chart ) goes down and then sideways there has to be some degree of accumulation then in play...

The shape is suggestive of an Olympic hammer thrower , swings getting wilder and wilder... To the naive observer something is going to explosively give and if you are in the vicinity you drop to the ground or run for it..

To the more educated observer certain aspects of the position of the protagonist reveals the intended direction .

Intended direction=anticipated direction.........
Not predicted direction.......

In this case the hammer was released and We have had a huge throw
But in the opposite of the anticipated direction.

Broadening pattern of congestion suggests a large degree of uncertainty
wild swings making alternating new highs and lows.. demand and supply are chasing each other....

OK So where are We now ?

Potentially very oversold.
Why ?

There was active accumulation
demand did come in

(b) when it meets opposition, viz., when it
has about reached the end of its move

However the subsequent action reveals ( The response that the subsequent action has given to that test ) That if that congestion is accumulation it is only preliminary in Wyckoff terms it is

Preliminary Support (PS): is a form of a selling climax and is an action in which important demand comes in to stop the down move even if only temporarily. It is the first important rally in a downtrend and often occurs after the first oversold condition It's is a warning that the end of the down move may be near. The significance of the (PS) is that if the entire base proves to be accumulation then that accumulation may have begun at the (PS) and continued throughout the entire base.

What confirms preliminary support ? A selling climax !

Just look at the chart 26 continuous boxes DOWN ( chartcraft call that a long tail down or low spike )....

It is a speciality.. It is not BHP or a resource stock ( which have the spotlight ).. It was recommended by David Haselhurst, reaffirmed as a buy and then sold in these "volatile" times...

If you buy because someones tells you , You maybe sell when they tell You to as well... Only if You are underwater You maybe hang on till as long as you can hold your breath..........

SSI recently made a placement at $1.60.............

( We can all read the "news" and announcements... HongKong etc )

IF the congestion zone is Preliminary Support ( IF ).. Then the "long tail" is an accumulation base turned to the vertical.. But we will not know till the first three box reversal ( In a way We get paid for acting before everyone knows. Only at the the ultimate top is where We get to know 100% what We should have done ).........

It is a specialty one to DYOR with and accept the risk esp the "volatility"..

Weak hands ( If it is they who are selling ) tend to buy what has gone up ( BHP atm ) and sell what has gone down...

As My trading is very much informed by Richard Wyckoff.. I will leave You with this quote on how smart money acquires specialties under the cover of such time of "risk avoidance" by the "public"

The three charts tell a story...
If the spike is accumulation ...Rather than a base for sky rockets.. It is a wall for an express lift to climb...

AGAIN DYOR...observations are just that and could be very wrong..

and yes I do Hold........

..... may be induced for the purpose of accumulation. They
may pull out all their orders to see what the stock will do if left
to itself. If they wish to buy, they take what is offered without
bidding for it, never taking all there is, but always leaving some
on the offered side to keep the price depressed: If 500 shares are
offered at a certain price, they will bid to take 200 or 300. They
continue this process until they have acquired a substantial part of
their line, after which they may begin to bid for all they can
get up to a certain point or until they see that they are attracting
an outside following. Then they will withdraw their orders and let
the stock sag and turn dull in order to deceive the public into
thinking there is no further interest in it.

You judge if the earlier congestion and the current action is following this description...

It is possible that the more informed are actually selling.
It is Your analysis that You must rely on to reach your opinion

SSI has little "following" at the moment
even on the 1 box reversal chart there is only a solitary one box step back in the "tail"
There is volume on the bar chart

cheers
motorway

Hey Motorway, I've followed your analysis on SSI with a great interest.
What is your opinion on the 19% drop today? Think it'll keep going down or retrace?
I'd be interested to know are you holding/buying or selling?

 

[sting]

The bottom has fallen out of this one..I just brought in at $1.00... hoping that the new contracts and games in china will lift profits.... The chinese are known gamblers and with the upturn in the economy over there this should return to its former levels within the next 6 mths.

If im missing something here or if my research is flawed ..im open to all opinions from those who have followed this stock longer than I


SEMPER UBI SUB UBI

 

[nikkothescorpio]

Had a quick read over of the company...and in concept it sounds good but something must really be fundamentally wrong with this operation as its been going hard down for quite a while now.

$1 is a nice point to get in but really seems to have a very strong trend going against it - when you'd imagine it shouldn't - so I'd avoid it myself unless some positive signs came to the surface.

