{"title":"Volume 17 (1999)","description":"\u003cp\u003eBrowse Volume articles by issue:\u003c\/p\u003e\u003cdiv style=\"display:flex;flex-wrap:wrap;gap:12px;\"\u003e\n\u003ca href=\"\/collections\/articles-volume-17\/issue-01?sort_by=title-ascending#ProductGridContainer\" style=\"margin-right:16px;\"\u003eChapter 1 January\u003c\/a\u003e\u003ca href=\"\/collections\/articles-volume-17\/issue-02?sort_by=title-ascending#ProductGridContainer\" style=\"margin-right:16px;\"\u003eChapter 2 February\u003c\/a\u003e\u003ca href=\"\/collections\/articles-volume-17\/issue-03?sort_by=title-ascending#ProductGridContainer\" style=\"margin-right:16px;\"\u003eChapter 3 March\u003c\/a\u003e\u003ca href=\"\/collections\/articles-volume-17\/issue-04?sort_by=title-ascending#ProductGridContainer\" style=\"margin-right:16px;\"\u003eChapter 4 April\u003c\/a\u003e\u003ca href=\"\/collections\/articles-volume-17\/issue-05?sort_by=title-ascending#ProductGridContainer\" style=\"margin-right:16px;\"\u003eChapter 5 May\u003c\/a\u003e\u003ca href=\"\/collections\/articles-volume-17\/issue-06?sort_by=title-ascending#ProductGridContainer\" style=\"margin-right:16px;\"\u003eChapter 6 June\u003c\/a\u003e\u003ca href=\"\/collections\/articles-volume-17\/issue-07?sort_by=title-ascending#ProductGridContainer\" style=\"margin-right:16px;\"\u003eChapter 7 July\u003c\/a\u003e\u003ca href=\"\/collections\/articles-volume-17\/issue-08?sort_by=title-ascending#ProductGridContainer\" style=\"margin-right:16px;\"\u003eChapter 8 August\u003c\/a\u003e\u003ca href=\"\/collections\/articles-volume-17\/issue-09?sort_by=title-ascending#ProductGridContainer\" style=\"margin-right:16px;\"\u003eChapter 9 September\u003c\/a\u003e\u003ca href=\"\/collections\/articles-volume-17\/issue-10?sort_by=title-ascending#ProductGridContainer\" style=\"margin-right:16px;\"\u003eChapter 10 October\u003c\/a\u003e\u003ca href=\"\/collections\/articles-volume-17\/issue-11?sort_by=title-ascending#ProductGridContainer\" style=\"margin-right:16px;\"\u003eChapter 11 November\u003c\/a\u003e\u003ca href=\"\/collections\/articles-volume-17\/issue-12?sort_by=title-ascending#ProductGridContainer\" style=\"margin-right:16px;\"\u003eChapter 12 December\u003c\/a\u003e\u003ca href=\"\/collections\/articles-volume-17\/issue-13?sort_by=title-ascending#ProductGridContainer\" style=\"margin-right:16px;\"\u003eChapter 13 Product Reviews \u0026amp; Quickscans\u003c\/a\u003e\u003ca href=\"\/collections\/articles-volume-17\/issue-14?sort_by=title-ascending#ProductGridContainer\" style=\"margin-right:16px;\"\u003eChapter 14 Books for Traders\u003c\/a\u003e\n\u003c\/div\u003e","products":[{"product_id":"v114tradnot","title":"V.17:3 (144-145): Traders' Notes","description":"For those traders who want a clear and\nbrief explanation of various concepts often\ntouched on in technical analysis and trading,\nwe offer Traders Notes.\u003cbr\u003e\u003cbr\u003eINTERMARKET ANALYSIS\u003cbr\u003e\u003cbr\u003eIntermarket analysis, one of the pillars\nof technical analysis, is the comparison\nof the price action of one market to\nanother. This comparison can be as\nsimple as placing two different charts\nside by side. The most widely endorsed\nuse of intermarket analysis hails from\nthe Dow theory, whereby the movement\nof the Dow Jones Industrial Average\n(DJIA) is compared with the Dow\nJones Transportation Average (DJTA).\nThe theory holds that if both averages\nare trending higher, the investor should\nconclude that the underlying fundamentals\ndriving the stock market are sound\nand that the trend of the market is up.\nWhen one of the averages begins to\ndiverge for example, one average\ntrends to higher highs, while the other\naverage fails to make a higher high a\nwarning is signaled (Figure 1) but not\nnecessarily a reversal, as the markets\nmay get in gear at a later point. The key\nis that intermarket analysis can aid the\ninvestor in determining the trend of the\nmarket as well as alert the investor to a\npotential trend reversal.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133905990001,"sku":"\\V17\\C03\\023NOTE.PDF","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_17adbe55-8551-459e-bdf0-61e3c57a2050.jpg?v=1739656359"},{"product_id":"v177letters","title":"V.17:7: Letters","description":"\u003cp\u003eWYCKOFF METHOD USEFUL\u003cbr\u003e\nEditor,\u003cbr\u003e\nI recently finished reading your wonderful\u003cbr\u003e\nbook, Charting The Stock Market:\u003cbr\u003e\nThe Wyckoff Method, and am send-ing\u003cbr\u003e\nthis letter to thank you for publishing\u003cbr\u003e\nit and for making it available at a\u003cbr\u003e\nvery reasonable cost. Economy isnt\u003cbr\u003e\neverything, but in this arena, spending\u003cbr\u003e\nhundreds of dollars for books and products,\u003cbr\u003e\nreplete with appeals to human greed\u003cbr\u003e\nand promises of ease of gain, is not\u003cbr\u003e\nuncommon. I also appreciate the fact\u003cbr\u003e\nthat your book consistently states that\u003cbr\u003e\nthis method offers no magic formula or\u003cbr\u003e\nindicator, but rather presents itself as an\u003cbr\u003e\naid to navigation of the market.\u003cbr\u003e\nIve found that this study of market\u003cbr\u003e\nbehavior has helped me to evaluate the\u003cbr\u003e\nvalidity of various technical indicators,\u003cbr\u003e\nand how they might be used in conjunction\u003cbr\u003e\nwith one another to develop high-probability\u003cbr\u003e\ntrading setups. With further\u003cbr\u003e\ntesting, I might discover easier combinations\u003cbr\u003e\nof studies.\u003c\/p\u003e","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133906153841,"sku":"\\V17\\C07\\07LET.PDF","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_7c6667ad-a7f3-4aa3-8aa3-c45fe6ac743b.jpg?v=1739656373"},{"product_id":"v136inkevhag","title":"V.17:8 (362-366): Interview: Kevin Haggerty by Thom Hartle","description":"A Guide To Conquering The Trading Markets - Kevin Haggerty\u003cbr\u003e\u003cbr\u003eKevin Haggertys career on Wall Street covers nearly 25 years and numerous\nresponsibilities ranging from senior vice president and manager of equity\ntrading at Fidelity Capital Markets to serving as a managing director of the\nChicago Board Options Exchange. Now hes teamed up with Mark Boucher\nand Larry Connors, some other noted names in the business that STOCKS \u0026amp;\nCOMMODITIES readers may recognize, to cofound a Website for traders called\nTRADEHARD.COM. S\u0026amp;C Editor Thom Hartle spoke to Haggerty on May 18,\n1999, about topics ranging from stockpicking, the opportunities available due\nto the way major players move in the markets, and his upcoming book, as well\nas his contribution to The TRADEHARD.COMs Guide To Conquering The\nTrading Markets.\u003cbr\u003e\u003cbr\u003eLets start with a little history.\nBefore entering the trading\nindustry, I received my\nbachelors degree from Manhattan College,\nand served in the US Marine Corps\nfrom 1965 to 1969. From 1976 to 1981,\nI was a vice president at Dean Witter\nReynolds and manager of the equity and\nconvertible trading desk. I became a general\npartner in charge of equity and convertible\ntrading at Walsh Greenwood,\nwhere I was from 1981 to 1990. While\nthere, I also directed the sales and marketing\nof the SHARK system, the first\npersonal computerbased equity and\noption trading quotation system. From\n1990 to 1997, I served as senior vice\npresident and manager of equity trading\nat Fidelity Capital Markets, a division of\nFidelity Investments, where I was in\ncharge of US institutional equity trading\nand exchange floor operations.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133907988849,"sku":"\\V17\\C08\\061INT.PDF","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_64d6a266-1bdd-49d4-8944-4a2d64a102b0.jpg?v=1739656497"},{"product_id":"v121eurstruc","title":"V.17:5 (215-223): The Euro's True Colors by Walter Bressert and Doug Schaff","description":"The Euros\nTrue Colors by Walter Bressert and Doug Schaff\u003cbr\u003e\u003cbr\u003e\nHow do you analyze the Euro, a currency that sprang to life\nwith no price history?\u003cbr\u003e\u003cbr\u003eHow do you analyze a full-fledged\ncurrency that came into\nbeing overnight? Despite its\nliteral lack of price history,\nmillions of foreign currency\nmarket participants importers,\nexporters, investors, risk\nmanagers, not to mention others\n instantly had exposures,\nlong or short, the moment the\nEuro took its first breath.\u003cbr\u003e\u003cbr\u003eThere is no doubt that fundamental\nfactors will determine\nthe Euros value, as they\nhave for the German mark, the\nFrench franc, and other currencies. The problem arises in\ninterpreting the direction and impact of gross domestic product\n(GDP), trade, interest rates, and politics in the short run. In\naddition, while fundamentals move the markets, they often\nlook the most bullish at tops and the most bearish at bottoms.\nOn July 9, 1998, the mark, the franc, and other European\ncurrencies made cycle lows. The currencies rallied in October\nof that year on the back of weaker US capital markets and\npositive anticipation for the Euro talk of economic synergies,\na smooth start for the new currency, and capital flowing\ninto Europe.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133909496177,"sku":"\\V17\\C05\\033EURO.PDF","price":4.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_d0a71c74-8a90-46ab-92db-e4ed0f3d3968.jpg?v=1739656572"},{"product_id":"v184desfunby","title":"V.17:2 (84-86): Designer Funds by Gary H. Elsner, Ph.D.","description":"Designer\nFunds\u003cbr\u003e\u003cbr\u003eby Gary H. Elsner, Ph.D.\u003cbr\u003e\u003cbr\u003eMutual funds show a less than stellar performance relative to\nthe Standard \u0026amp; Poors 500 index. It should come as no\nsurprise, then, that Wall Street has responded by offering\nproducts that mimic the S\u0026amp;P 500. Going a step further, some\nfunds are set to do the exact opposite of the S\u0026amp;P 500 and\nthereby offer a hedge. Here are some guidelines.\u003cbr\u003e\u003cbr\u003eThe right financial instruments\nare the keys to great investing.\nOver the last four years, 90%\nof mutual fund managers have\nbeen outperformed by S\u0026amp;P\n500 index funds, so it is no\nsurprise that new funds created\nto outperform the S\u0026amp;P\n500 have attracted attention. I\nrefer to these as designer funds\nbecause they are designed to\nperform in specific ways, as opposed to having the simple\nobjective of maximizing returns.\u003cbr\u003e\u003cbr\u003eAs an example, the Rydex Nova fund is designed to have\n150% of the movement of the S\u0026amp;P 500. If the S\u0026amp;P 500 goes\nup 6%, Rydex Nova will go up approximately 9%. If the S\u0026amp;P\n500 goes down 6%, then Rydex Nova will go down about 9%.\nNot only that, recently introduced funds are designed to have\nmovements of up to 200% of the S\u0026amp;P 500. And there are\nfunds that move in an inverse relationship to the S\u0026amp;P 500 and\nthe NASDAQ 100 as well.