FT Press, 2010, 656 pp.
Already the most complete, reliable, and objective guide to technical analysis, this book has been thoroughly updated to reflect the latest advances. Selected as the official companion to the prestigious Market Technicians Association CMT program, it systematically explains the field’s principles and techniques, presenting academic evidence and hundreds of illustrations.
Using hundreds of updated illustrations, the authors show how to analyze both markets and individual issues and present complete investment systems and portfolio plans. Readers lea how to use tested sentiment, momentum indicators, seasonal effects, flow of funds, and many other key techniques. Drawing on current research, the authors reveal which chart pattes and indicators remain the most reliable, demonstrate how to test systems, and show how to use technical analysis to mitigate risk.
This edition covers recent advances in patte recognition, market analysis, systems management, and other areas. It introduces new confidence tests; innovations in exit stops, portfolio selection, and testing; and the implications of behavioral bias for technical analysis. The authors also reassess classic methods such as intermarket relationships and measurements of market strength, identifying pitfalls that have emerged in recent years.
Iintroduction to technical analysis.
The trend.
History of technical analysis.
Mode technical analysis.
Do markets follow a random walk?
Fat tails.
Drawdowns.
Proportions of scale.
Can past pattes be used to predict the future?
Behavioral finance and technical analysis.
Markets and market indicators.
Dow theory theorems.
Sentiment.
Sentiment indicators based on options and volatility.
Historical indicators.
Sentiment in other markets.
Measuring market strength.
Market breadth.
Up and down volume indicators.
High low logic index.
Number of stocks above their -week moving average.
Very short-term indicators.
Arms index.
Net ticks.
Temporal pattes and cycles.
Kondratieff waves, ork-waves -year historical cycles.
Four- year or presidential cycle.
Seasonal pattes.
January effect.
Flow of funds.
Funds in the marketplace.
The cost of funds.
Misery index.
Boucher's t-bill rate of change rule.
Zweig's prime rate indicator.
Fed policy.
Predicting federal reserve policy changes.
Zweig's fed indicator.
Three steps and a stumble.
Two tumbles and a jump.
Long-term interest rates (or inversely, the bond market).
Yield curve.
Trend analysis.
Early charts.
Line charts.
Bar charts.
Candlestick charts.
Arithmetic scale.
Semi-logarithmic scale.
Point-and-figure charts.
One-box (point) reversal.
Box size.
Multi-box reversal.
Time.
Trend—the key to profits.
Basis of trend analysis—dow theory.
Determining a trading range.
Directional trends (up and down).
Channels.
Inteal trend lines.
Retracements.
Pullbacks and throwbacks.
Other types of trend lines.
Trend lines on point-and-figure charts.
Speed lines.
Andrews pitchfork.
Breakouts, stops, and retracements.
Calculating a risk/retu ratio for breakout trading.
Placing stops for a false (or "specialist") breakout.
Moving averages.
The linearly weighted moving average (lwma).
The exponentially smoothed moving average (ema).
Geometric moving average (gma).
Triangular moving average.
Variable emas.
Strategies for using moving averages.
Determining trend.
Determining support and resistance.
Determining price extremes.
Giving specific signals.
Constructing directional movement indicators.
Using directional movement indicators.
Trading strategies using bands and envelopes.
Channel.
Chart patte analysis.
Common patte characteristics.
Behavioral finance and patte recognition.
Computers and patte recognition.
Market structure and patte recognition.
Double top and double bottom.
Rectangle (also "trading range" or "box").
Triple top and triple bottom.
Standard triangles—descending, ascending, and symmetrical.
Descending triangle.
Ascending triangle.
Symmetrical triangle (also "coil" or "isosceles triangle").
Broadening pattes.
Diamond top.
Wedge and climax.
Pattes with rounded edges—rounding and head and.
Shoulders.
Rounding top, rounding bottom (also "saucer, " "bowl, " or "cup").
Head and shoulders.
Shorter continuation trading pattes—flags and pennants (also.
"half-mast formation").
Long-term bar chart pattes with the best performance and the.
Lowest risk of failure.
Ooint-and-figure chart pattes.
Time and volume omitted.
Continuous price flow necessary.
"old" and "new" methods.
One-box reversal point-and-figure charts.
Trend lines in one-box charts.
The count in a one-point chart.
Head and shoulders.
The fulcrum.
Action points.
Three-point (or box) reversal point-and-figure charts.
Trend lines with three-box charts.
The count using three-box reversal charts.
The eight standard pattes for three-box reversal charts.
Other pattes.
Short-term pattes.
Traditional short-term pattes.
Gaps.
