Hello again, and many, many thanks to last weekend's workshop attendees for having made the day so enjoyable - it's such a pleasure to be able to help those who truly want to expand their trading knowledge, and who appreciate the fact that a bit of work is required - osmosis doesn't really work in this business!
(Let me point out, however, that there are no 'hidden secrets' that I 'divulge' during a workshop - the manual and WICS together contain the full TTEW methodology - but certainly a workshop lets me expand considerably on this, and allows me to take attendees 'live' through the exact process of looking for potential trades, analysing how we should be thinking, and what questions we should be asking ourselves as we shortlist prospective orders and consider what we might do on Monday morning.
Often, there are those who find 'face to face' works that bit better for them than does written explanation, and there were one or two 'Aha!' moments as something suddenly became clearer.)
Attendance at a workshop also includes both WICS delivery and the mentoring service for as long as I provide these (hopefully a long time!) and attendees will have nothing more to pay for these services, ever again.

On that note, there were quite a few people who wanted to attend last weekend, but my adherence to a maximum number of fifteen attendees meant they couldn't all do so, and therefore I'm going to run one more workshop to accommodate them, on Saturday 19th November in the Birmingham area.
This will almost certainly be the final one I run, simply because of time constraints - it's possible I may arrange something around my next UK trip in September 2006 but that will be the earliest possible date for another workshop.

There are currently several places available on 19th November, and if you wish to book a place, please contact my publishers, Streetwise Publications, on 01709 820033.

Moving on, it's nice to see that Gordon has been able to blame 'world oil prices' for his hurriedly revised (downwards) predictions for UK growth - seems the real experts were right all along and Gordon had been flying a kite - politicians are just so crooked and so predictable!
Their ability to bury bad news, and to shift the blame away from themselves, is extraordinary.
The reality of course is that UK growth never had the remotest chance of being as high as prior Treasury estimates, because the figures depended upon continuing spending by consumers, which in turn depended upon continuing remortgaging and the use (misuse) of credit facilities. The fact is the consumer is 'all spent out' - rising filling station prices have only brought reality a wee bit closer and allowed Gordon to choose his moment and use the excuse that has been handed him on a plate. What a sorry creature altogether, but he's not alone!

On the same topic (burying bad news) hardly anyone noticed, but at the height of the New Orleans evacuation fiasco the other week, one of the USA's two major mortgage companies - 'Fannie Mae' - announced (whispered) a profits warning, something frankly of massive significance to the markets overall, because without a doubt it's a forewarning of the coming slump in American property prices and the collapse of debt - fuelled consumer spending on that side of the water too.
Interestingly, one of the major American consumer bellwether stocks, Walmart, is dropping and has fallen below its 1999 price. Not good.

In the UK, lenders are now really clutching at straws to boost their mortgage sales figures - again, I'm amazed at just how far into denial some of these people truly seem to be.
How do you like this? - new 'Ability to Repay' mortgages! In my country bumpkin fashion, I rather thought that would be the principal criterion for granting ANY kind of mortgage!

What the lenders are suggesting is that some people could actually afford more repayment per month than might be represented by 'conventional' salary multiples.
In theory, if you earn say £25000, you would be entitled to borrow about 3.5 times that amount, or about £87500, with 1 times a partner's income on top. Perhaps that might mean a couple could stretch to borrowing £100,000.

Now, however, thanks to the immense generosity of some lenders, if you have 'no debts and no children', plus a deposit of around £20000, instead of 'only' being able to borrow that measly £100k, they'll lend you up to £123k!(because in their view, you have 'the ability to repay a higher amount').
I'm somewhat intrigued by how the contract may be worded: "We, Sam and Samantha Stonybroke, solemnly swear never to have children, nor max out our credit cards, failing which we shall instantly repay in full the incredibly generous mortgage you have lent us".
So Sam and Samantha save for ages, scratch together a deposit of £20k, borrow £123k, and next year they're approaching negative equity on falling house valuations just as Samantha announces the not so good news that they had better decorate the back bedroom.