\u003cbr\u003e\u003cbr\u003eIf we refer to these enhanced movements as leveraging, we\ncan create just about any degree of leveraging by investing\ndifferent amounts in one of these instruments and in a money\nmarket fund. Lets take a look at the new designer funds,\nstudy how we can achieve various degrees of leveraging and\ndetermine ways in which these funds can be used in developing\nnew investment models.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133909627249,"sku":"\\V17\\C02\\013DESI.PDF","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_2f046c8e-4235-4969-afa7-c2f035d50714.jpg?v=1739656580"},{"product_id":"v1tradtip","title":"V.17:9(424-425): TRADER'S TIPS","description":"TRADESTATION\/SUPERCHARTS\u003cbr\u003e\u003cbr\u003eThis month in Traders Tips we take a look at stochastics as\ndefined in this issues article Stochastics by Stuart Evens. The\ncalculation of the %K line, as defined in the article, is identical\nto the way in which it is calculated in EasyLanguage. The %D\nline, though, differs slightly. With this in mind, I have presented\nthe calculation for the %K and %D, using both the regular and\nslow calculations. In addition, I have included two EasyLanguage\nindicators, one that plots the regular version of the pair and one\nthat plots the slow version of the pair.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133913067889,"sku":"\\V17\\C09\\073TIP.PDF","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_c3178823-8cd8-4a11-86e4-7935d5c211a9.jpg?v=1739656814"},{"product_id":"v119enfasfou","title":"V.17:5 (199-208): The Endpoint Fast Fourier Transform System by Dennis Meyers, Ph.D.","description":"The Endpoint Fast Fourier Transform System\u003cbr\u003e\u003cbr\u003eLast time, we explored the Fourier transform, a\nmathematical technique for analyzing data to determine\ncyclical component. This time, we use the fast\nFourier transform as a trend determinant for a model\nfor trading the Standard \u0026amp; Poors 500.\u003cbr\u003e\u003cbr\u003eIn my previous article, The Discrete\nFourier Transform Illusion,\nwe demonstrated the misuses of\nthe Fourier transform mathematical\ntechnique as applied to the\nStandard \u0026amp; Poors 500 index. We\nshowed how fitting the Fourier\ntransform to the S\u0026amp;P 500 index\ndata series produced a perfect curve-fit on past data,\ngiving the illusion that this technique would predict\nthe major turning points of the S\u0026amp;P 500. However,\nwhen we examined the Fourier transform on a day-by-\nday walk-forward basis, this seemingly wondrous\npredictive capability disappeared.\nThis time, we will demonstrate how to use Fourier\ntransform using the computational algorithm called\nthe fast Fourier transform (FFT) on a walk-forward\nbasis on the S\u0026amp;P 500 continuous futures contract (SP).","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133918081393,"sku":"\\V17\\C05\\031END.PDF","price":4.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_b68bc7d8-f663-4729-8b97-f47920270b37.jpg?v=1739657188"},{"product_id":"v178letters","title":"V.17:8: LETTERS","description":"TRACKING COMMODITY PORTFOLIO\u003cbr\u003e\u003cbr\u003eEditor,\nIs there a Website I can use to track my\nportfolio of commodities and options?\nCurrently, I use Yahoo!, but it only\ncovers the Chicago Board of Trade and\ndoesnt provide quotes from NYMEX\nand other exchanges. Perhaps this topic\ncould be the subject of a short article.\nTIM DENKER, via E-mail\u003cbr\u003e\u003cbr\u003eThanks for writing. Last month, we\nlaunched a new section called Websites\nfor Traders, where we describe\nWebsites with features that traders\nwould find of interest. Well keep an eye\nout for a Website that offers commodity\nand options portfolio tracking. In the\nmeantime, perhaps another reader can\nsuggest such a Website.Editor","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133918278001,"sku":"\\V17\\C08\\08LET.PDF","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_fc0079e6-b8d8-49c9-98f1-23380090fa4d.jpg?v=1739657204"},{"product_id":"v155tradagga","title":"V.17:12 (555-560): Trade Against The Gap by Stephane Reverre","description":"Trade Against The Gap by Stphane Reverre\u003cbr\u003e\u003cbr\u003eHeres a systematic way of trading from close to close, depending on the amplitude of the move from one day to the next.\u003cbr\u003e\u003cbr\u003eDoes it pay to trade against a one-day price move of a certain size? That price action is a gap, and last issue, I explored how trading into a gap from the open to the close on the same day could be profitable. This time, I used descriptive statistics to develop the same strategy\ntrading from close to close: depending on the amplitude of the move from yesterday to today, I took a position against the gap at todays close, and then I unwound these positions at the close of tomorrow or the next day.\u003cbr\u003e\u003cbr\u003eAs in my previous article, I assumed that a correction was probable if the gap the distance between closes was greater than a given minimum length. There are two important questions that had to be asked: What level of a close-to-close gap is appropriate to trade? and What is the appropriate holding period for these positions?","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133919719793,"sku":"\/V17\/C12\/100GAP.pdf","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_67285afc-6ab4-41f8-bd7b-941e195d29fb.jpg?v=1739657312"},{"product_id":"namegoeshere","title":"V.17:11 (469-475): Trading The Opening Gap by Stephane Reverre","description":"Trading The Opening Gap by Stephane Reverre\u003cbr\u003e\u003cbr\u003eIs it possible to profitably trade a gap opening from the previous close? Heres one traders test of that idea using Dow Jones Industrial Average (DJIA) stocks as the subjects.\u003cbr\u003e\u003cbr\u003eProfitably buying an opening dip or selling an opening\npop, depending on the size of the move, is possible,\nbut its not easy money. I systematically tested taking a position in the morning following a gap at the open and unwinding the position at the close of the same day, regardless of profitability. What I found was that the strategy, though not hugely profitable, was consistently profitable.\u003cbr\u003e\u003cbr\u003eHeres an example of how you could do the analysis yourself, complete with code (see Traders Tips).\u003cbr\u003e\u003cbr\u003eCONVENTIONAL WISDOM\u003cbr\u003eIf nothing is happening, there is no reason why a stocks price would jump one way or the other. Therefore, mild price movements are the general expectation. What I wanted to capture were abnormal movements -- above a certain trigger level -- because, in those cases, I expected a correction. I could not predict the speed of the correction, but still, I reasoned, if unwarranted gaps were spotted quickly, it should take at most a few days for investors to realize that a particular stock had been unduly inflated or hammered. Because I restricted myself to a single trading day, I estimated -- or at least hoped -- that this correction would be initiated quickly and completed at the end of a single session.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133922046321,"sku":"\\V17\\C11\\083TRAD.PDF","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_a4526070-9902-4ada-a596-a24cd7707cf8.jpg?v=1739657448"},{"product_id":"v124ofgoland","title":"V.17:5 (246-248): Of Gold And Bonds, Gold Is The Leader by Alex Saitta","description":"Of Gold And Bonds,\nGold Is The Leader\nby Alex Saitta\u003cbr\u003e\u003cbr\u003eDoes gold lead the bond market, or is it the other way\naround?\u003cbr\u003e\u003cbr\u003ePreviously, we uncovered strong\ncoincidental relationships between\ngold and the dollar, inflation,\nbonds and the CRB index.\nAs bond traders, though, we are\nmost interested in the relationship\nbetween gold and the bond\nmarket. Looking at the past 20\nyears of data (Figure 1), we noticed\ngolds reversals have led bond yield reversals. Looking\nbeyond the peaks and valleys and considering all the data,\ndoes gold have a tendency to lead the bond market?\u003cbr\u003e\u003cbr\u003eTo answer this question, we applied basic statistical analysis\nto measure relationships between two series of data.\nCorrelation analysis measures the degree of association between\nall the data points of two series. The product of this\nmathematical comparison is referred to as the correlation\ncoefficient. Correlation coefficients range from -1.0 to +1.0\nand identify the direction as well as the strength of a relationship\nbetween the two series being compared.\u003cbr\u003e\u003cbr\u003eFor example, a coefficient of +1.0 represents a perfect\npositive relationship. When one variable rises, the other rises in lockstep. When one falls, the other falls in lockstep. A\ncoefficient between zero and less than +1.0 is a nonperfect\npositive relationship. When one variable rises, the other\nusually rises somewhat. When one falls, the other usually\nfalls somewhat.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133925060977,"sku":"\\V17\\C05\\038GOLD.PDF","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_eabed9a8-56cc-4cb9-bb5d-976282e597ac.jpg?v=1739657614"},{"product_id":"v127indougfa","title":"V.17:6 (275-280): Interview: Doug Fabian Of Fabian Investment Resources by Thom Hartle","description":"Keeping Investing Simple\nDoug Fabian Of\nFabian Investment\nResourcesFor mutual fund investors, one of the bestknown newsletters is Fabian\nInvestment Resources, previously known as Telephone Switch Newsletter. It\nwas begun by financial planner Dick Fabian, whose 1976 book, How To Be\nYour Own Investment Counselor, triggered enough response for him to start\nthe newsletter the following year. Since then, the newsletter has prospered,\nwith Fabians son, Doug, later picking up the reins and expanding its\nhorizons. Editor Thom Hartle talked to Doug Fabian via telephone on March\n24, 1999, asking him about, among other topics, the key points to the Fabian\nmethodology, how he determines the trend of the stock market, and how\nbacktesting an idea is crucial.\u003cbr\u003e\u003cbr\u003eLets start at the beginning.\nCan you give me some\npersonal history as well as\nsome of the firms history?\nWere celebrating the 22nd anniver-sary\nof the Telephone Switch Newslet-ter,\nwhich became Fabian Investment\nResources in 1993. My father first pub-lished\nthe newsletter 22 years ago, after\nhe self-published his book How To Be\nYour Own Investment Counselor, which\nhe wrote after the 1973-74 bear market.\nThe book followed the advent of the\nmoney market fund and the telephone\nexchange feature within mutual fund\nfamilies. His premise was that stocks\nwere the place to invest to grow your\nportfolio, and mutual funds were, and\nare, the simplest way to participate in\nthe stock market.