ARTICLE SYNOPSIS ...A CHRISTMAS STORY by Ron Jaenisch Jaenisch, a student of Professor Allen Andrews, reviews some of the Andrews Median Line and pivot point techniques in a whimsical story about trading Santa's account. It was September 15, 1984 and time was getting short. Usually by the middle of September all the raw materials and supplies had been purchased and over 80 percent of the toys assembled. This year Santa knew he was in deep trouble. He needed one million dollars and only had $100,000. He looked at his production schedule and surmised that he could somehow make all the toys needed for Christmas i...
BY: Ron Jaenisch
ARTICLE SYNOPSIS ...Charting the universe of funds by Technical Analysis, Inc. FUNDGRAF Parsons Software 118 Woodshire Drive Parkersburg, West Virginia, 26101 (304) 424-5191 Price: $100 Computer: IBM PC and compatibles So wide-spread is today's speculative impulse that ""playing"" the markets has spread to that bastion of conservative diversification, the mutual funds. Those who wouldn't dream of shorting an individual issue don't hesitate to try picking tops and bottoms in the Magellan Fund. Naturally, for those folks, there is software support available and FUNDGRAF is part of this genera: a program to chart ...
BY: Technical Analysis, Inc.
ARTICLE SYNOPSIS ...Does pyramiding make sense? by Fred Cehm The leverage obtained through pyramiding can be immense. But is it smart? Gehm examines the pyramiding technique and its possible consequences. Recently, well-known traders and trading advisors have argued that pyramiding is one of the most important-- if not the most important--money management techniques. Stanley Kroll, for example, attributes much of this success to pyramiding. ""If done correctly,"" he states, ""it is the trader's best tool for big profits in commodities."" Since Kroll apparently used this technique to turn $180,000 into more than ...
BY: Fred S. Gehm
ARTICLE SYNOPSIS ...Letters by Technical Analysis Editor: Clifford Sherry's article on the Gambler's Paradox (better known as the Gambler's Fallacy) in the October issue contains a serious error. In using Chi square to test the independence of price changes, Dr. Sherry gives the probability of obtaining a sequence of '+,+' or one of '-,-'as 0.1666 and the probability of obtaining a sequence of '+,-' or of a ',+' as 0.3333. In any random and independent sequence of events, each of which has any probability of 0.5, the probability of obtaining any one of the four possible sequences is simply 0.25. In the sample o...
BY: Technical Analysis, Inc.
ARTICLE SYNOPSIS ...Mutual funds by Bill Dunbar A basic look at mutual funds: who they are for, how to choose one, why and when to switch. Also included are several sources of information to use to get specifics when deciding on a mutual fund. In the past, critics of the Dow Theory have said, why worry about the averages--you can't invest in the averages. Well, you can now, of course, by putting your money into index options or futures. But, with options, the house takes a big bite and you have to guess not only what the market is going to do, but also, within a few months when it is going to do it. That's a pr...
BY: Bill Dunbar
ARTICLE SYNOPSIS ...Optimizing RSI with cycles by John F. Ehlers A look at Wilder's Relative Strength Index oscillator and an optimization using cycles. Also included is a BASIC computer program which follows the author's optimization processes. As an engineer I have often been puzzled by some of the terms used by investors. One example is the use of ""oscillators"" to form trading signals. I have always thought that an oscillator was a device that generated cycles. This caused my initial attraction to such indicators. I quickly learned that a trading oscillator had nothing to do with cycles. Used in the tradi...
BY: John F. Ehlers
ARTICLE SYNOPSIS ...The Wyckoff method Trading and Investing in Stocks by Jack K. Hutson The first in a series of articles which outline the Richard D. Wyckoff method of trading stocks. This method provides a foundation for analyzing the fundamental relationships between the market's primary forces. Through the use of such techniques as volume analysis and studies of vertical line, figure and wave charts, Wyckoff developed a trading method which is still applicable to today's markets. Richard Wyckoff's first instruction to students of his stock analysis method published in the 1930s was quite simple and specifi...
BY: Jack K. Hutson
ARTICLE SYNOPSIS ...The handbook for no-load fund investors by Bill Dunbar This book is up-to-date and effective in almost all respects. I'd say it's well worth the money to anyone interested in mutual funds. Also, if there is an investor left among us who still thinks he is deriving some benefit from a loading charge, he shouldn't have to read beyond the Preface to be relieved of such fantasies. Though it treats the entire span of investment objectives, the emphasis is on ""aggressive growth"" and on switching funds every 'one to four years' as required by the rise and fall of individual funds and by the ups an...
BY: Bill Dunbar
ARTICLE SYNOPSIS ...The last wild ride of the gold bears is upon us by Joseph Holleman Holleman, a CTA and CPO, offers his opinions on where gold prices may be headed. These predictions demonstrate how positions in the market are developed and show the factors that shape a trader's reasoning about a specific market. The precious metals markets are about to collapse and collapse hard. My indicators are presently calling for a minimum move to $250 on gold and probably all the way down to the $150 level, also taking silver and platinum with it to comparable levels. Now, I hope most of you were sitting down when y...
BY: Joseph Holleman
ARTICLE SYNOPSIS ...Wilder's back ...by Technical Analysis, Inc. An in-depth interview with J. Welles Wilder, developer of the popular Relative Strength Index and other technical indicators. It's not often that truly original discoveries are made in technical market analysis. J. Welles Wilder, however, lays claim to an entire collection of systems that have reshaped contemporary commodities trading and analysis. Wilder's methods first came to light in 1978 with the publication of his book, New Concepts in Technical Trading Systems. The book is required reading among technical traders today, and many of its too...
BY: Technical Analysis, Inc.