Spike (or wide-range or large-range bar).
Dead cat bounce (dcb).
Island reversal.
One- and two-bar reversal pattes.
Multiple bar pattes.
Volatility pattes.
Intraday pattes.
Summary of short-term pattes.
Candlestick pattes.
One- and two-bar candlestick pattes.
Multiple bar pattes.
Trend confirmation.
Volume confirmation.
Volume-related oscillators.
Volume spikes.
Examples of volume spikes.
Open interest indicators.
Price confirmation.
How successful are momentum indicators? .
Specific indexes and oscillators.
How can cycles be found in market data? .
Fourier analysis (spectral analysis).
Maximum entropy spectral analysis.
Simpler (and more practical) methods.
Projections, projecting period,projecting amplitude.
Elliott wave theory (ewt).
Impulse waves.
Corrective waves.
Guidelines and general characteristics in ewt.
Projected targets and retracements.
Alteatives to ewt.
The fibonacci sequence.
The golden ratio.
Price and time targets.
W d. Gann.
Selection of markets and issues: trading and investing.
Choosing between futures markets and stock markets.
Which issues should i select for investing? .
Top-down analysis.
Secular emphasis.
Cyclical emphasis.
Stock market industry sectors.
Bottom up—specific stock selection and relative strength.
Relative strength.
Academic studies of relative strength.
Measuring relative strength.
Examples of how selected professionals screen for favorable stocks.
The william o'neil can slim method.
James p. O'shaughnessy method.
Charles d. Kirkpatrick method.
Value line method.
Richard d. Wyckoff method.
System testing and management.
Discretionary versus nondiscretionary systems.
Requirements for designing a system.
Understanding risk.
Initial decisions.
Types of technical systems.
Measuring system results for robustness.
Risk and money management.
Defining risk.
Concepts.
Reward to risk.
Normal risks.
Unusual risks.
Money management risk strategies.
Exit strategies.
Monitoring systems and portfolios.
A basic statistics.
Retus.
Probability and statistics.
Descriptive statistics.
Measures of central tendency.
Measures of dispersion.
Relationships between variables.
Inferential statistics.
Mode portfolio theory.
Performance measurement.
Advanced statistical methods.
Artificial intelligence.
Review questions.
Types of orders and other trader terminology.
ISBN-10: 0137059442, ISBN-13: 978-0137059447
Already the most complete, reliable, and objective guide to technical analysis, this book has been thoroughly updated to reflect the latest advances. Selected as the official companion to the prestigious Market Technicians Association CMT program, it systematically explains the field’s principles and techniques, presenting academic evidence and hundreds of illustrations.
Using hundreds of updated illustrations, the authors show how to analyze both markets and individual issues and present complete investment systems and portfolio plans. Readers lea how to use tested sentiment, momentum indicators, seasonal effects, flow of funds, and many other key techniques. Drawing on current research, the authors reveal which chart pattes and indicators remain the most reliable, demonstrate how to test systems, and show how to use technical analysis to mitigate risk.
This edition covers recent advances in patte recognition, market analysis, systems management, and other areas. It introduces new confidence tests; innovations in exit stops, portfolio selection, and testing; and the implications of behavioral bias for technical analysis. The authors also reassess classic methods such as intermarket relationships and measurements of market strength, identifying pitfalls that have emerged in recent years.
Iintroduction to technical analysis.
The trend.
History of technical analysis.
Mode technical analysis.
Do markets follow a random walk?
Fat tails.
Drawdowns.
Proportions of scale.
Can past pattes be used to predict the future?
Behavioral finance and technical analysis.
Markets and market indicators.
Dow theory theorems.
Sentiment.
Sentiment indicators based on options and volatility.
Historical indicators.
Sentiment in other markets.
Measuring market strength.
Market breadth.
Up and down volume indicators.
High low logic index.
Number of stocks above their -week moving average.
Very short-term indicators.
Arms index.
Net ticks.
Temporal pattes and cycles.
Kondratieff waves, ork-waves -year historical cycles.
Four- year or presidential cycle.
Seasonal pattes.
January effect.
Flow of funds.
Funds in the marketplace.
The cost of funds.
Misery index.
Boucher's t-bill rate of change rule.
Zweig's prime rate indicator.
Fed policy.
Predicting federal reserve policy changes.
Zweig's fed indicator.
Three steps and a stumble.
Two tumbles and a jump.
Long-term interest rates (or inversely, the bond market).
Yield curve.
Trend analysis.
Early charts.
Line charts.
Bar charts.
Candlestick charts.
Arithmetic scale.
Semi-logarithmic scale.
Point-and-figure charts.