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133927289201,"sku":"\\V17\\C06\\044INT.PDF","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_fd10fc90-dc32-446b-9904-d6c1f1cc56ae.jpg?v=1739657763"},{"product_id":"v151apganant","title":"V.17:12 (515-520): Applying Gann Angles To Computer Charts by Brent Aston","description":"Applying Gann Angles To Computer Charts by Brent Aston\u003cbr\u003e\u003cbr\u003eTried and true and far from being discarded,Gann angles are daily tools for some traders. Here s how\nto use two of W.D.Gann s central ideas in today s\ncomputerized environment.\u003cbr\u003e\u003cbr\u003eTrader William D. Gann became famous in the early 20th century for his ability to forecast exact price targets in the stock and commodity markets. To arrive at his forecasts, W.D. Gann used a combination of methods, ranging from simple counts and angles to correlating natural events. Of course, many securities that exist now did not exist then, and volatility is very different from\nwhat it was in his time. However, the geometrical\nrelationships that he applied to data appear to\nwork equally well on modern data.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133927420273,"sku":"\/V17\/C12\/092GANN.pdf","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_852faf96-2002-436a-9f2f-a54e6040a996.jpg?v=1739657774"},{"product_id":"v1711letters","title":"V.17:11: Letters","description":"Letters to S\u0026amp;C\u003cbr\u003e\u003cbr\u003eRegression for forecasting, exit strategies and getting started as a trader are some of the letter topics in this month's issue.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133928993137,"sku":"\/V17\/C11\/11LET.pdf","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_695b1c91-8d1c-49e2-b0a1-ed6c23083d5d.jpg?v=1739657883"},{"product_id":"v1107tradtip","title":"V.17:2 (107): Traders' Tips","description":"TRADERS TIPS\u003cbr\u003e\u003cbr\u003eHere is this months selection of Traders Tips, contributed by\nvarious developers of technical analysis software to help readers\nmore easily implement some of the strategies presented. Internet\nusers will also find these and some previous Traders Tips on our\nhome page at http:\/\/www.Traders.com.\n✦ METASTOCK\u003cbr\u003e\u003cbr\u003eIn Trading Stocks With A Cyclical System, Jeffrey Owen Katz\nand Donna McCormick introduce a system based on stock cycles.\nIn MetaStock 6.5 or higher, you can easily recreate this system.\nWith MetaStock running, choose System Tester from the\nTools menu, click on the New button and enter the following\nformulas:\n\u003cblockquote\u003e\u003cpre\u003e\nEnter Long\nthresh:= 4;\nk:= 3;\nm:= 63;\nValue1:= Stdev(Ref(ROC(C,k,$),-m),20);\nValue2:= Ref(ROC(C,k,$),-m);\nWhen(Value2 \u0026gt; thresh*Value1)\nEnter Short\nthresh:= 4;\nk:= 3;\nm:= 63;\nValue1:= Stdev(Ref(ROC(C,k,$),-m),20);\nValue2:= Ref(ROC(C,k,$),-m);\nWhen(Value2 \u0026lt;-thresh*Value1)\nStops\nInactivity\u003cblockquote\u003e\nPositions - Long and Short\nMethod - Points\nMinimum Change - 15000\nPeriods - 10\u003c\/blockquote\u003e\u003c\/pre\u003e\u003c\/blockquote\u003e\u003cbr\u003e\u003cbr\u003eAfter entering the formulas, click OK, then click on Options.\nOn the Testing page, set the Trade Delay to zero, set Positions\nto both, then set any other desired options. Click OK to save\nthe changes, then open a chart and run the system.\nAllan J. McNichol, EQUIS International\n800 882-3040, 801 265-8886\nhttp:\/\/www.equis.com","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133937840497,"sku":"\\V17\\C02\\017TIPS.PDF","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_d0cf4631-7808-4eb1-aa28-bd7ccd738db5.jpg?v=1739658338"},{"product_id":"v138innatofm","title":"V.17:1 (38-42): Interview: The Nature Of The Market Is Change: Bruce Kamich by Thom Hartle","description":"The Nature Of The Market Is Change:\nBruce Kamich\u003cbr\u003e\u003cbr\u003eTechnicians follow numerous markets, and some specialize in specific areas,\nsuch as equities or fixed income. With the Treasury bond yields recently hitting\nlows that were unthinkable by most only a few years ago, we thought that\ntalking to a specialist in this area would be apropos. Meet Bruce Kamich, who\nis senior vice president for research, development and management of the\nelectronic financial information service MoneyWatch for McCarthy, Crisanti\n\u0026amp; Maffei, and currently, hes on the board for the Market Technicians\nEducational Foundation. STOCKS \u0026amp; COMMODITIES Editor Thom Hartle called\nKamich on October 14, 1998, and asked him about some of his favorite\nindicators, including the last-half-hour index, secondaries, and the confidence\nindex, and how he views the coming century and the changes it will bring.\u003cbr\u003e\u003cbr\u003eHuman psychology will always be the same. Greed and\nfear are still going to operate in the same way they always\nhave. We just have to determine different ways to measure\nit. Bruce Kamich","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133937938801,"sku":"\\V17\\C01\\004INT.PDF","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_04bc7fa4-67f1-4db3-bd8a-27bb819bbbda.jpg?v=1739658346"},{"product_id":"v1785codcanb","title":"V.17:11 (85-92) Coding Candlesticks by Victor Likhovidov","description":"Coding Candlesticks by Victor Likhovidov\u003cbr\u003e\u003cbr\u003eJapanese candlestick charting is a popular method with which to visualize market price dynamics. Usually, candlestick charting is used in concert with other indicators to gauge market activity, but as a quantitative approach, technical analysis would be best served with quantitative rules for reading candlestick charts. Heres a simple method by which to assign digital codes to candlesticks. Youll see that the codes agree with the basic principles of technical analysis and may be used to construct a class of new indicators. My coding scheme is built on the common interpretation of candlestick charts. In particular:\u003cbr\u003e\u003cbr\u003eThe color of the candlestick is its most important characteristic, so it has the highest weight in the code. White candles are bullish and black candles are bearish.\u003cbr\u003e\u003cbr\u003eThe opening and closing prices of the candlestick are the most important of its four levels (open, high, low,close), and this is reflected in that the size of a candlesticks body corresponds to the positions of the binary code directly after its color.\u003cbr\u003e\u003cbr\u003eThe weight of each candlesticks element (body, upper shadow, lower shadow) depends on its size.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133938004337,"sku":"\\V17\\C11\\085CODI.PDF","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_96a12ddd-4d10-4ff9-89d0-1f122bf9aedd.jpg?v=1739658351"},{"product_id":"v139stocbyst","title":"V.17:9 (392-398): Stochastics by Stuart Evens","description":"Stochastics\u003cbr\u003e\u003cbr\u003eAs originally introduced by George Lane, the classic stochastic\noscillator is not a normalized relative strength indicator,\nlike most other momentum oscillators. However, it\ndoes use closing price in its calculation, but in a way slightly\ndifferent from other oscillators. Heres a refresher for the\nveteran traders and an introduction for the novices.\u003cbr\u003e\u003cbr\u003eThe stochastics oscillator was\noriginally introduced by George\nC. Lane in STOCKS \u0026amp; COMMODITIES\nin 1984. Since then,\nit has become a popular indicator,\nincluded in most technical\nanalysis software programs.\nThat, combined with the wide-spread\nuse of the personal computer,\nhas made stochastics an\neasy indicator to use.\nTo gain a more complete understanding of the oscillator,\nlets look at the idea behind stochastics, then at how it is\ncalculated and interpreted. (To examine historical results\nfrom backtesting the indicator on a number of securities, see\nsidebar, Historical testing in stochastics.)","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133939478897,"sku":"\\V17\\C09\\067STOC.PDF","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_d2e9e88b-c906-4d71-b366-1d2bc83b4c8e.jpg?v=1739658450"},{"product_id":"v150trigyour","title":"V.17:11 (507-509): Triggering Your Trading Signal by Benjamin L. Cotton","description":"Triggering Your Trading Signal by Benjamin L. Cotton\u003cbr\u003e\u003cbr\u003eHeres an indicator that calculates the future price movement necessary to trigger a moving average condition, removing the guesswork from systems trading based on such relationships.\u003cbr\u003e\u003cbr\u003eEvery trader has indicators to track the market with, but if the indicators are dependent upon a price that has yet to occur, the patience and time needed to track the entire body of stocks of concern to us can be tedious. Theres a way to get directly to what you want to know, which is what price will trip the indicators to generate a signal.\u003cbr\u003e\u003cbr\u003eFor example, a simple moving average crossover rule states: If the close crosses over the 30-day moving average of the close, then buy on close. Here, the two variables the close and the 30-day moving average converge to generate a signal. In this case, however, both variables depend on a closing price that has yet to occur. If youre going to trade this rule, it is risky to anticipate the exact price necessary for a signal to be triggered, especially if the relationship were more complicated say, buy on close when a five-day moving average crosses over a 10-day moving average. An indicator that computes this target price, or bogie in Air Force parlance, makes determining the trigger much easier. Certainly, it beats plugging a best-guess price into your calculator repeatedly until a trade is simulated.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133940855153,"sku":"\/V17\/C11\/089TRIG.pdf","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_c1d52274-adac-4c0b-abc4-09e69e56d872.jpg?v=1739658557"},{"product_id":"v125howsmoot","title":"V.17:6 (251-256): How Smooth Is Your Data Smoother? by Patrick E. Lafferty","description":"How Smooth Is Your Data Smoother? Traders use moving averages to remove random fluctuations from price data. Some moving averages work better than others. Take a look. In 1995, I wrote an article for STOCKS \u0026amp; COMMODITIES presenting some of the properties of three methods for removing random noise from financial time series. I discussed the lags between the turning point of a simple test data sequence and the turning points of three types of moving averages. I showed that for equal moving average periods, the three moving averages had markedly different lag characteristics. Specifically, for each period, an endpoint moving average (EPMA) had a smaller lag than an exponential moving average (EMA), and both the EPMA and EMA had smaller lags than the corresponding simple moving average (SMA). While it is important to define the lag characteristics of a data smoother, there is another, even more basic, question that must be addressed about the performance of the smoothing function. How smoothly does the smoothing function smooth the data?","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133944525169,"sku":"\\V17\\C06\\039SMOO.pdf","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_79dc5380-afb6-4325-ae84-9d390ee9ad22.jpg?v=1739658769"},{"product_id":"v126pseudsec","title":"V.17:6 (260-266): Pseudo Securities For Technical Analysis by Charles E. Miller","description":"\u003cp\u003ePseudo Securities For\u003cbr\u003e\nTechnical Analysts\u003cbr\u003e\nAs you develop your analytical skills, you probably pick a\u003cbr\u003e\nfavorite market to study. So depending on the market, you\u003cbr\u003e\ncould come to different conclusions about the value of different\u003cbr\u003e\ntechniques of analysis. With that in mind, what if you used\u003cbr\u003e\nartificial data with distinct properties as a basis for learning\u003cbr\u003e\nthe attributes of technical methods? In this, the first of a threepart\u003cbr\u003e\nseries, we explore the notion of using pseudo securities.