 

[motorway]

1) The stock was already in a decline before the "correction" Why ? Technically It does nor matter.. But I would guess that the revenue growth occurring now was expected 12 months ago.. And meanwhile resources have been strong etc

2) Just before the correction the bulletin article gave it a good coverage and made the stock a buy... This bought in weak longs... what are weak longs ?
Those who are buying BHP now because it is going up and they don't wont to miss out on the rally ( That they have so far missed out on )

a stock is in a weak technical position on the bull side when it has been purchased and is held by a large number of outside speculators; when most of these are looking for a profit; when the price of the stock has advanced to a point where no further buying can be stimulated for the time being. It stands to reason that when buying power is exhausted a stock must decline, no matter how strong its finances, management or earning power.

What killed it was the market correction the derisking from everything ( including BHP ) and the Bulletin then making it a sell ( because of the mkt volatility ) ..

All those followers of the Bulletin qualify to some extent as weak longs

held by a large number of outside speculators; when most of these are looking for a profit

They were left holding a bag and conditions had changed... Also throw in momentum traders who might also have bought.

Weak longs tend to sell out when prices fall because they are only holding for
a quick sure profit...

strong longs ( The strongest ) Buy only value they will buy more as the price falls......... As anyone been buying ? Where is the volume coming from
Why were there 100,000 odd bid at a ~$1.00 and then when taken out reset at .80 ( And other bids that were placed in the path of the negative momentum higher up)

The long tail is still accumulative still potentially very oversold

Market strength is not centred on stocks like this
it is centred on BHP and RIO with the banks playing catch up..

With weak longs ( also called weak hands ) The old saying is "It wont go up until after you sell "

Stocks bottom when weak hands under the cloud of sentiment and panic
transfer their stock to strong hands.... Who is NOW buying who is Now selling ?

On the other hand, a stock is in a weak technical position on the short side when the bears have exhausted their ammunition by selling all they can afford and when the buying power of investment and speculative purchasers is such that it resists the pressure of the bears; in other words, when demand overcomes supply. The weakness in such a position is found in the fact that all those who are short are potential bulls; they must, sooner or later, cover their commitments in order to close their trades.

Is the thrust shortening ?
Is the Volume rising ?
Is there any divergence ?? ( I will answer this one Not Yet )

Now it is a speciality ( look above for the activities of passive sponsorship )
There is NO short selling.. So there is not the violent bounce from short covering that kick starts a trading range. On the other hand all the buying must be "Good" ( Strong hands )... So it will not take much of a "cause" ( Horizontal zone on the P&F ) to make an effect...

So Divergence might show up too late to profit from

What precedes Divergence ? .....Inharmonious action...which We are now seeing ( last three bars effort is not in harmony with result )

I am also convinced that anyone who
really wants to make money in the market will do two
things: First, he will determine major accumulation.
That is, he will detect when major accumulation is
underway.

This is what matters .. There is such a powerful bandwagon effect.. The right question to ask is why is there someone on the other side and what is the subsequent response in the stock from their activity.

CTN would qualify for being a strong long for example

I have No idea if they are Buying or selling
They are an example of someone who does not follow tip sheets or I would expect momentum... And If keen on the stock would possible be pleased to see the lower prices and the willing sellers.

July 31, 2007 - 11:29AM

Micro cap stock investor Contango MicroCap Ltd has more than tripled its annual profit, and says it expects to capitalise on more public floats and rights issues this year...............................................................
............Some of its top 20 holdings include Sino Strategic International Ltd,

Trend is easy to see ( But some only see them when they are about over)
What precedes a change of trend is a certain technical position
And real accumulation or distribution between strong and weak hands
being the preparation....small stocks specialities can often have zones of vertical accumulation... When all who would sell have sold We will see..
In the meantime the fundamentals unfold and become clearer..

DYOR..... Yes, revenue growth, product launch and HK listing all sound good.
(All been flagged to some extent )

But what really matters is this, are better informed interests active and if so on what side.

purely an opinion and discussion...

Stocks like this offer great rewards because they are perceived as greater risks.

charts below
welcome any discussion on them

Risk is a real thing that can hurt
but it is taking risk that others wont that We get the reward for
No risk at all ? very low returns...

We want to take the risk that weak longs wish to offload
and take with them the rewards that the strong hands are holding on for.

