ARTICLE SYNOPSIS ...Completing the DMI rules
by Jim Summers
Finally, after these many months, the Lotus Command Language code to reproduce Wilder's
Directional Movement Index system (DMI) reaches an end. In using Wilder's DMI to teach readers of
Stocks & Commodities how to program Lotus, we've come a long way. Starting with the simplest of
macros, we're now into programming at a fairly high level and have used a number of techniques,
including debugging strategies. Recent comments by Dr. A.O.T. Fayiga (S&C, November 1988) show
that different programming methods can reach the same goals, something affirmed by eve...
ARTICLE SYNOPSIS ...Into the Pit
by Joseph Wilson
In December 1985, I was approved for membership to the Chicago Mercantile Exchange. I obtained a
membership to the Index and Options Market, which gave me the right to trade the S&P 500 futures. Let
me digress for a moment. As you may already be aware, the S&P 500 futures have taken the brunt of the
heat from the regulators who are looking for a scapegoat for the October 1987 crash in the stock market. I
disagree with their criticisms, but that is another story.
The ""big guys"" trade the futures market in two ways: first, as a hedge for the stock portfolios and...
ARTICLE SYNOPSIS ...LETTERS TO S&C
Several articles have appeared in S&C wherein optimization was discussed. I would like to discuss
something I encountered at least six years ago when I first tried optimizing. Some of your readers may
have had the same experience and can further comment on the subject.
The best way to explain this subject may be by example.
The example is extremely simple. It involves optimizing, in one of my programs, only two parameters--a
decimal for an exponential average for buying and a decimal for an exponential average for selling. The
buy decimal was stepped fro...
Logarithmic point and figure charts by Luis Ballesca Loyo
ARTICLE SYNOPSIS ...Logarithmic point and figure charts
by Luis Ballesca Loyo
During the early development of technical analysis, almost all types of graphing methods used the
arithmetic values of prices for charting. Not so long ago, it became a common practice to construct charts
or graphs using a logarithmic scale. Experience has shown me that this proportional scale has many
advantages over the arithmetic method when it comes to analyzing price formations and market
Actually, using point and figure charting clearly shows the difference between graphing on the arithmetic
scale and graphing on log...
ARTICLE SYNOPSIS ...Options: Let price come to you
by Jerry Kopf
The average retail trader's first option transaction is often profitable--but rarely do rookie option
traders know the actual reason behind their profits. Call it beginner's luck. If they win at first, they think
they are walking on water. They annualize one week's return and start planning an early semi-retirement.
Once luck ends, a newcomer's limited experience along with the swiftness of price movement causes a
rash of painful losses. The undeniable fact is there is no quick method to learn to trade well and
consistently be on the plus side. Cal...
Stock hedge portfolios: A strategy for all seasons by Larry Christy
ARTICLE SYNOPSIS ...Stock hedge portfolios: A strategy for all seasons
by Larry Christy
If you're looking for a conservative way to make substantial profits in any kind of market environment,
you may want to consider common stock hedge portfolios. By balancing an equal amount of your capital
in long and short stock positions, you can reduce market risk and take advantage of the ability of some
stocks to outperform other stocks.
For an example of the theory behind this strategy, just check The Wall Street Journal's listing of
yesterday's biggest percentage gainers and losers among common stocks. On any given day...
Technical Index measures market breadth by William Mason
ARTICLE SYNOPSIS ...Technical Index measures market breadth
by William Mason
There are numerous driving forces in the stock market such as inflation, interest rates, earnings, trade
deficit, fear and greed. The final output from the driving forces behind the stock market are the various
indices such as the NYSE Composite. Dow Jones Industrial Average, S&P 500.
These are fine indices for measuring the market results, but quite removed from the input side of the
equation. Some technicians try to build models around these variables with varying degrees of success.
What I wanted, instead, was the intermediate or tr...
ARTICLE SYNOPSIS ...The Wall Street Week index
by Arthur A. Merrill
Every six months I have been checking the accuracy of more than 40 indicators over a span of several
years. On the last test, the indicator that came out on top was the Wall Street Week Technical Market
Indicator (WSW Index) reported on the Wall Street Week public television program.
In the test, the scores are in the form of a batting average. Each indicator is asked each week whether it is
bullish or bearish, and the number of times this opinion is right or wrong is determined by the direction
of the market in the next 13 weeks, six months or...