\u003cbr\u003e\nThe objective of technical analysis\u003cbr\u003e\nis to locate securities with the\u003cbr\u003e\nnecessary volatility to make potentially\u003cbr\u003e\nprofitable round turns,\u003cbr\u003e\nand to predict, based on available\u003cbr\u003e\nhistorical data, suitable entry\u003cbr\u003e\nand exit points. Although the\u003cbr\u003e\nchart of the fictitious Omniscient,\u003cbr\u003e\nInc. [OICT], shown in\u003cbr\u003e\nFigure 1 suggests it is a reasonable candidate, each technician\u003cbr\u003e\nwill have his or her own approach to predicting price movements.\u003cbr\u003e\nSupport lines, channels, indicators which would be\u003cbr\u003e\nthe correct tool?\u003c\/p\u003e","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133962842481,"sku":"\\V17\\C06\\041PSEU.PDF","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_67e3421f-0a67-42ad-b09e-3f2ac83526a2.jpg?v=1739658989"},{"product_id":"v113ratforma","title":"V.17:3 (138-143): A Rationale For Managed Futures by Charles R. Lightner","description":"A Rationale For Managed Futures\u003cbr\u003e\u003cbr\u003eby Charles R. Lightner\u003cbr\u003e\u003cbr\u003eAlthough the futures markets are widely misunderstood even\namong knowledgeable investors, they serve a critical purpose\nin our economy; through the managed futures industry,\nthey provide an important investment opportunity for both\ninstitutions and individuals, and they need not expose the\ninvestor to unreasonable levels of risk.\u003cbr\u003e\u003cbr\u003eStocks, bonds, and real estate are\nthe largest and best-known types\nof investments in our economy.\nThey have distinctly different\ninvestment characteristics, and\neach has a specific effect on an\ninvestment portfolio. Over the\npast 20 years, the products of\nthe managed futures industry,\nwhich invests in the global futures\nmarkets, have also been\nshown to have unique, important,\nand beneficial effects when added to investment portfolios.\nManaged futures may represent the smallest of the\nalternative asset classes, but its characteristics are becoming\nbetter and better known and its value in an investment\nportfolio is becoming increasingly clear. Heres a brief look\nat why managed futures perform as they do and how they can be understood in the context of the economic purpose served\nby the futures markets.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133967364465,"sku":"\\V17\\C03\\022RATI.PDF","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_7f1c1749-a948-49f2-b86b-2534a04d77fe.jpg?v=1739659299"},{"product_id":"v1712letters","title":"V.17:12: Letters","description":"Letters to S\u0026amp;C\u003cbr\u003e\u003cbr\u003eFour pages of letters to the editor relating to technical analysis and this magazine. This column is our means of communication with our readers.\u003cbr\u003e\u003cbr\u003eSome of this month's letters are on the following topics: EXCEL CODE FOR TREND-FOLLOWING\nMETHOD, COSINE-WEIGHTED MOVING AVERAGE, and THE VAP INDICATOR.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133967495537,"sku":"\/V17\/C12\/12LET.pdf","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_a476e063-d9b3-48c6-9126-e358c4f771c5.jpg?v=1739659309"},{"product_id":"v124sizfuttr","title":"V.17:5 (241-245): Sizing A Futures Trading Account by Jay Kaeppel","description":"Sizing A Futures\nTrading Account\nby Jay Kaeppel\u003cbr\u003e\u003cbr\u003eWhile most traders start out working on a trading system,\nthey forget that the amount of starting capital is equally\nimportant. Here are some guidelines to consider.\u003cbr\u003e\u003cbr\u003eNovice traders focus their attention\non developing a system for\nentering and exiting the markets.\nIn fact, an entire industry has\nbeen spawned to facilitate trading\nsystem development. The\nage-old quest for the Holy Grail\nfuels the simplistic attitude\namong new traders that if their\ntiming is good enough, everything\nwill work out. Only after a\ntrader has become seasoned and\ntaken some hits does his or her attention become more focused\non money management. While money management is a broad\nsubject, one crucial topic sizing an account is key.\u003cbr\u003e\u003cbr\u003eBefore a trader can start trading a portfolio of different\ncontracts, he or she should determine how much capital is\nneeded. Unfortunately, topics such as sizing an account tend\nto be an afterthought for most new traders until, that is,\nthey suffer a drawdown of frightening or ruinous proportions.\u003cbr\u003e\u003cbr\u003eTHREEFOLD DANGER\u003cbr\u003e\u003cbr\u003eThe dangers in failing to size an account properly are three-fold:\nThe first and greatest danger is that you might tap out\n(that is, lose all your money). Consider the naive trader who\nopens an account with $20,000 and begins trading a group of\nmarkets using the trading system he spent hundreds of hours\ndeveloping. While the trader has total confidence in the buy\nand sell signals generated by the system, he fails to do enough\nhomework regarding expected equity swings. He doesnt\nknow that the portfolio\/system combination routinely experiences\nequity swings of $15,000. Of course, he could get\nlucky, start making money right off the bat, and then be able\nto sit through a subsequent $15,000 drawdown. Its more\nlikely, however, he will suffer a $15,000 drawdown at some\npoint and stop trading altogether because he was not prepared\nfinancially for the huge percentage swings in equity.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133970936177,"sku":"\\V17\\C05\\037SIZE.PDF","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_9b81738c-ec89-421c-a2a7-ab53bb4b2d69.jpg?v=1739659566"},{"product_id":"v118inholgra","title":"V.17:4 (186-192): Interview: The Holy Grail Of Trading Is Within Us All: Van K. Tharp by Thom Hartle","description":"The Holy Grail Of Trading Is Within Us All: Van K. Tharp, Ph.D.\u003cbr\u003e\u003cbr\u003ePsychologist and trading coach Van K. Tharp is the president of the\nInternational Institute of Trading Mastery, Inc. He has spent the last 15\nyears working with more than 4,000 traders, and through this work, he has\nmanaged to identify themes and characteristics that are key among successful\ntraders. Hes developed a home study course on the trading process, but\nhis recent work has to do with the psychology of system development. He has\nwritten a book titled Trade Your Way To Financial Freedom, in which he\nanalyzes how great traders develop their systems and how they stay great.\nSTOCKS \u0026amp; COMMODITIES Editor Thom Hartle and Tharp used E-mail to\nconduct this interview during the week of January 28, 1999, discussing the\nimportance of understanding your own belief systems and position sizing,\nand determining the steps to designing your own system.\u003cbr\u003e\u003cbr\u003eThe Holy Grail does exist, but it is an inner search. And\nonce youve undertaken that quest, learn position sizing\nstrategies. When you can understand how position sizing\napplies to your trading system, then you have a chance.\n Van K. Tharp","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133972509041,"sku":"\\V17\\C04\\029INT.PDF","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_8cb4aab1-3de7-48b6-9271-3532668d23b3.jpg?v=1739659669"},{"product_id":"v153kelchanb","title":"V.17:12 (533-538): Keltner Channel by Stuart Evens","description":"Keltner Channels by Stuart Evens\u003cbr\u003e\u003cbr\u003eThere are many different ways of constructing channels, and one of the more basic, though less well-known, methods is the Keltner channel. Take a look.\u003cbr\u003e\u003cbr\u003eThe Keltner channel technique, which was first presented in 1960, is not generally as well known as other channel methods. In fact, while doing research for this article, I had a difficult time finding many references on the subject, and I personally have never used Keltner channels to trade. Therefore, I decided to get a feel for the Keltner method by comparing it to other, more widely used methods of channel construction. I will first examine the basics of fixed-width envelopes, Bollinger Bands, STARC bands, and Keltner channels, going into more detail for Keltner. Ill look at how each method responds to the daily price bar activity for the same stock, Apple Computer [AAPL], during the same period. Ill then compare the historically backtested results for each of the data from Dial Data.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133972640113,"sku":"\/V17\/C12\/095KELT.pdf","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_0c4f2b83-b48e-468f-9b2d-01fa70def781.jpg?v=1739659678"},{"product_id":"v133ibmcubby","title":"V.17:8 (335-342): IBM, Cubed by Dennis Meyers, Ph.D.","description":"IBM, Cubed\u003cbr\u003e\u003cbr\u003eHeres a look at whats involved in developing a\ntrend-following indicator for trading IBM.\u003cbr\u003e\u003cbr\u003eIn a previous article, I showed\nhow the application of a curve\ngeneratedbyathird-degreepoly-nomial\ncould be used to develop\na system to buy and sell British\npound (BP) futures. This time,\nwe will use a variation of that cubed system to create a system to trade IBM.\nIBM, one of the premier computer corporations in\nthe world, is a major factor in the movement of the\nDow Jones and Standard \u0026amp; Poors 500 indices.\nAlthough IBM is traded on all regional exchanges, the\nlions share and real market of IBM is traded on the\nNew York Stock Exchange (NYSE).\u003cbr\u003e\u003cbr\u003eDATA DISCUSSION\nWe will use the daily prices of IBM from January 1,\n1993, to December 31, 1998. IBM pays dividends on\na quarterly basis, usually on the dividend payable\ndates of March 10, June 10, September 10, and\nDecember 10. On the exdividend date, the price of\nthe stock is adjusted down by the value of the dividend.