STOCKS & COMMODITIES magazine. The Traders' Magazine

Article Archive For SEP1992

  • Are There Persistent Cycles? by E. Michael Poulos

    ARTICLE SYNOPSIS ...Are There Persistent Cycles? by E. Michael Poulos Most technical indicators use a fixed lookback length based on the idea that cycles are present in the price data. Should the same fixed lookback length be used for all markets? Are there persistent cycles present to justify the use of the same lookback length for evaluating the market? Mike Poulos searches through a number of markets for persistent cycles and offers his solutions. Most technical indicators either smooth (filter) or normalize (on a scale to 0 to 100) the tradeable price in an attempt to indicate the trend direction or a trend...

  • Breaking Out Of The Trading Range by John Sweeney

    ARTICLE SYNOPSIS ...Breaking Out Of The Trading Range by John Sweeney Some blessed day, after being mired in a trading range for two years, your market is going to finally go into a trend. You must be there when it does, not trading something else or, worse, ignoring it from the golf course. Ideally, you've been trading the range back and forth trying to avoid losing money and possibly even making a little. You've been selling the tops and buying the bottoms as best you can, waiting for a breakout. How can you tell if it's happened? Graphically, as in Figure 1, you are waiting for a trade that hits your maximum...

  • Forecasting Market Turns Using Static And Dynamic Cycles by Brad Swancoat and Ed Kasanjian

    ARTICLE SYNOPSIS ...Forecasting Market Turns Using Static And Dynamic Cycles by Brad Swancoat and Ed Kasanjian Who hasn't heard of Fibonacci ratios by now, but to actually use them in predicting market turns? Here, two software developers give novice and veteran technicians alike a few things to ponder over. Cycles have long been used by technicians to forecast turns in the markets. However, the student of cycle analysis can become frustrated by the intermittent nature of regular rhythmic time cycles. The understanding and use of dynamic cycles will allow the technician to accurately forecast trend changes week...

  • Four Common Errors In Testing Trading Systems by Thomas A. Meyers

    ARTICLE SYNOPSIS ...Four Common Errors In Testing Trading Systems by Thomas A. Meyers The author of The Technical Analysis Course debuts as a Stocks & Commodities writer with this article. Here, Thomas Meyers explains that mistakes made in systems testing can make the difference between the accurate assessment of a system's profitability and a distorted picture that failed to take into account certain inevitable factors. Meyers shows you how to fine tune your testing techniques so that these problems can't cost you all your trading capital when you go to trade in real time. A trading system is a set of rules t...

  • Gann Weekly Swing Chart by Jerry Favors

    ARTICLE SYNOPSIS ...Gann Weekly Swing Chart by Jerry Favors Newsletter publisher Jerry Favors presents another Gann method, this time the weekly swing chart, as a timing tool with which to track individual stocks. One of the methods that W.D. Gann used to determine and trade the main trend of stocks and commodities was what are commonly referred to as swing charts. These swing charts cover varying degrees of time spans ranging from hourly charts to yearly charts. Each of the Gann swing charts turns up or down based on specific rules. The longer the time span covered by any swing chart, the stronger and more im...

  • Is Dow Theory Sending Us A Warning? by Michael D. Sheimo

    ARTICLE SYNOPSIS ...Is Dow Theory Sending Us A Warning? by Michael D. Sheimo Michael Sheimo, best known for books such as Dow Theory Redux and Stock Market Rules, tackles the age-old question of whether the Dow theory is still valid and if it is, is it really sending us a warning? After more than a hundred years, are the concepts of the Dow theory still useful in determining stock market strength? The Dow theory was arrived at by an evolutionary process over a period of several years. At the turn of the century, Charles Henry Dow discussed stock trading ideas in the newspaper he was both editor and publisher of...

  • Real Life: Shearson's Jeffrey Weiss by Thom Hartle

    ARTICLE SYNOPSIS ...Real Life: Shearson's Jeffrey Weiss by Thom Hartle Some people get a start on their careers early, but Jeffrey Weiss, a Chartered Market Technician and a first vice president with Shearson Lehman, began earlier than most, at age 13. The technical analysis risk management approach (Tarma) he pioneered was developed from his own trading experiences, including the disastrous 1973-74 bear market. His opinions have been widely solicited outside Shearson and he has been a guest on such well-known financial and investment shows as ""Wall $treet Week,"" CNBC's ""Inside Opinion"" and ""Business View""...

  • SIDEBAR: Random Walk Index Spreadsheet by Technical Analysis, Inc.

    ARTICLE SYNOPSIS ...Random Walk Index Spreadsheet by Technical Analysis, Inc. Random Walk index spreadsheet....

SIDEBAR: SIDEBAR 1

  • SIDEBAR: THIRTEEN INVESTMENT TENETS by Technical Analysis, Inc.

    ARTICLE SYNOPSIS ...THIRTEEN INVESTMENT TENETS by Technical Analysis, Inc. To improve your investment performance... THIRTEEN INVESTMENT TENETS THAT COULD IMPROVE YOUR INVESTMENT PERFORMANCE...

  • Summed Rate Of Change (KST) by Martin J. Pring

    ARTICLE SYNOPSIS ...Summed Rate Of Change (KST) by Martin J. Pring In the August Stocks & Commodities, noted technician Martin Pring presented smoothed rate of change indicators as a method to identify both the trend and reversals of trend in the markets. He pointed out that different rate of change measurements could lag important market turns due to the presence of different time cycles. Here, Pring presents his method of combining various rate of change indicators for enhanced trend and reversal of trend identification. Previously, I pointed out that price trends in financial markets are influenced by the in...

  • Traders' Tips by Technical Analysis, Inc.

    ARTICLE SYNOPSIS ...Traders' Tips by Technical Analysis, Inc. METASTOCK PROFESSIONAL 3.0 Mass Index The June 1992 issue of S&C presented an indicator called the mass index developed by Donald Dorsey. The indicator is a 25 day moving sum of a ratio of two moving averages. The numerator of the ratio is the exponentially smoothed moving average of the daily ranges. The denominator of the ratio is the numerator smoothed a second time using the same exponential moving average. The exponential moving averages use a smoothing factor (alpha) equivalent to a nine-day simple moving average....

  • Utilities And Stocks by John J. Murphy

    ARTICLE SYNOPSIS ...Utilities And Stocks by John J. Murphy Last month, this technical trailblazer examined how utilities and bonds were interconnected. This month, John J. Murphy analyzes how utilities in turn affect stocks. My article on utilities and bonds examined the close link between utility stocks and Treasury bond prices. Because bonds usually act as a leading indicator for stocks and because utilities are sensitive to interest rates, it should be no surprise that utilities also provide advance warning about the future direction of the stock market as a whole. Figure 1 provides a five-year comparison o...

  • V.10:9 SIDEBAR: Calculating the KST by Technical Analysis, Inc.

    ARTICLE SYNOPSIS ...Calculating the KST by Technical Analysis, Inc. KST formulas for short, intermediate, and long term daily or weekly data....







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