Now please don't get me wrong - I am NOT in any way trying to be 'holier than thou' about excessive borrowing - I too once had a mortgage and a car loan etc etc and sometimes it's hard not to become overborrowed - but this rather smacks of desperation by lenders, to shore up the 'first time buyer' segment of the market, and don't forget that the lender will suffer a whole lot less than will the individual borrowers if things go badly wrong.
I'm not sure the High Street can rely on a bumper Christmas this year!

Anyway, that's today's rant over with, you'll be pleased to hear.

Whither the markets, then? One final upwards push over the next fortnight or so, I suspect, and then the long predicted resumption of the bear market. Definitely 'Nae lang noo' as suggested in the previous issue of WICS.

On to this weekend's charts, and at the workshop, we had a wee look at the use of trendlines to help confirm (or otherwise) potential areas where a trend might be about to reverse. There's an example in WICS of 11th September, and several others scattered about over the months. (3rd July, 29th May, among others.) Today, we'll look at one in the other direction - ie a downtrend that might possibly be about to turn around and become an uptrend.

Next, there's an update on Collins Stewart Tullett, last featured in WICS of 14th August. This time, it's featured just to illustrate the SL (Stop Loss) options that might have been available to you.

Then we'll briefly look at the chart of Kingfisher, which I mentioned in WICS of 11th September - just to perhaps reinforce the point that much though I simply enjoy rabbiting on in WICS, it does actually have a little method in its overall madness. Seriously, if you don't already do so, please take time, just occasionally, to read through previous issues, because that undoubtedly will help you 'join the dots' overall. I realise I have banged on about this point ad nauseam, but the extent to which you can take ownership of the basic methodology, will dictate the extent to which you can 'play around with it' and formulate something that works for you.

Lastly today, on 28th August I mentioned Business Post, and I'm featuring its chart now, to illustrate a couple of things - how to protect yourself (to an extent - not always possible of course) from being filled 'too soon', and when to cancel an open order. Please note that this is a pretty extreme example of the latter, and it's not always that easy to decide if an order is getting a bit 'iffy' - that skill comes with practice - the general rule to work to, is that if you are beginning to feel uncomfortable with a chart's action, then stand aside. You can always revisit it, and that's one of the points to note about trading - you can order to buy, order to sell, or DO NOTHING. I have put that in capitals because many people seem to miss the fact that doing nothing can be as positive a decision as doing something! (I'm not speaking here about doing nothing because you're bone idle - if that's the case, be prepared to fail.)
But 'doing nothing' having decided that's the best plan on a specific chart, implies a positive, confident approach to this business.

Anyway, that's plenty for this weekend - next weekend you're going to have to do without me (from Thursday afternoon till Tuesday morning) because it's the VED's VEW and despite all my protestations to the contrary, I'm really looking forward to it - particularly the ceilidh afterwards!

The next WICS will be on 9th October, and I'll let you know then who are the competition winners. (Well, not exactly WHO they are, because I would never give out that kind of personal information) but WHY they are the winners.

And finally, another wee message to recent subscribers who haven't yet sent me an alternate email address to their current ntlworld or tesco.net ones - you won't be receiving the new password in October!
Sorry to sound so harsh, but I truly don't have the time to mess around with this. All other addresses so far, work just fine, and I get so many emails nowadays that it's simply unfair on everyone else if I have to waste effort on the very few that I know have a 90% chance of being bounced back at me - especially when it takes only a couple of minutes to set up the likes of a hotmail, yahoo or uk2 email address.

OK - I'm off to brush up on my Duke of Perth (Aaghh!) and my speech (double Aaghh!) and if I survive the wedding, you'll hear from me again on 9th October.

All the best till then,
Ian.

.'IMPORTANT NOTICE: These WICS charts are for EDUCATIONAL PURPOSES ONLY. They represent only MY understanding of what is happening in the market for any particular share, stock, commodity or index. In NO circumstances should they be construed as recommendations to trade. If I choose to trade what I see, that is MY decision. YOU must, in turn, come to YOUR OWN conclusions about what action, if any, YOU might choose to take'.