\nThus, over the space of a year IBM has a small\ndownward bias in price by the amount of the yearly\ndividend.Ifyou wereaholderof IBM,thenyouwould\nreceive those dividends in cash, and the small downward\nbias over the year would be made up by the cash\ndividends you received. However, in developing a\nsystem using IBM prices,those pricesarenotadjusted\nfor the dividend payments. This nondividend adjustment\ncreates a small distortion in parameter selection\nand walk-forward results, which should be noted but\ndoes not significantly affect the system.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133974278513,"sku":"\\V17\\C08\\056IBM.PDF","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_1592f64a-4e19-4e0b-b974-7a63edbe4d96.jpg?v=1739659799"},{"product_id":"v128sysfortr","title":"V.17:7 (289-297): A System For Trading Fidelity Select Funds by Jay Kaeppel","description":"A System For Trading Fidelity Select Funds by Jay Kaeppel\u003cbr\u003e\u003cbr\u003eThe key techniques for trading stocks, options, and\nfutures can also be applied successfully to mutual\nfunds. Heres a systematic approach to mutual fund\ntrading.\u003cbr\u003e\u003cbr\u003eSeveral keys to investment and\ntrading success are universal;\nthese keys apply to stock, futures,\nand options trading, and\nthey also apply to trading mutual\nfunds. The first key is to\nidentify opportunities with\nabove-average profit potential.\u003cbr\u003e\u003cbr\u003eThe second is to determine how\nbest to take advantage of those\nopportunities without taking on too much risk. Achieving\nthe proper balance is of paramount importance; if\nyou never take enough risk, you never allow yourself\nthe opportunity to achieve above-average gains. Conversely,\nif you take on more risk than you can handle,\neventually you will find yourself bailing out at the\nwrong time. The mutual fund trading system I will\nexamine is designed to achieve such a balance.\u003cbr\u003e\u003cbr\u003eThe Fidelity family of funds offers a unique set of\nopportunities via their Select group of funds. Each\nSelect fund concentrates its portfolio in a specific\nindustry group or sector for example, brokerage,\ndefense, health care, regional banks, and airlines, to\nmention only a few. These funds offer investors\nunique opportunities as well as unique risks.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133976211825,"sku":"\\V17\\C07\\047SYST.PDF","price":4.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_905a50f9-2f06-41da-bd24-be90cc0cd3f6.jpg?v=1739659924"},{"product_id":"v174letters","title":"V.17:4: Letters","description":"LETTERS TO S\u0026amp;C\u003cbr\u003e\u003cbr\u003eThe editors of S\u0026amp;C invite readers to submit their opinions and information on subjects\nrelating to technical analysis and this magazine. This column is our means of communication\nwith our readers. Is there something you would like to know more (or less) about? Have you\nrun across trading techniques, services or products that have proved useful? Tell us about\nit. Without a source of new ideas and subjects coming from our readers, this magazine would\nnot exist.\u003cbr\u003e\u003cbr\u003eAddress your correspondence to: Editor, STOCKS \u0026amp; COMMODITIES, 4757 California Ave.\nSW, Seattle, WA 98116-4499, or E-mail to editor@traders.com. Letters published may be\nedited for length or clarity. The opinions expressed in this column do not necessarily\nrepresent those of the magazine.Editor\u003cbr\u003e\u003cbr\u003eMOVING AVERAGES AND CYCLES\u003cbr\u003e\u003cbr\u003eEditor,\u003cbr\u003e\u003cbr\u003eBrian J. Millards February 1999 S\u0026amp;C\narticle Moving Averages, First Principles\non moving averages fails to address\nimportant issues that arise when\nmoving averages (MA) are used in cyclical\nmodels. E. Slutskys 1937 article\nEconometrica told us that the moving\naverage transformation may induce the\nappearance of cycles where none exist\nin random data.\u003cbr\u003e\u003cbr\u003eOne practical approach may be to use\na second, different transformation to\ndetermine if a cycle with the same characteristics\n(wavelength, amplitude,\nphase) can be discerned in the data.\nExamining the closing price at the end\nof each week or the average closing\nprice (or first differences, as Millard\nsuggests) in each week are possible\nalternatives. Another strategy for those\nwith deeper mathematical skills is to\napply power spectrum analysis, which\ndecomposes the variation in data into\nthe sum of cycles, each with differing\ncharacteristics. Spectral analysis may\nconfirm the existence of cycles with\ncharacteristics similar to those shown\nusing the MA transformation.\u003cbr\u003e\u003cbr\u003eFurther, cycles sometimes appear in\ndata transformed by MAs because of\njust a few outliers or extreme values\nabove and below the trendline. Plotting\nthe raw data against the moving\naverage data may reveal whether just a\nfew datapoints are involved or whether\nmore pronounced, smoother cycles\nexist in the raw data. If in fact the\ncycles are caused by just a few outliers,\nthen entry and exit strategies must be\nmore carefully considered. To the extent\nthat more pronounced cycles can be discerned\nin the untransformed data, timing\nmay be easier.\u003cbr\u003e\u003cbr\u003eROBERT PHILIP WEBER, Ph.D.\nvia E-mail","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133979652465,"sku":"\\V17\\C03\\04LET.PDF","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_0eeb41d4-6fd7-43a6-8284-bf8c4b9df235.jpg?v=1739660167"},{"product_id":"v111bolbanby","title":"V.17:3 (116-123): Bollinger Bands by Stuart Evens","description":"Bollinger Bands\u003cbr\u003e\u003cbr\u003eby Stuart P. Evens\u003cbr\u003e\u003cbr\u003eThis indicator combines popular technical methods moving\naverages, support\/resistance, and envelopes with\nstatistical analysis to create a powerful technical analysis\ntool. Bollinger Bands, used in combination with the relative\nstrength index (RSI) to analyze a market, enables us to\ndevelop a method to enter and exit trades and review the\nhistorical results.\u003cbr\u003e\u003cbr\u003eOn a day-to-day basis, markets\ntrade in a volatile fashion\naround the trend. To better see\nthe trend, traders use moving\naverages to filter the price action.\nThis way, traders can\ngather important information\nregarding how the market is\ntrading. For example, after a\nsharp rise or fall in the trend,\nthe market may consolidate,\ntrading in a narrow fashion and crisscrossing above and\nbelow the moving average. To better monitor this behavior,\ntraders use price channels, which are designed to encompass\nthe trading activity around the trend.\u003cbr\u003e\u003cbr\u003eBollinger Bands are one such technical tool. Before we\ndiscuss Bollinger Bands, however, lets have a quick look at\nsome other methods that traders have used.\u003cbr\u003e\u003cbr\u003eSome technicians use moving averages with support and\nresistance lines to anticipate the price action of a stock. Upper\nresistance and lower support lines are first drawn and then\nextrapolated to form channels within which the trader expects\nprices to be contained. Some traders draw straight lines\nconnecting either tops or bottoms of prices to identify the\nupper or lower price extremes, respectively, and then add\nparallel lines to define the channel within which the prices\nshould move. As long as prices do not move out of this\nchannel, the trader can be reasonably confident that prices are\nmoving as expected.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133983912305,"sku":"\\V17\\C03\\019BOLL.PDF","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_06f9773b-a589-4a78-ae1b-28524c2e98ef.jpg?v=1739660413"},{"product_id":"v143inshocby","title":"V.17:1 (43-45): In Shock by Adrienne Laris Toghraie","description":"In Shock\u003cbr\u003e\u003cbr\u003eby Adrienne Laris Toghraie\u003cbr\u003e\u003cbr\u003eTrading is unique in that the uncertainty of the markets\nbrings to bear an unusual stress level. What should you do if\nyour trading suddenly turns south, or worse, a tragic event\noccurs?\u003cbr\u003e\u003cbr\u003eRecently, I was in an automobile\naccident when a cab driver sped\nthrough a four-way stop sign as\nI was entering the intersection.\nFor a spell, I felt lost in time. In\nthat moment of unreality, I even\nthought that it was all a dream.\nI was in shock.\nWhat is shock? According to\nthe dictionary, it can be a sudden,\njarring impact or the result of a disturbance in your\nequilibrium; it can also be the reaction to a strike with\nsurprise, terror, or horror.\u003cbr\u003e\u003cbr\u003eTraumatic events can cause a state of shock. In the best of\nall circumstances, a person can go through life without one,\nbut such a utopian existence is unlikely. Since successful\ntrading depends on good performance, it is important that a\ntrader have plans in case of any disastrous event. Being\nunprepared could be very costly, both emotionally and financially.\nWhether it is the resulting shock from an accident or\nthe shock of realizing that your trading account has been\nwiped out by the markets and theres nothing you can do\nabout it, its still the same: Disaster has occurred, and you\ncouldnt control it.\u003cbr\u003e\u003cbr\u003eLETTING GO\u003cbr\u003e\u003cbr\u003eImmediately after the accident, I just sat in my car, trying to\nfigure out whether the next world war had started. A concerned\nface popped up and asked how I was. For a split\nsecond, I just wanted to say, Obviously, Im not okay! But\nall I could say was, I dont know. The one thing I did know,\nhowever, was that it was time for me to let others take control.\nWhen you are in a state of shock, it is the best time to make\nno choices, if possible. First, seek out a helpful person with\nwhom you feel comfortable and allow him or her to make\nimmediate decisions for you. When something disastrous has\nhappened in your trading and you are in a state of shock, you\nneed to know who you can trust to make the decisions that\nhave to be made. For me, it was the paramedics, the police and\nmy assistant.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133984141681,"sku":"\\V17\\C01\\005SHOC.PDF","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_09294860-d127-476e-a4a4-78b43a104217.jpg?v=1739660430"},{"product_id":"v173letters","title":"V.17:3: Letters","description":"LETTERS TO S\u0026amp;C\u003cbr\u003e\u003cbr\u003eThe editors of S\u0026amp;C invite readers to submit their opinions and information on subjects\nrelating to technical analysis and this magazine. This column is our means of communication\nwith our readers. Is there something you would like to know more (or less) about? Have you\nrun across trading techniques, services or products that have proved useful? Tell us about\nit. Without a source of new ideas and subjects coming from our readers, this magazine would\nnot exist.