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• IBM, Cubed by Dennis Meyers, Ph.D.

  ARTICLE SYNOPSIS ...IBM, Cubed Here's a look at what's involved in developing a trend-following indicator for trading IBM. In a previous article, I showed how the application of a curve generatedbyathird-degreepoly-nomial could be used to develop a system to buy and sell British pound (BP) futures. This time, we will use a variation of that cubed system to create a system to trade IBM. IBM, one of the premier computer corporations in the world, is a major factor in the movement of the Dow Jones and Standard & Poor's 500 indices. Although IBM is traded on all regional exchanges, the lion's share and real market ...

AUTHOR: Dennis Meyers, Ph.D.DATE: AUG1999SUBJECT: System Design

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• Interview: Kevin Haggerty by Thom Hartle

  ARTICLE SYNOPSIS ...A Guide To Conquering The Trading Markets - Kevin Haggerty Kevin Haggerty's career on Wall Street covers nearly 25 years and numerous responsibilities ranging from senior vice president and manager of equity trading at Fidelity Capital Markets to serving as a managing director of the Chicago Board Options Exchange. Now he's teamed up with Mark Boucher and Larry Connors, some other noted names in the business that STOCKS & COMMODITIES readers may recognize, to cofound a Website for traders called TRADEHARD.COM. S&C Editor Thom Hartle spoke to Haggerty on May 18, 1999, about topics ranging from...

AUTHOR: Thom HartleDATE: AUG1999SUBJECT: Interview

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• Momentum And Relative Strength Index by Stuart Evens

  ARTICLE SYNOPSIS ...Momentum And Relative Strength Index Last month, we examined the theory of price momentum. This time, we'll look at two common and popular indicators based on this theory, and how they can be used to enter and exit a market. ""Momentum oscillator" is a generic term used to refer to many different indicators, two of which are the relative strength index (RSI) and momentum indicators. Since J. Welles Wilder presented price momentum and the RSI in his classic New Concepts In Trading Systems, both indicators have become popular technical tools, and a discussion of each can be found in most curre...

AUTHOR: Stuart EvensDATE: AUG1999SUBJECT: Novice Traders' Notebook

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• NOVICE TRADER'S NOTEBOOK

  ARTICLE SYNOPSIS ...? COMPLEX TOP The complex top is a broad classification of somewhat irregular patterns that do not fit into any one of the other pattern definitions. One complex top pattern, the complex head-and-shoulders top, is one of the more symmetrical formations that fall into this group. The complex variety of head-and-shoulders tops consists of different numbers and combinations of shoulders and heads, rather than just one head and one each of left and right shoulders, as in the standard variety. The complex head-and-shoulders top occurs less frequently than the standard variety but has the same, if n...

AUTHOR: Technical Analysis, Inc.DATE: AUG1999SUBJECT: Novice Traders' Notebook

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• Pseudo Securities For Technical Analysts, Part 3 by Charles E. Miller

  ARTICLE SYNOPSIS ...Pseudo Securities For Technical Analysts Part 3 The first two parts of this three-part series examined the theory, generation technique, and time series application of rectilinear pseudo securities. In this, the conclusion, the same theory is applied to the frequency domain of the market using sinusoidal pseudo securities to produce a method for their construction. Whereas the time domain was used to investigate the linear relationships between market data and time, the frequency domain will enable us to identify and study cyclical, nonlinear relationships in security price movement. Trendli...

AUTHOR: Charles E. MillerDATE: AUG1999SUBJECT: New Techniques

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• System Optimization And Money Management by L. Zamansky, Ph.D., and M. Stolz

  ARTICLE SYNOPSIS ...System Optimization And Money Management Most traders focus on optimizing the trading system rules and ignore money management rules until after the system rules have been established. Here's why you should test both sets of rules simultaneously. Modern charting and analysis software for traders is equipped with the ability to optimize inputs for a trading system. To optimize inputs, first, a system must be run for each combination of input values within the set limits and with a given setup. The result is a table that has for each set of input values a corresponding set of performance chara...

AUTHOR: L. Zamansky, Ph.D., and M. StolzDATE: AUG1999SUBJECT: Money Management

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• The Night/Daymares Of Traders by Adrienne Laris Toghraie

  ARTICLE SYNOPSIS ...The Night/Daymares Of Traders Your mind doesn't shut down when you go to sleep. Sometimes, the trading from the daytime can stay with you into the dreamtime. Here are ways to cope with trading nightmares. If trading is a high-stakes game of skill, psychology, and chance played on a multidimensional board, then none of the dimensions can be ignored. Yet one influential dimension is consistently overlooked because it is assumed that it is under control or has little effect. The dimension in question? Our dream world. This world includes our dreams from sleep as well as our waking hours. Unwitt...

AUTHOR: Adrienne Laris ToghraieDATE: AUG1999SUBJECT: Trading Psychology

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• V.17:8: LETTERS

  ARTICLE SYNOPSIS ...TRACKING COMMODITY PORTFOLIO Editor, Is there a Website I can use to track my portfolio of commodities and options? Currently, I use Yahoo!, but it only covers the Chicago Board of Trade and doesn't provide quotes from NYMEX and other exchanges. Perhaps this topic could be the subject of a short article. TIM DENKER, via E-mail Thanks for writing. Last month, we launched a new section called "Websites for Traders," where we describe Websites with features that traders would find of interest. We'll keep an eye out for a Website that offers commodity and options portfolio tracking. In the meant...

AUTHOR: Technical Analysis, Inc.DATE: AUG1999SUBJECT: Letters To S&C

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• Value At Risk And Technical Analysis by Luis Ballesca-Loyo

  ARTICLE SYNOPSIS ...Value At Risk And Technical Analysis This method uses market volatility and the concept of value at risk to help determine meaningful stop-loss prices and position limits for trading securities. Many traders and investors apply security analysis techniques, either technical or fundamental, to take positions using mechanical buy and sell signals generated by their systems. In developing their systems, time is spent on developing the entry signals and, to a lesser extent, the exit signals. But as a rule, not as much time is spent reviewing the expected adverse moves typical of that system and ...

AUTHOR: Luis Ballesca-LoyoDATE: AUG1999SUBJECT: Novice Traders' Notebook

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• Website For Traders

  ARTICLE SYNOPSIS ...YAHOO! FINANCE http://quote.yahoo.com Yahoo!, a leading Website directory, also offers a site-within-a-site at http://quote.yahoo.com for quotes, charts, and financial information. Here, you can check delayed quotes, view basic charts, and access a range of news and fundamental data. You can perform some basic fundamental analysis on stocks and mutual funds. You can research equities by industries. You can even access data on foreign markets. A well-rounded site, it also provides information on consumer products such as mortgage loans and auto loans. Input a symbol and get a delayed, extended...

AUTHOR: Technical Analysis, Inc.DATE: AUG1999SUBJECT: Websites

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• What Market Timing Is - And Isn't by Paul A. Merriman

  ARTICLE SYNOPSIS ...What Market Timing Is -- And Isn't Market timing is supposed to be great at reducing your risk while letting you profit in the bull moves, but is it all it's cracked up to be? This market timer discusses the pros and cons. Market timing -- and market timers -- are often treated in the media as barely a step above snake-oil salesmen. It's easy to become defensive in response. But confession is good for the soul. So here's an insider's look at what timing is -- and isn't. I could claim that market timing has a big impact on long-term returns. But it doesn't; timing is much less important than asse...

AUTHOR: Paul A. MerrimanDATE: AUG1999SUBJECT: Market Timing