We can but try



( quotes are from Richard Wyckoff from a number of his works 1922 and prior)


motorway

 

[motorway]

SSI ventures are in Shanghai and Mainland China...SSI does not mine Iron Ore in Australia..
Being listed on the HK exchange would make a lot of sense. Esp considering what is below....customers could become investors as well...

China Relaxes a Barrier, Letting Citizens Invest in the Hong Kong Stock Market

By KEITH BRADSHER
Published: August 21, 2007
HONG KONG, Aug. 20 — The Chinese government announced today that it would allow mainland Chinese citizens to invest in the Hong Kong stock market, the most significant move to date by Beijing officials to dismantle the barriers that prevent most Chinese from making international investments.

China still has many restrictions on movements of money in and out of the mainland for anything except payments associated with exports and imports. But Hong Kong, a former British colony returned to Beijing’s control in 1997, allows money to flow in and out of its financial markets without restrictions except for the usual checks against money laundering and other criminal activity.

By making it easier for Chinese investment to leave the mainland, the government hopes to offset some of the money pouring into the mainland through corporate investments and China’s soaring trade surplus.

The State Administration of Foreign Exchange, which manages the country’s $1.33 trillion in foreign exchange reserves and is under the control of the central bank, announced the new policy in a statement on its Web site.

“With China’s booming economy, the people’s income is rising and the people’s investment options need to be broadened,” the statement said. “China’s foreign exchange reserves, which are already very big, have paved the way for China’s people to invest overseas.”

nikkothescorpio Re: SSI - Sino Strategic International

Had a quick read over of the company...and in concept it sounds good but something must really be fundamentally wrong with this operation as its been going hard down for quite a while now.

$1 is a nice point to get in but really seems to have a very strong trend going against it - when you'd imagine it shouldn't - so I'd avoid it myself unless some positive signs came to the surface.

Very much part of the dynamic that has been in place

The first positive signs to look out for
are a "change in the behavior" and a change in the "ease of movement" in the line of least resistance..looking for signs the opposition ( demand ) is starting to assert..

Worthwhile looking at the trend in the sales revenue ( better later than never ) and the imminent launch of new products in sports lottery/betting .

Product diversification benefits are expected to receive a further strong boost in the near
future as a result of the agreement recently signed with Shanghai Sports Lottery
Administration (“SSLA”). As previously reported the full range of current and future SSLA
games will be rolled out through the POS network improving the stores cost to revenue
ratios and lifting the profile of the stores to “one stop shop” gaming outlets.
The timing of this SSLA rollout will coincide with the launch of a new high frequency
game scheduled for the 18 October 2007. Thereafter, our POSs will benefit from the
retailing of both existing Welfare Lottery games as well as traditional Sports lotto and the
new high frequency Sports Lottery game.

If they start week on week producing good figures + technically wash out the sellers at these prices
A different line of least resistance will emerge...

Trends are forced moves that spring from imbalances (plural )

DYOR

Opinions for discussion

motorway

 

[juw177]

Great post Motorway. But right now, I do not see how you can tell if strong hands are buying or is it just people trying to pick bottoms and have have stop losses. Because I know I would be one to do that.

And are you concerned that there has not been much stopping volume, which suggests that the people accumulating believe the price has further to fall?

 

[motorway]

Amount of volume is relative to what is normal for the stock in question.

No short selling means no short covering

This is a negative and a positive
There are no abrupt bounces to generate upward momentum.
But on the other hand it is all new longs that are Buying

The stopping volume is therefore extended over a larger price area
Such a stock is naturally more volatile
price movements can be exaggerated..

A lot of stopping volume in more liquid stocks can be short covering ( at least initially )
So We could expect less volume needed to stop the trend even if that trend is more exaggerated in relation to price..

Hence why if there are strong hands they will buy on a scale down
in order to keep some negative momentum happening..

Sentiment could change quickly esp with AGM not far away..

We do have change of ownership happening

So in one sense the volume price picture can be both clearer and cloudy

motorway

 

[Out Too Soon]

Based on hope or theory?

I see $1.90 to $2 as a reasonable and long-term support level, but if it breaks that, then 20 cents here we come!

Cheers,
GP

Well I was burnt before, this time cremated, I just got out at $1 seems 20c support may right after all.

 

[motorway]

Great post Motorway. But right now, I do not see how you can tell if strong hands are buying or is it just people trying to pick bottoms and have have stop losses. Because I know I would be one to do that.

And are you concerned that there has not been much stopping volume, which suggests that the people accumulating believe the price has further to fall?