One-box (point) reversal.
Box size.
Multi-box reversal.
Time.
Trend—the key to profits.
Basis of trend analysis—dow theory.
Determining a trading range.
Directional trends (up and down).
Channels.
Inteal trend lines.
Retracements.
Pullbacks and throwbacks.
Other types of trend lines.
Trend lines on point-and-figure charts.
Speed lines.
Andrews pitchfork.
Breakouts, stops, and retracements.
Calculating a risk/retu ratio for breakout trading.
Placing stops for a false (or "specialist") breakout.
Moving averages.
The linearly weighted moving average (lwma).
The exponentially smoothed moving average (ema).
Geometric moving average (gma).
Triangular moving average.
Variable emas.
Strategies for using moving averages.
Determining trend.
Determining support and resistance.
Determining price extremes.
Giving specific signals.
Constructing directional movement indicators.
Using directional movement indicators.
Trading strategies using bands and envelopes.
Channel.
Chart patte analysis.
Common patte characteristics.
Behavioral finance and patte recognition.
Computers and patte recognition.
Market structure and patte recognition.
Double top and double bottom.
Rectangle (also "trading range" or "box").
Triple top and triple bottom.
Standard triangles—descending, ascending, and symmetrical.
Descending triangle.
Ascending triangle.
Symmetrical triangle (also "coil" or "isosceles triangle").
Broadening pattes.
Diamond top.
Wedge and climax.
Pattes with rounded edges—rounding and head and.
Shoulders.
Rounding top, rounding bottom (also "saucer, " "bowl, " or "cup").
Head and shoulders.
Shorter continuation trading pattes—flags and pennants (also.
"half-mast formation").
Long-term bar chart pattes with the best performance and the.
Lowest risk of failure.
Ooint-and-figure chart pattes.
Time and volume omitted.
Continuous price flow necessary.
"old" and "new" methods.
One-box reversal point-and-figure charts.
Trend lines in one-box charts.
The count in a one-point chart.
Head and shoulders.
The fulcrum.
Action points.
Three-point (or box) reversal point-and-figure charts.
Trend lines with three-box charts.
The count using three-box reversal charts.
The eight standard pattes for three-box reversal charts.
Other pattes.
Short-term pattes.
Traditional short-term pattes.
Gaps.
Spike (or wide-range or large-range bar).
Dead cat bounce (dcb).
Island reversal.
One- and two-bar reversal pattes.
Multiple bar pattes.
Volatility pattes.
Intraday pattes.
Summary of short-term pattes.
Candlestick pattes.
One- and two-bar candlestick pattes.
Multiple bar pattes.
Trend confirmation.
Volume confirmation.
Volume-related oscillators.
Volume spikes.
Examples of volume spikes.
Open interest indicators.
Price confirmation.
How successful are momentum indicators? .
Specific indexes and oscillators.
How can cycles be found in market data? .
Fourier analysis (spectral analysis).
Maximum entropy spectral analysis.
Simpler (and more practical) methods.
Projections, projecting period,projecting amplitude.
Elliott wave theory (ewt).
Impulse waves.
Corrective waves.
Guidelines and general characteristics in ewt.
Projected targets and retracements.
Alteatives to ewt.
The fibonacci sequence.
The golden ratio.
Price and time targets.
W d. Gann.
Selection of markets and issues: trading and investing.
Choosing between futures markets and stock markets.
Which issues should i select for investing? .
Top-down analysis.
Secular emphasis.
Cyclical emphasis.
Stock market industry sectors.
Bottom up—specific stock selection and relative strength.
Relative strength.
Academic studies of relative strength.
Measuring relative strength.
Examples of how selected professionals screen for favorable stocks.
The william o'neil can slim method.
James p. O'shaughnessy method.
Charles d. Kirkpatrick method.
Value line method.
Richard d. Wyckoff method.
System testing and management.
Discretionary versus nondiscretionary systems.
Requirements for designing a system.
Understanding risk.
Initial decisions.
Types of technical systems.
Measuring system results for robustness.
Risk and money management.
Defining risk.
Concepts.
Reward to risk.
Normal risks.
Unusual risks.
Money management risk strategies.
Exit strategies.
Monitoring systems and portfolios.
A basic statistics.
Retus.
Probability and statistics.
Descriptive statistics.
Measures of central tendency.
Measures of dispersion.
Relationships between variables.
Inferential statistics.
Mode portfolio theory.
Performance measurement.
Advanced statistical methods.
Artificial intelligence.
Review questions.
Types of orders and other trader terminology.
ISBN-10: 0137059442, ISBN-13: 978-0137059447