How I read and use news

Cho Sing Kum
30^th Dec 2002

I posted this in an online investment forum on 9^th November 2002. I reproduced it here.

Do I read news? Yes I do but not always. This is because I only do when I want to get confirmation. But most time I don't even need to. This is how I do it. When I see something bullish with technical analysis, I try to to find out whether the news is bearish. Since most people believe in the news, especially if it is a paid channel or service, it follows that when the news is bearish the market is short. When the market is short (bearish), it is at its strongest. Vice versa, when the news is bullish, when the market is long, it is at its weakest.

Similar to the public who "treasure" subscription based 24-hours financial news channels, I used to read the commentary pages on Reuters and Telerate. But only for the reason stated above. This is the important difference. All my years in the market, this has never fail me.

I saw this screen shot (see below) in the online investment forum on 9^th November 2002. It was probably captured the day before. With news report like, how could the US stock market go up?

Believe it or not, you decide your own destiny. If you want to read news, first make sure you don't get swept along by your inborn crowd behavior mentality.

Here is the monthly Dow Jones Industrial Average with data up to 27^th December 2002. This chart is not in my post in the forum. It is added here here to show how the chart can give a different picture.

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