A trend in price is sustained by volume

All the varied Price volume signatures spring from changes in the relationship and behavior between Price and Volume..

The behavior on this chart continues to be inharmonious

Such a condition is unsustainable and has a high degree of probability of signaling a change in trend..

If you look at this chart, You should immediately see a startling change in the price volume behavior ( and from a potentially very oversold condition )

The three blue lines mark identical junctures ( thrusts )

Price and Volume have been in harmony...
Now they are moving at different speeds..

This is unsustainable...

Of course there are two ways this can come back into harmony..
One is a change in trend...

The effort ( the volume ) is not in harmony with the result ( The price movement ) ( Wyckoff Principle of effort versus result )..

In the context of the trend and position in that trend ?

Is this where momentum traders Buy their breakouts..

The chart does more than suggest "stopping Volume"
It suggests climatic ending action..

In a stock like this principles can be superimposed
selling Climax , secondary test and Sign of strength can occur almost simultaneously..

And don't underestimate the absence of short selling..

That said potential return is not without real risks
and a change in trend is only one ( But I consider of much higher probability )
way the harmony between Price and Volume can resume..

To Me it looks like a Buy ( and I have been buying )

Always DYOR.... look forward to any discussion

some key words... change in behavior, ease of movement , shortening of thrust, effort , result, inharmonious action, trend and position...

motorway

 

[Jight]

Hi everyone,
I read about Sino today in Financial Review,
their project in China sounds really profitable.
Why is the sp still hitting rock bottm?
anything I miss here?

Cheers

P.S by the way the charts looking really interesting, but i don't how to read it that well yet, is there any thread that teach us beginner the basic reading of chart? I did a search before but there was just too much irrelavant threads poping up.

 

[Sean K]

P.S by the way the charts looking really interesting, but i don't how to read it that well yet, is there any thread that teach us beginner the basic reading of chart? I did a search before but there was just too much irrelavant threads poping up.

Jight, go to Chart School and read through the site. You'll find all the basic stuff you need to know there. Cheers, kennas

 

[juw177]

Ok I am getting on board this one. At first it just look like a constant downtrend but Motorway's analysis showed me that the volume is indicating a change coming along.

 

[Jight]

Thx Kennas, now I have much more what I'm looking at.
I got on at 1.015.
Some one just bought like 3000~4000 worth of shares for 1.06 and 1.09.
why do i think he or she just made a costly type fault
J

 

[juw177]

Thx Kennas, now I have much more what I'm looking at.
I got on at 1.015.
Some one just bought like 3000~4000 worth of shares for 1.06 and 1.09.
why do i think he or she just made a costly type fault
J

No it wasnt a mistake. That person can see sellers were getting exhausted and put a buy order for everything on sale under 1.10. No more no less.

 

[Jight]

I see,
thx for the explaining, now we have huge gap between buyers and seller.
Don't think it'll move again today.
Have to wait till tomorrow to see what would happen then.
Cheers

 

[sting]

Very little for sale under $1.20... its about time this SP reflected its true value. I believe that there was a write up in the Fin Review. Lets hope the trend keeps going.


SEMPER UBI SUB UBI

 

[weird]

Lets hope the trend keeps going.

The trend is down looking at the chart. I had a quick look at this stock during the day, large spread between the bids and the asks with little action ... not difficult to see why a 9% change could occur in either direction ... would not take much effort to move in either direction.

I wonder if any forum attention could have given rise to this, or as mentioned above, a nice poke, like a positive article ?

Looked at the funnies within Commsec ... abit depressing ... unfortunately there is a downward trend there too over the last 3 years.

 

[motorway]

Looked at the funnies within Commsec ... abit depressing ... unfortunately there is a downward trend there too over the last 3 years.

Of all the things that are really unimportant
I suspect that the trend in the fundamentals seen on commsec is one of the least important..

That is only a what.... A "What" is only useful as a starting place for asking how and why..

SSI has been in start up mode.... creating the business from scratch
The Industry itself is NEW...

What matters is the outlook for the next 6 mths.

Shares outstanding are always a finite number

A scarce resource that the forces of demand and supply are constrained By.

Trends are only whats too... It is How and Why that is always the more important..

