ARTICLE SYNOPSIS ...Stocks & Commodities V. 25:2 (20-26): Anticipating Moving Average Crossovers by Dimitris Tsokakis Although simple moving averages may be a technical analyst's best friend, they do tend to lag. Here's how you can overcome this problem. Moving averages are excellent indicators to confirm existing trends in spite of their lag. To overcome this lag, several alternatives such as the exponential moving average (EMA) and the weighted moving average (WMA) have been applied to price charts. In this article, I will not tweak the simple moving average (SMA). Instead, I will decrease the lag of the SMA ...
BY: Dimitris TsokakisSUBJECT: Indicators
ARTICLE SYNOPSIS ...Stocks & Commodities V. 25:2 (92): Books For Traders by Technical Analysis, Inc. Anatomy of the Bear: Lessons From Wall Street's For Great Bottoms (324 pages, $34.96 softcover, 2005, ISBN 9628606794) by Russell Napier, published by CLSA Books. How does one spot the bottom of a bear market? What brings a bear to its end? The author looks at the four occasions when US equities were undervalued and tries to answer these questions by analyzing every article in The Wall Street Journal for two months on either side of each market bottom. After examining 70,000 articles he began to understand what i...
BY: Technical Analysis, Inc.SUBJECT: Books For Traders
ARTICLE SYNOPSIS ...Stocks & Commodities V. 25:2 (38): Explore Your Options by Tom Gentile Got a question about options? Tom Gentile is the chief options strategist at Optionetics (www.optionetics.com), an education and publishing firm dedicated to teaching investors how to minimize their risk while maximizing profits using options. To submit a question, post it to our website at http://Message-Boards.Traders.com. Answers will be posted there, and selected questions will appear in a future issue of S&C. PUTS AFTER BANKRUPTCY I own January 2009 puts in a company I feel will be bankrupt in the near future. I hav...
BY: Tom GentileSUBJECT: Explore Your Options
ARTICLE SYNOPSIS ...Stocks & Commodities V. 25:2 (32-36): Follow That Trend by Michael Covel and Justin Vandergrift Even if you are a trend-follower, you still have to be a systematic trader. Here's why you still have to manage drawdowns when the market is not trending. As so often happens, it's not the answer that is wrong, but the question. People ask me how long trend-following trading will last. Well, there is no reason trend-following should ever stop. Only if markets were to go sideways forever would trends cease to exist and therefore trend-following cease to work. Trend-following traders respond to what...
BY: Michael Covel and Justin VandergriftSUBJECT: Trading Techniques
ARTICLE SYNOPSIS ...Stocks & Commodities V. 25:2 (14-18): Forex Focus: Is Gold A Hedge Against A Falling Dollar? by John L. Momsen Access to foreign exchange trading has opened up exciting trading options for the retail trader. You can now trade alongside corporations and institutions in a highly liquid market that is global, traded around the clock, and highly leveraged. Before jumping into this market, however, we must understand the factors that affect the forex market. With that in mind, STOCKS & COMMODITIES has introduced Forex Focus to better prepare the retail trader to participate in the currency market....
BY: John L. MomsenSUBJECT: FocusForex Momsen PM
ARTICLE SYNOPSIS ...Stocks & Commodities V. 25:2 (44-48): From Nile to NYSE by Radha Panini Here's an analysis of the profitability of an indicator based on the Hurst exponent. In researching and developing trading systems, we came across an indicator based on fractal concepts. Not only is it simple and functional, the underlying theory is elegant and introduces a new way of looking at finance. To understand it better we looked into the origins of fractal concepts in finance. Here, we begin with the historical development of the field and follow it with the underlying theory and numerical methods. Then we test...
BY: Radha PaniniSUBJECT: Quantitative Analysis
ARTICLE SYNOPSIS ...Stocks & Commodities V. 25:2 (58-63): Interview: John Person by Jayanthi Gopalakrishnan John Person is a 25-year veteran of the futures and options trading industry. Person started on the floor of the Chicago Mercantile Exchange back in 1979. He then had the privilege of working with George Lane, the innovator of stochastics. Person worked his way throughout the industry as a trader, broker, analyst, and branch manager for one of Chicago's largest discount/full-service firms under the direct supervision of a former chairman of the Chicago Board of Trade. John Person is the former owner and pr...