\u003cbr\u003e\u003cbr\u003eAddress your correspondence to: Editor, STOCKS \u0026amp; COMMODITIES, 4757 California Ave.\nSW, Seattle, WA 98116-4499, or E-mail to editor@traders.com. Letters published may be\nedited for length or clarity. The opinions expressed in this column do not necessarily\nrepresent those of the magazine.Editor\u003cbr\u003e\u003cbr\u003eNOVICE TRADER SERIES\u003cbr\u003e\u003cbr\u003eEditor,\nIts a great idea that STOCKS \u0026amp; COMMODITIES\nincludes the Novice Trader\narticles. You will surely gain more new\nreaders with the series while not losing\nthe current ones. Id like to suggest that\nin your future issues, you may want to\npresent such topics as Fibonacci, Elliott\nwave, and Dow theory basics.\nIm not a security- or investment-related\nprofessional, but I like to trade.\nBeing a daytrader is out of the question\nfor me, but I want to catch intermediate\nup- and downtrends. Can you recommend\nsoftware that is not too costly and\nthat has good charting capabilities and\nindicators for weekly (not daily or\nmonthly) stock and index trends?\nRICHARD ZHU\u003cbr\u003e\u003cbr\u003eThanks for your suggestions. Regarding\nour novice articles, we have recently\nadded a Staff Writer, which will\nallow us to run more of the articles like\nthe ones you mention. With regard to\nsoftware, we publish product reviews\neach month. In addition, our 1999 Bonus\nIssue, available only to subscribers,\ncontains our Readers Choice\nAwards for favorite technical analysis\nsoftware, and our Website contains the\nSoftware Comparison Table, which details\nsoftware features. We cant recommend\nindividual products to each of our\nreaders because everyones needs and\nbudgets are different, but we try to provide\nas much information as we can to\nhelp you narrow down your choices.\nEditor","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133984239985,"sku":"\\V17\\C03\\03LET.PDF","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_1873a861-6257-4ed7-a635-840c8bebc7f3.jpg?v=1739660438"},{"product_id":"v112maxfavex","title":"V.17:3 (124-127): The Maximum Favorable Excursion Strategy by D. Stendahl and L. Zamansky","description":"The Maximum Favorable\nExcursion Strategy\u003cbr\u003e\u003cbr\u003eby David C. Stendahl and Leo J. Zamansky\u003cbr\u003e\u003cbr\u003eMaximum favorable excursion (MFE) is the peak profit that\na trade earns before the trade is closed out. Reviewing the\nperformance of a trading system allows us to measure the\ntendency of the MFE of the trades. This article explains how\nto use the information to enhance profitability.\u003cbr\u003e\u003cbr\u003eMaximum favorable excursion\n(MFE), a concept originally created\nby John Sweeney to mea-sure\nthe distinctive characteristics\nof profitable trades, can be\nused as part of an analytical\nprocess to enable traders to distinguish\nbetween average trades\nand those that offer substantially\ngreater profit potential.\nUsing MFE analysis, traders can classify above-average performance\nduring a trade and thereby recognize opportunities\nto enhance profitability with the MFE risk management\nstrategy.\u003cbr\u003e\u003cbr\u003eFollowing the strategy, traders can increase profit potential\nrelative to risk by adding to positions based on the trading characteristics of a system. This strategy can be used with all\nsystems, whether they are mechanized, discretionary, long,\nshort, intraday, or end of day. The returns of the system must,\nhowever, exhibit certain characteristics to take advantage of\nthis risk management strategy.\u003cbr\u003e\u003cbr\u003eSince every trading methodology is different, it will take a\nthorough performance evaluation to determine if the MFE\nstrategy is suitable for the system.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133988434289,"sku":"\\V17\\C03\\020MAX.PDF","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_85efcec9-9b0f-41f3-8781-3525b3e7012f.jpg?v=1739660728"},{"product_id":"v113multimfr","title":"V.17:1 (13-22): Multiple Time Frame Trading Using Swing Channels by Robert Krausz, MH, BCHE","description":"Multiple Time Frame Using Swing Robert Krausz, who was featured in Jack Schwagers\nNew Market Wizards, follows up his previous article\non the new Gann swing chartist with a detailed\npresentation on using channels for setting up trading\nopportunities.\u003cbr\u003e\u003cbr\u003eIn my previous article on dy-namic\nmultiple time frames, I\nintroduced one of my own ap-proaches\nto trading: The con-cept\nof multiple time frame trad-ing.\nThe essence of the strategy\nis easy: Use the higher time frame\nprice activity to define the trad-able\ntrend as well as potential\nsupport and resistance levels. For example, if you are\ntrading the Treasury bond futures contract and you\nfollow the market using 50-minute bars, then look to\nthe daily bars activity to indicate the trend and\nsupport and resistance levels.\nThe same idea applies if you are trading a stock on\na daily basis say, Microsoft in which case, the\nweekly bars will be the basis for the trend as well as\nthe important support and resistance points. That is\nthe foundation of multiple time frame trading.\nBesides the effectiveness of using a method based\non a multiple time frame approach, another advan-tage\nis the method need not be complicated. A trader\ncan make his or her method as simple or as compli-cated\nas desired. For me, though, the simpler the\napplication, the better the results.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133990826353,"sku":"\\V17\\C01\\001MULT.PDF","price":4.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_a4a75163-7e86-47ee-8bb3-a3c74bb9bfbc.jpg?v=1739660881"},{"product_id":"v175letters","title":"V.17:5: Letters","description":"LETTERS TO S\u0026amp;C\u003cbr\u003e\u003cbr\u003eThe editors of S\u0026amp;C invite readers to submit their opinions and information on subjects\nrelating to technical analysis and this magazine. This column is our means of communication\nwith our readers. Is there something you would like to know more (or less) about? Have you\nrun across trading techniques, services or products that have proved useful? Tell us about\nit. Without a source of new ideas and subjects coming from our readers, this magazine would\nnot exist.\u003cbr\u003e\u003cbr\u003eAddress your correspondence to: Editor, STOCKS \u0026amp; COMMODITIES, 4757 California Ave.\nSW, Seattle, WA 98116-4499, or E-mail to editor@traders.com. Letters published may be\nedited for length or clarity. The opinions expressed in this column do not necessarily\nrepresent those of the magazine.Editor\u003cbr\u003e\u003cbr\u003eVOLATILITY INDICATOR\u003cbr\u003e\u003cbr\u003eEditor,\u003cbr\u003e\u003cbr\u003eThe September 1998 article Trading\nThe Trend by Andrew Abraham, in\nwhich he presented a volatility indicator,\ndoesnt provide the information\nnecessary for the educated layman who\nis interested in technical analysis. In\nmy opinion, it should have provided\nmore detail on some areas.\u003cbr\u003e\u003cbr\u003eI understand the calculation of a 21-\nperiod weighted average of the true\nrange, but why is the final value multiplied\nby 3? Is the volatility indicator in\na rising market calculated by subtracting\nthe 21-period weighted average of\nthe true range from the highest close in\nthe same 21-period?\u003cbr\u003e\u003cbr\u003eThen when the market closes below\nthe volatility indicator, is the volatility\nindicator calculated by adding the next\ndays value of the 21-period weighted\naverage of the true range to the lowest\nclose in the 21 periods? I hope you can\nclarify this for me.\u003cbr\u003e\u003cbr\u003eTONY RAMSELAAR, via E-mail\u003cbr\u003e\u003cbr\u003eWeert, The Netherlands\u003cbr\u003e\u003cbr\u003eThe volatility indicator discussed by\nAbraham in the article was originally\nintroduced by J. Welles Wilder in New\nConcepts In Technical Trading, published\nby Trend Research in 1978, available\nfrom the Delta Society (336 698-\n0500). Wilder explains that the constant\nused in the volatility system can\nrange from 2.80 to 3.10 and was found\nby testing. The volatility indicator is a\ntrailing stop-and-reverse approach.\nThe volatility indicator is the average\ntrue range multiplied by the constant\nand subtracted from the highest close\nfor long positions. Thus, if you are\nlong, you should go short if the market closes below the volatility indicator.\nWhile you are short, the volatility indicator\nis added to the lowest close, and\nyou go long if the market closes above\nthe volatility indicator.\u003cbr\u003e\u003cbr\u003eI hope this helps to fill in the gaps for\nyou.Editor","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133990957425,"sku":"\\V17\\C05\\05LET.PDF","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_c5aecd10-8c7b-426e-b7c2-6cb5e28710f7.jpg?v=1739660888"},{"product_id":"v154canfilby","title":"V.17:12 (548-551): Candlestick Filtering by Rudy Teseo","description":"Candlestick Filtering by Rudy Teseo\u003cbr\u003e\u003cbr\u003eUsing candlestick patterns alone to generate buy and sell signals may be risky. Combining them with confirming indicators can greatly increase reliability. Take a look.\u003cbr\u003e\u003cbr\u003eFew candlestick patterns can stand alone without confirmation of some kind. It is extremely risky to trust buy and sell signals based solely on these patterns.\nYou can diminish some of the uncertainty, though, by filtering the candlesticks signals, using other indicators to confirm buy or sell signals.\u003cbr\u003e\u003cbr\u003eIn the case of candlesticks, the question arises: What to use for confirmation? For an answer, consider this: candlestick patterns are merely a different form of chart pattern. Candlesticks and standard price bars display exactly the same information open, high, low, and\nclose. Therefore, any indicators you are currently using on bar charts can be used to confirm the candlestick pattern. This is the essence of my filtering process.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133992169841,"sku":"\/V17\/C12\/CAND.pdf","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_233d031c-92db-4b1d-90ed-f9864e4444fa.jpg?v=1739660980"},{"product_id":"v110movavfir","title":"V.17:2 (101-106): Moving Averages, First Principles by Brian J. Millard","description":"Moving Averages,\nFirst Principles\u003cbr\u003e\u003cbr\u003eBy Brian J. Millard\u003cbr\u003e\u003cbr\u003eDont quite understand moving averages, but think that you\ncould benefit from using them? Heres how to understand\nand apply moving averages to identifying trends in stocks.\u003cbr\u003e\u003cbr\u003eOf all the technical indicators,\nmoving averages are perhaps\nthe most widely used and misunderstood.