STOCKS & COMMODITIES magazine. The Traders' Magazine

Article Archive For APR2008

  • Books For Traders by Technical Analysis, Inc.

    ARTICLE SYNOPSIS ...Books For Traders by Technical Analysis, Inc. ? 100 Minds That Made The Market ? A Lesson A Day For Traders ? Active Value Investing: Making Money In Range-Bound Markets ? Marber On Markets: How To Make Money From Charts ? Create Your Own ETF Hedge Fund: A Do-It-Yourself ETF Strategy For Private Wealth Management ? Mobs, Messiahs, And Markets: Surviving The Public Spectacle In Finance And Politics ? Stocks For The Long Run, 4th Edition ? STOP And Make Money...

  • Did Dow Theory Fail? by Tim W. Wood, CPA

    ARTICLE SYNOPSIS ...Did Dow Theory Fail? by Tim W. Wood, CPA Here's a look at the chain of events that have taken place since 2002 and what we can learn from them. AS the Dow Jones industrials topped out in 2000 and plunged nearly 38% into the 2002 low, every indication, according to Dow theory, was that an extended secular bear market had begun. In addition, because of Dow theory phasing along with the normal bull and bear market relationships, indications were that this was the rally separating phase I from phase II of a much longer-term bear market. So what went wrong? I will examine the chain of events that...

  • Explore Your Options by Tom Gentile

    ARTICLE SYNOPSIS ...Explore Your Options by Tom Gentile THE COLLAR VS. THE BULL CALL SPREAD I know that owning shares of stock and a put option are equivalent to simply holding a call option. If so, then the collar should represent the equivalent of the bull call spread. Since collars require so much more capital, why do many investors prefer the collar over the bull call spread? Wouldn't it be better to use a bull call spread and then get the interest from a money market account? Great question. You are absolutely correct that buying shares and a put is the synthetic equivalent of owning a long call. If you b...

  • Forex Focus: Making Sense Of Currency Movements by Grace Cheng

    ARTICLE SYNOPSIS ...Forex Focus: Making Sense Of Currency Movements by Grace Cheng With currency movements so randomized, how could you possibly know when to enter and exit trades? One of the most frequently asked questions among forex traders is certainly this: What on earth is [any currency pair] doing? This question tends to come up especially when you have open positions in the forex market. The nonstop fluctuations of a currency pair's exchange rate may seem totally random. Some traders will question if it is possible to even trade accurately in such a random market. Making sense of currency price movemen...

  • Futures For You by Carley Garner

    ARTICLE SYNOPSIS ...Futures For You by Carley Garner OPTIONS OR FUTURES? Should I be trading commodity options or commodity futures? This is a difficult question to answer because it is a decision that traders must make based on their tolerance for risk, their personality, and trading style. However, it is my opinion that in general, option trading is the optimal choice. I am not referring to long option?only strategies, although sometimes they are appropriate. Instead, I believe that option selling or option spread trades that involve both long and short options are preferential. We all agree that the key to...

  • Interview: Paul Hickey & Justin Walters of Bespoke by Jayanthi Gopalakrishnan

    ARTICLE SYNOPSIS ...Interview: Paul Hickey & Justin Walters of Bespoke by Jayanthi Gopalakrishnan It's a classic situation: Young bucks learn all they can from the seasoned veteran, and once they have, it's time for them to move on, to put their own stamp on the horizon. It's been true all throughout time, and in this case, it's Wall Street instead of the Wild West. Paul Hickey and Justin Walters spent time at Birinyi Associates learning and absorbing all they could from technician Laszlo Birinyi before going out on their own, setting up Bespoke Investment Group in May 2007. Paul Hickey's professional experienc...

  • Letters To S&C by Technical Analysis, Inc.

    ARTICLE SYNOPSIS ...Letters To S&C by Technical Analysis, Inc. ICHIMOKU CHARTS Editor, I am interested in using ichimoku charts. Can you tell me of any charting services that provide access to this type of chart? KIRBY OWEN Yulee, FL A check of our Traders' Resource database of products and services at our website (http://technical.traders.com/ Products/searchinfo.asp) for software that lists ichimoku charts as a feature comes up with PatternExplorer for AmiBroker. You may wish to give that a look at www.PatternExplorer.com. In our September 2007 issue, we published an article by Nicole Elliott titled "Ichim...