BY: Jayanthi GopalakrishnanSUBJECT: Interview
ARTICLE SYNOPSIS ...Stocks & Commodities V. 25:2 (10-13): Letters To S&C by Technical Analysis, Inc. The editors of S&C invite readers to submit their opinions and information on subjects relating to technical analysis and this magazine. This column is our means of communication with our readers. Is there something you would like to know more (or less) about? Tell us about it. Without a source of new ideas and subjects coming from our readers, this magazine would not exist. SWING CHART Editor, I just read "Searching For (Trading) Certainty" by Aaron Lynch (December 2006 S&C) and would like to know how to reco...
BY: Technical Analysis, Inc.SUBJECT: Letters To S&C
BY: Jayanthi GopalakrishnanSUBJECT: Opening Position
BY: Technical Analysis, Inc.SUBJECT: Traders' Resource
ARTICLE SYNOPSIS ...Stocks & Commodities V. 25:2 (80-89): Traders' Tips by Technical Analysis, Inc. Here is this month's selection of Traders' Tips, contributed by various developers of technical analysis software, all to help readers more easily implement some of the strategies presented in this issue. Most of this month's Traders' Tips are based on Dimitris Tsokakis' article in this issue, "Anticipating Moving Average Crossovers." Code written in AmiBroker Formula Language for AmiBroker software is provided by the author in the article. Additional code is presented here for TradeStation, MetaStock, eSignal, W...
BY: Technical Analysis, Inc.SUBJECT: Traders' Tips
ARTICLE SYNOPSIS ...Stocks & Commodities V. 25:2 (64-67): Tuning Intraday Strategies by Lee Leibfarth Developing a daytrading strategy that is consistent across all markets is impossible. But here are some things to keep in mind when assessing your daytrading strategy. The growing availability of trading platforms that can build, backtest, and automate intraday trading strategies is allowing more and more traders to develop and test their own unique daytrading ideas. Constructing a rulebased daytrading system using historical data can help traders develop sound, statistical logic and create a higher level of co...
BY: Lee LeibfarthSUBJECT: Trading Systems
ARTICLE SYNOPSIS ...Stocks & Commodities V. 25:2 (75, 78): Websites For Traders: MaoXian by David Penn MAOXIAN.COM Come for the economic insights and financial analysis. Stay for the jpegs of Chinese hotties? I first came across MaoXian.com after spending a little time at another financial blog, TraderMike.net (tradermike.net). The phrase "MaoXian" apparently means "to take a risk" and at its most basic, MaoXian.com -- a blog run pseudonymously by "Chairman MaoXian" -- spends much of its time discussing developments in Chinese economics and society in addition to serving up analysis and commentary on ETFs, US equ...
BY: David PennSUBJECT: Websites For Traders
ARTICLE SYNOPSIS ...Stocks & Commodities V. 25:2 (57): Websites For Traders: Pinksheets.com by David Penn PINKSHEETS.COM Many is the successful broker who, although currently trading blue chips, got his or her start patrolling the market for over-the-counter stocks known as the "pink sheets," looking to find that elusive three-dollar (or even three-cent) stock primed to go gangbusters. As you might imagine, three-cent stocks tend not to be the most investment grade of equities, which is one reason why a stock might find itself delisted from the exchanges and making a home for itself in the pink sheets (so-call...
BY: David PennSUBJECT: Websites For Traders
ARTICLE SYNOPSIS ...Stocks & Commodities V. 25:2 (54-56): Why Position Trade? by Martha Stokes Position trading offers some good opportunities for current market conditions. Here's how you can benefit. When the stock market is dominated by short-term traders, the position trade is often forgotten in favor of the betterknown daytrading, swing, and option trading techniques. This is unfortunate because position trading offers some excellent opportunities for prevailing current market conditions. The stock market sees long periods of sideways action followed by sudden bursts of price action, both momentum patterns...
BY: Martha Stokes, CMTSUBJECT: Basic Techniques
BY: Jim UllandSUBJECT: Working Money
BY: Matt BlackmanSUBJECT: Working Money
BY: Stephen W. BigalowSUBJECT: Working Money