\nIncorrectly applied,\nas is usually the case, they may\nbe responsible for more losses\nthan any other indicator. Correctly\napplied, however, they\ncan be the most versatile and\npowerful tools available. The\nreasons for failure? First, a poor\nunderstanding of how stock\nprices move, and second, a poor understanding of the\nproperties of moving averages.\u003cbr\u003e\u003cbr\u003eIt is important to note that if the user does not attempt to\nunderstand how prices move, then applying any indicator is\na haphazard affair. Indicators tend to be developed by trial\nand error, and without a clear understanding of how they\nwork, using them can lead to disappointing and disastrous\n results.\u003cbr\u003e\u003cbr\u003eSTOCK PRICE MOVEMENT\u003cbr\u003e\u003cbr\u003eThe point-to-point movement model is based partly on the\none put forward by analyst J.M. Hurst a number of years ago\nand partly on my own research. In this model, stock movement\nis considered to be composed of random point-to-point\nmovement and complex cyclic movement. Point-to-point\nmovement is simply a generalization of the sampling interval\nand refers to the change between one data point and the next,\nsuch as tick-to-tick, day-to-day, and week-to-week, as\nwell as others.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133993742705,"sku":"\\V17\\C02\\016MOV.PDF","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_3004bd24-9074-48d2-93de-f750c9b3102e.jpg?v=1739661107"},{"product_id":"v135whatmart","title":"V.17:8 (355-357): What Market Timing Is - And Isn't by Paul A. Merriman","description":"What Market Timing Is \nAnd Isnt\u003cbr\u003e\u003cbr\u003eMarket timing is supposed to be great at reducing your risk\nwhile letting you profit in the bull moves, but is it all its\ncracked up to be? This market timer discusses the pros and\ncons.\u003cbr\u003e\u003cbr\u003eMarket timing and market timers\n are often treated in the\nmedia as barely a step above\nsnake-oil salesmen. Its easy to\nbecome defensive in response.\nBut confession is good for the\nsoul. So heres an insiders look\nat what timing is and isnt.\nI could claim that market timing\nhas a big impact on long-term\nreturns. But it doesnt; timing\nis much less important than\nasset allocation. In the long run,\na broadly diversified buy-and-hold equity portfolio has pretty\nhigh odds of achieving a 12% compound return. Timing may\nimprove that but you cant count on it. The biggest way\ntiming adds value is by offering a smoother ride, trying to\navoid or minimize interim losses that result from volatility.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52133995348337,"sku":"\\V17\\C08\\059WHAT.PDF","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_2cce9730-e0dd-4658-9c21-6b174621c9fa.jpg?v=1739661224"},{"product_id":"v120smarmonb","title":"V.17:5 (209-214): Smart Money by Scott Brown","description":"Smart Money by Scott Brown\u003cbr\u003e\u003cbr\u003eShould you develop a personal trading system, one that\nreflects your own personality?\u003cbr\u003e\u003cbr\u003eA belief persists among investors\nthat a select group of traders\nhave the inside edge. Some indicators,\nsuch as The Commitment\nOf Traders Report, try to\ntrack the activities of these traders.\nSome recent research may\nshed light on the composition\nof this group, as well as the\ntechniques that the Market\nWizards use to consistently\nbeat the market. Once the market participant understands the\nareas that make a difference, he can use this knowledge to\nimprove his trading performance.\u003cbr\u003e\u003cbr\u003eMARKET VOLATILITY\u003cbr\u003e\u003cbr\u003eTrading the markets is a social phenomenon. Investors are also\ngreatly influenced by mass psychology. This could explain\ntrendlines of markets in the limelight that have dramatic shifts in\nslope. An excellent example is the petroleum futures bubble at\nthe end of 1990 that was sparked by the Gulf War (Figure 1).\nIt could also explain stocks in low-volatility channels despite\nfavorable earnings, growth and dividends at the end of bear\nmarkets when public interest is low.\u003cbr\u003e\u003cbr\u003eEFFICIENT MARKET HYPOTHESIS\u003cbr\u003e\u003cbr\u003eRandom walk, or efficient market hypothesis (EMH), contends\nthat past, present and future prices accurately reflect\ninformation coming into the market. Economist Robert Shiller\nof Yale University is one of the leading challengers of\nstandard EMH. He emphasizes the role that popular opinion\ncould play in volatility. Shillers research indicates there is\nmore volatility in the market than the EMH model can account\nfor; price may not always reflect value.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52134000394609,"sku":"\\V17\\C05\\032SMAR.PDF","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_a1a7bcf1-93b2-46dd-a131-15612e9a28c8.jpg?v=1739661579"},{"product_id":"v128tradtip","title":"V.17:6 (284-286): Traders' Tips","description":"METASTOCK\nIn the May 1998 issue of STOCKS \u0026amp; COMMODITIES, a Traders\nTip provided MetaStock formulas for calculating support\nand resistance levels and the WRO and WSO support and\nresistance oscillators. The Traders Tip was based on my\narticle, Automated Support And Resistance, also in that\nissue. Since then, Ive received many E-mail messages from\nSTOCKS \u0026amp; COMMODITIES readers about it.\u003cbr\u003e\u003cbr\u003eMETASTOCK\nHow Smooth Is Your Data Smoother? by Patrick E. Lafferty\nin this issue reviews different types of moving averages,\nincluding a sine-weighted moving average. The sine-weighted\nmoving average can easily be created in MetaStock 6.5 or\nhigher. In MetaStock, select Indicator Builder from the Tools menu.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52134000427377,"sku":"\\V17\\C06\\046TIPS.PDF","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_47b7dc85-6035-4207-8f2e-f890dca9b87b.jpg?v=1739661582"},{"product_id":"v142volstops","title":"V.17:10 (427-432): The Volatility Stop System by Mark Vakkur, M.D.","description":"The Volatility Stop System\u003cbr\u003e\u003cbr\u003eHeres a step-by-step through the development of a\nrobust trading system for capturing major market\nmoves.\u003cbr\u003e\u003cbr\u003eVolatility systems have a long\nand honored history in technical\ntrading. Here, Ill show you\na simple, robust version you\ncan use on a weekly basis. I\ninclude code in a sidebar and\nshow the results of optimizing\nthe system for the Dow Jones Industrial Average\n(DJIA), some stocks, and some mutual funds. The\nresults are good across the board.\nThe most robust systems adapt themselves to the\nmarket or security being traded. One indicator particularly\nwell suited to the intermediate-term trader\nor investor is what I refer to as the volatility stop. The\nvolatility stop is based on the idea that a trading stop\nshould be adjusted for an assets volatility, here\nmeasured as the average true range. (For more on\ntrue range, see the sidebar.)","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52134006358385,"sku":"\\V17\\C10\\075VOL.PDF","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_cd62f61e-aa28-4d4d-9942-7858202df8bb.jpg?v=1739661829"},{"product_id":"v150trianrev","title":"V.17:1 (50-54): Triangles: Reversal Or Continuation by Stuart Evens","description":"Triangles: Reversal\nOr Continuation\u003cbr\u003e\u003cbr\u003eby Stuart Evens\u003cbr\u003e\u003cbr\u003eLook at most any book on the subject of technical analysis,\nand youll come across triangles. These formations are usually\none of the first chart patterns that novice technicians study,\nand it deserves some examination.\u003cbr\u003e\u003cbr\u003eTriangles are classified as reversal\npatterns in some reference\nworks, while they are described\nas continuation patterns in others.\nRobert Edwards and John\nMagee, in their Technical\nAnalysis Of Stock Trends, have\na chapter titled Important Reversal\nPatterns The Triangles.\nJohn Murphy, on the\nother hand, in his Technical\nAnalysis Of The Futures Markets, has triangles as a subheading\nunder the chapter titled Continuation Patterns.\u003cbr\u003e\u003cbr\u003eOn reading these chapters on triangles, however, we find\nthat both works instruct the reader about triangles behaving\nas both reversal and continuation patterns. What is common\nto both discussions, and in fact most discussions on triangles,\nis that once triangles are properly identified, subsequent price\naction tends to react in predictable ways. What technicians\nhave found over the years is that after prices break out of the triangle pattern, it is highly probable that prices will continue\nmoving in that direction. Knowing this gives us the opportunity\nto trade in that direction, and to profit if we are correct.\u003cbr\u003e\u003cbr\u003eLets take a look at the different types of triangles, how\nthey are formed, what they look like, and how to draw them\non the price chart. Then well examine the subsequent behavior\nof the stock used as an example after prices break out of\nthe formation. Finally, well see how we can use the triangle\nto make trades based on our interpretation of the chart;\nprofitable trades, if our assessment of the pattern is correct.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52134007832945,"sku":"\\V17\\C01\\007TRI.PDF","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_d547abd5-376a-42c7-bdf5-6e90edc4b15a.jpg?v=1739661937"},{"product_id":"v1jan57prodr1","title":"V.17:13 Jan (577-579): Product Review: Option Simulator\/RT","description":"PRODUCT REVIEW: Option Simulator\/RT Version 3 by John Sweeney\u003cbr\u003e\u003cbr\u003eReal-time options analytics have slowly gotten more\navailable, presumably in response to consumer demand. As datafeeds have concurrently gotten better, the software on the receiving end has become more\nviable. Option Simulator\/Real Time from Bay Options is a hard-core frontrunner in this niche war.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52134007931249,"sku":"\/V17\/c13\/113PR.pdf","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_fbaad796-d9d7-4839-b20d-f243cd0b2b63.jpg?v=1739661945"},{"product_id":"v123seasadof","title":"V.17:1 (23-26): Seasonal Adjustment Of Time Series Data by George R. Arrington, Ph.D.","description":"Seasonal Adjustment\nOf Time Series Data\u003cbr\u003e\u003cbr\u003eby George R. Arrington, Ph.D.\u003cbr\u003e\u003cbr\u003e\nWhile time series data is the heart of most technical trading\nsystems, some have a tendency to reflect seasonal patterns;\nfor example, agricultural commodities tend to follow harvest\ncycles. Heres how to adjust data to see nonseasonal patterns\nmore clearly.\u003cbr\u003e\u003cbr\u003eTime series data, which is data\nsuch as most price and volume\ndata collected sequentially over\ntime and usually at fixed inter-vals,\nis the basic fuel for most\ntechnical trading systems. As\nnew data becomes available, it\nis used to recalculate the value\nof technical indicators. This, in\nturn, may trigger a trading sig-nal.