From the recent announcement

By the end of October, 2007, Shanghai Kelo expects
to have 200 of its existing outlets equipped with SSLA terminals to retail the “5 out of 22” high
frequency game as well as SSLA’s traditional Sports Lotto products.
As the additional products from SSLA are marketed within Shanghai Kelo’s existing POS network,
they can be expected to increase Shanghai Kelo’s turnover significantly over time without much
increase in operating overheads. Currently, Shanghai Kelo enjoys 75% market share in Welfare
Keno sales in Shanghai. It is expected that its share of the SSLA “5 out of 22” high frequency game
turnover in Shanghai will exceed 50% in the short term.
The new “5 out of 22” game offers a top prize of RMB 25,000 and is played every 10 minutes
between the hours of 9am and 10pm with 78 games played each day. Initial acceptance of the game
was highly encouraging and players remarked at the ease to play the game and the improved odds
of winning prize money. The new high frequency game from SSLA is retailed along side the
Shanghai Welfare Lottery’s Welfare Keno game in which players select 10 out of 80 numbers with
a top prize of RMB 200,000.
Shanghai Kelo has developed a close working relationship with SSLA culminating in the signing of
a formal agreement in late September 2007. Shanghai Kelo has played an important role in the
successful launch of the new SSLA high frequency game and on behalf of SSLA, was responsible
for the development of the software for user interface and display design of the game.
The close working relationship between Shanghai Kelo and SSLA bodes well for the continuing
participation of Shanghai Kelo in the launch of any additional new games by SSLA, and in
particular, sports betting, within the existing Shanghai Kelo POS network.
It is expected that sports betting will be legalized nationwide as from the beginning of 2008 with
Shanghai joining the nationwide launch at the same time. Beijing, Shanghai, Dalian, and
Guangzhou are regarded as the four Soccer Cities of China.
Sports betting in China turns over significant amounts of money each year, estimated by industry
sources to be US$10 billion a month, with most of that being illegal activities. The government has
started to crack down hard on such illegal activities and since January 2007 has been trialing
legalized forms of sports betting in three provinces, in Beijing, Tianjin, and Guangdong, prior to
national legalization.

DYOR always

An important thing is the technical position...
Supply is being given it's chance today

It will test and demand will respond

This will help reveal what the real fundamentals that matter really are
and what the technical position from which the real trend will emerge is..

( whose hands are those finite shares being now held by ? )

real = what is effectual = What will produce effect..

The Fundamentals or the trend of the last three years
are no longer real ie They only matter as a what in order to ask how and Why

Again DYOR

Every upward or downward swing in the market, whether it amounts to
many points, only a few points, or fractions of a point, consists of
numerous buying and selling waves. These have a certain duration;
they run just so long as they can attract a following. When this
following is exhausted for the time being, that wave comes to an end
and a contrary wave sets in. The latter may attract more of a
following than the former. By studying the relationships between
these upward and downward waves, their duration, speed and extent,
and comparing them with each other, we are able to judge the
relative strength of the bulls and the bears as the price movement
progresses.

The waves of the market furnish a clear insight into changes in
supply and demand. By learning to judge all sizes of market waves,
you will gradually learn to spot the time when a rising market or a
rally, and the time when a declining market or a reaction, has
halted and is about to reverse. THESE ARE THE TURNING POINTS.

Richard Wyckoff

These waves are not anyone's waves but the waves of buying and selling as they are in themselves...price Volume & time, are what measures them..

They Build up and down always producing technical positions
and can not help but reveal intent... because You and "They" have to buy or sell First in order to profit at some future time...

Opinion and Discussion
motorway

 

[juw177]

100k order went through today for 1.02. This happened last week as well. But this was not an on market order, I know because I was front of the queue to buy at 1.02 but my order didnt get filled.

Where do these orders come from. Sorry if this sounds noob. Did someone exercise options to buy at the market price? I am confused. Because there was definitely no seller in the queue with 100k at 1.02.

 

[motorway]

It was a crossing

That is one broker was acting for both buyer and seller

The broker can do the trade as long as the trade is done at the best market price...

For example

A broker has an order to Buy SSI

He then gets an order from another client to sell a certain quantity

He then looks to see what the best price he could get for the seller
He then puts an almost simultaneous buy and sell order for the quantity involved ahead of the queue..

Getting the best price for the client selling and buying the stock for the client buying...

Market depth is often misleading
It is the demand and supply above and below the last price that really matters.

This esp with less liquid stocks can be mainly off screen..

There are various ways such trades can be judged ( as good demand or good supply)

context determines

DYOR
My understanding
My

motorway