  • Missing The 10 Best Days by Richard Ahrens

    ARTICLE SYNOPSIS ...Missing The 10 Best Days by Richard Ahrens Would missing the 10 best days in the last 20 years have a negative impact on your portfolio? One of the standard arguments against attempting to time the market says that if you missed the 10 best days in the last 20 years, the long-term value of your portfolio would be significantly less than if you had just stayed the course. Using price data from the Standard & Poor's 500, I decided to find out if this argument was really true. Rather than limiting the search to just the 10 biggest one-day gains in the last 10 or 20 years, I tracked down the 20 ...

Opening Position

  • Q&A by Don Bright

    ARTICLE SYNOPSIS ...Q&A by Don Bright NOT SUPER-FANCY Maybe Don or somebody else can tell me how to calculate S&P futures. I remember back in the early 1990s, one guy at the quote terminal would calculate it by having a Standard & Poor's 500 call and put option quote with the S&P 500 indicator. Somehow, you would subtract the price difference of one or both contracts and come up with a number (if it was less than 10, the market was discount, and if it was greater than 10, it was at premium) that would indicate an imminent sell or buy. It worked very well. Not only that, I want to get a real-time tick. I used t...

  • RSI Bands by Francois Bertrand

    ARTICLE SYNOPSIS ...RSI Bands by Francois Bertrand In this twist on the traditional relative strength index, find out how it can be used as a visual analytical tool and with other technical indicators. The relative strength index (RSI) is a popular indicator to evaluate if a stock is overbought or oversold. However, its values range from zero to 100 and must be evaluated in a separate window, making its correlation with price and trends more difficult than other indicators that are overlaid directly on price charts such as the Bollinger bands. In this article I present a way of calculating RSI bands, which tra...

  • Stocks & Commodities V. 26:4 (32-38) Bull Put Spreads by Jay Kaeppel

    ARTICLE SYNOPSIS ...Bull Put Spreads by Jay Kaeppel In part 4 of this series, you'll find out more about the bull put spread strategy. AS discussed in the first article in this series, several key factors should be considered in determining the best option trading strategy to use at any given time for a given security. In this installment we will look at a specific trading strategy -- the bull put spread -- and how to use the PROVEST criteria to identify trading opportunities. STRATEGY: BULL PUT SPREADS As I have stated in the past, one of the most attractive features about trading options is the ability to cre...

Traders' Resource: Mutual Funds by Technical Analysis, Inc.

  • Traders' Tips by Technical Analysis, Inc.

    ARTICLE SYNOPSIS ...Traders' Tips by Technical Analysis, Inc. Editor's note: This month's Traders' Tips are based on François Bertrand's article in this issue, "RSI Bands." Code written in the AmiBroker formula language is already provided by Bertrand in the article's sidebars. Additional code is presented here. Readers will find our Traders' Tips section in its entirety at the STOCKS & COMMODITIES website at www.Traders.com in the Traders' Tips area, from where the code can be copied and pasted into the appropriate program. In addition, the code for each program is usually available at the respective software ...

  • True Price Value by Daryl Guppy and Chen Jing

    ARTICLE SYNOPSIS ...True Price Value by Daryl Guppy and Chen Jing What is more important in determining market behavior and market pricing, fair value based on fundamentals or the market value created by psychological trading behavior? The classic economic and market models rest on fair value and describe pricing activity in the market as subject to "irrational exuberance." An analysis of the China and Hong Kong markets with a parallel listing of China-based companies suggest that psychological trading behavior has a much greater role to play in correct market pricing. The study suggests that the market price i...

Working Money: Hi-Yo, Silver! A Wave! by Bruce R. Faber

Working Money: Speculating With The 10-Bagger by Thomas Maskell

Working Money: When And Where To Take Profits by Larry Swing








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