\nTime series data often con-tains\na bias that reflects sea-sonal\npatterns; for example, prices of agricultural commodi-ties\ntend to follow harvest cycles and seasonal patterns of\nconsumption. Many other economic variables, such as em-ployment,\nmoney supply, heating oil demand, and sales of\nnew automobiles, also exhibit significant seasonal variation.\u003cbr\u003e\u003cbr\u003eOften, it is easy to understand why these seasonal varia-tions\noccur, but they make it difficult to analyze and under-stand\nthe time series data. If the price of a wheat futures\ncontract goes down by 10 cents during August, for instance,\nit would be helpful to know how much of that drop can be\nattributed to normal seasonal patterns and how much can be\nattributed to other factors.\u003cbr\u003e\u003cbr\u003eIf we use time series data as part of a technical trading\nsystem or to analyze trends, we may want to separate the\nnormal seasonal variation to see nonseasonal patterns more\nclearly. This process is known as seasonal adjustment. Many\nwidely published economic statistics, such as the unemploy-ment\nrate and the consumer price index (CPI), are seasonally\nadjusted before being published.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52134009471345,"sku":"\\V17\\C01\\002SEAS.PDF","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_b7a4314b-a194-4e20-a77a-b988f05455a2.jpg?v=1739662065"},{"product_id":"v112intalfro1","title":"V.17:3 (128-137): Interview: Tales From The Front: Robert Zellner by Thom Hartle","description":"Tales From The Front: Robert Zellner\u003cbr\u003e\u003cbr\u003eRobert Zellner, whose career has ranged from academic to institutional\ntrader to business manager before settling on full-time private trader,\nstarted off with his sights aimed on academia, despite a grandfather who was\na speculator in the 1920s and 1930s. But it wasnt long before the family\ngenes came into play and Zellner stepped into the trading arena. He has\nworked for Cook Industries; Drexel Burnham Lambert; and Citibank\nFutures, among other financial firms. STOCKS \u0026amp; COMMODITIES Editor\nThom Hartle met Zellner when their careers overlapped at Drexel back in\nthe 1980s. Hartle interviewed Zellner via telephone on December 22, 1998,\nasking him about his work, past and present, his views on the markets, and\nhis philosophies about trading.\u003cbr\u003e\u003cbr\u003eWhen you have a model that works well, it is very easy to just\nuse it and not pay any attention to the market. There are lots\nof things wrong with using computer models, but that is\nprobably the single worst thing about using them. It makes\nyou lazy. It prevents you from developing judgment. Computers\ncan prevent you from paying attention. Robert Zellner","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52134010913137,"sku":"\\V17\\C03\\021INT.PDF","price":4.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_d2c34e20-b98f-4b60-bf0b-a0ef79937b8c.jpg?v=1739662171"},{"product_id":"v131mombystu","title":"V.17:7 (314-318): Momentum by Stuart Evens","description":"Momentum\u003cbr\u003e\u003cbr\u003eTrend-following methods and indicators have drawbacks:\nOne, they indicate a change in trend after the fact, thereby\nmissing a significant portion of the initial move. Two, markets\nspend a lot of time not in trends, but in trading ranges \nand using trend-following methods with prices in trading\nranges can result in whipsaw losses. To avoid these pitfalls,\nmomentum indicators are used to forewarn of a change in\ntrend and the reversal of price at support and resistance\nlevels within a trading range. Momentum is not a perfect\nmethod or indicator, but used appropriately, it can be extremely\nuseful. A thorough understanding of momentum can\nhelp in making trading decisions.\u003cbr\u003e\u003cbr\u003eMomentum, according to techni-cian\nJohn J. Murphy, can be\ndefined as a technique used to\nconstruct an overboughtover-sold\noscillator, measuring\nprice differences over time. Fig-ure\n1 shows the 10-day mo-mentum\nline for the daily chart\nfor Intel.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52134013829489,"sku":"\\V17\\C07\\051MOME.PDF","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_b7354764-88d7-488e-8e57-a4a3400f326b.jpg?v=1739662393"},{"product_id":"v136momandre","title":"V.17:8 (367-372): Momentum And Relative Strength Index by Stuart Evens","description":"Momentum And Relative\nStrength Index\u003cbr\u003e\u003cbr\u003eLast month, we examined the theory of price momentum. This\ntime, well look at two common and popular indicators based\non this theory, and how they can be used to enter and exit a\nmarket.\u003cbr\u003e\u003cbr\u003e\"Momentum oscillator is a generic\nterm used to refer to many different\nindicators, two of which\nare the relative strength index\n(RSI) and momentum indicators.\nSince J. Welles Wilder presented\nprice momentum and the RSI in\nhis classic New Concepts In\nTrading Systems, both indicators\nhave become popular technical\ntools, and a discussion of\neach can be found in most current\nworks on technical analysis.\nBoth indicators can be used to enter and exit the market.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52134013862257,"sku":"\\V17\\C08\\062MOME.PDF","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_ebb706ee-c94b-4a4e-ab68-ca48407b6d25.jpg?v=1739662395"},{"product_id":"v144tradmacb","title":"V.17:10 (445-448): Trading the MACD by Jayanthi Gopalakrishnan","description":"Trading The MACD\u003cbr\u003e\u003cbr\u003eYou can trade Gerald Appels moving average convergence\/\ndivergence profitably in relatively flat markets. Heres how.\u003cbr\u003e\u003cbr\u003eThe moving average convergence\/\ndivergence (MACD) is a\nmomentum oscillator developed\nby Gerald Appel in the\nearly 1970s. For this oscillator,\nmomentum implies that\nfluctuations in prices are reflected\nin the MACD; if there is\na sudden increase in price, the\nMACD will move upward. It\nfluctuates above and below a\nzero line which is why it is known as an oscillator. The zero\nline is the horizontal equilibrium line and if the indicator is\nabove the zero line, it is a bullish signal and if below the zero\nline, a bearish signal.\nThe MACD does what its name suggests: it measures the\ndivergence or convergence of a shorter moving average with\na longer moving average. It is represented in two ways, one\nas a line form and the other as a histogram. Figure\n1 illustrates the line and histogram versions of\nthe MACD for the same security.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52134016385393,"sku":"\\V17\\C10\\078MACD.PDF","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_698d71cf-2a18-46e3-a06a-2d9fa4bd3040.jpg?v=1739662523"},{"product_id":"v145getstarw","title":"V.17:10 (458-462): Getting Started With Options by Joe Demkovich and Eugene Theriot","description":"Getting Started With Options\u003cbr\u003e\u003cbr\u003eRather than shying away from the complexity of options, stick\nwith some simple basics in exploiting them.\u003cbr\u003e\u003cbr\u003eYou can start paper-trading options\ndespite their daunting\nreputation for complexity. If you\nsucceed on paper, youll have\ntaken the first step to extracting\nprofits from the real market. Its\ntrue that there are many kinds of\noptions, and options terminology\nis like a foreign language,\nbut professional traders use options\nfor a good reason. Well\ntell you why.\nBut first, yes, you can lose 100% of your investment. Of\ncourse, it is theoretically possible to do this by buying a stock,\nbut it just doesnt happen. Even if you make an incredibly\npoor choice of equities, you (usually) wont lose all the value\nin the next month or two. But it is all too easy to buy an option\none week that will be worthless the next. However, options\ncan also be conservative, especially when used in conjunction\nwith equities that you already own.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52134017827185,"sku":"\\V17\\C10\\080GET.PDF","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_8f83db82-0196-4bc6-b558-fd6fb45a4049.jpg?v=1739662630"},{"product_id":"v123onvolbys","title":"V.17:5 (234-240): On-Balance Volume by Stuart Evens","description":"On-Balance\nVolume by Stuart Evens\u003cbr\u003e\u003cbr\u003eWhat do technicians look at in order to qualify the significance\nof a trend? One key element is volume, in that high\nvolume in a trend indicates that large players may be involved.\nThe theory goes that large traders are better informed,\nso the trend is likely to continue. How can you track\nvolume? Does a volume-based indicator help the analyst and\ntrader? Take a look.\u003cbr\u003e\u003cbr\u003eOne of the better-known technical\nindicators to track volume\nis the on-balance volume\n(OBV). The OBV line is simply\na running sum calculated by\nadding or subtracting the\nsecuritys daily volume from\nthe previous days OBV value,\ndepending on whether the\nsecuritys closing price was up\nor down for the day. The OBV\nline is usually plotted as a line above or below the price bar\ngraph of the security (Figure 1). Two popular uses of this\nindicator is to watch for confirmation of the price trend by the\nOBV line, indicating that the volume is increasing in the\ndirection of the trend, and forewarning of a trend reversal by\nthe divergence between the direction of the OBV line and the\nprice trend. Lets look at the initial method and theory.\u003cbr\u003e\u003cbr\u003eOBV PHILOSOPHY\u003cbr\u003e\u003cbr\u003eOBV creator Joseph Granville first presented the concept of\nOBV in Granvilles New Key To Stock Market Profits. In\ndeveloping this tool, Granville started with the premise that\nmarket participants are divided into smart money entities and\nthe general public. He assumed that the smart money was able\nto accumulate stock at lower prices compared with that of the\npublic based on their having better information.\u003cbr\u003e\u003cbr\u003eDuring a bull market, Granville theorized, smart money\ninitially bids prices up and then only participates in the\nbuying for the first-half to two-thirds of the move. At that\npoint, smart money players are fully invested and are now\nholding for the last third of the move, planning to sell out at\nthe top. He opined that this is just when most of the public is\nstarting to notice the runup in prices and is buying the stock.\nThis sets the stage for the smart money, who then dumps\nstock to the public.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52134023135601,"sku":"\\V17\\C05\\036OBV.PDF","price":3.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_444df4ee-c786-4b9e-b4e7-6362bdb19e4c.jpg?v=1739662852"}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/collections\/volume-17-1999-18.gif?v=1739677650","url":"https:\/\/shop.traders.com\/collections\/articles-volume-17.oembed","provider":"Stocks \u0026 Commodities","version":"1.0","type":"link"}